Discounted Cash Flow (DCF) Analysis Unlevered

Charter Communications, Inc. (CHTR)

$ 565

+10.00 (+1.80%)

All numbers are in Millions, Currency in USD

Stock DCF: 2,708.16 | 565 | undervalue

Operating Data

Year A/P	2016 Actual	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Projected	2022 Projected	2023 Projected	2024 Projected	2025 Projected
Revenue	29,003	41,581	43,634	45,764	48,097	55,105.30	63,134.78	72,334.26	82,874.21	94,949.96
Revenue (%)
EBITDA	10,003	14,486	15,268	15,830	17,400	19,296.33	22,108.04	25,329.44	29,020.23	33,248.82
EBITDA (%)
EBIT	3,096	3,898	4,950	5,904	7,696	6,645.21	7,613.49	8,722.87	9,993.89	11,450.12
EBIT (%)
Depreciation	6,907	10,588	10,318	9,926	9,704	12,651.12	14,494.54	16,606.57	19,026.34	21,798.70
Depreciation (%)

Balance Sheet Data

Year A/P	2016 Actual	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Projected	2022 Projected	2023 Projected	2024 Projected	2025 Projected
Total Cash	1,535	621	551	3,483	998	1,954.54	2,239.34	2,565.63	2,939.48	3,367.79
Total Cash (%)
Account Receivables	1,432	1,635	1,733	2,227	2,201	2,455.89	2,813.74	3,223.74	3,693.47	4,231.66
Account Receivables (%)
Inventories	-	-	-	-	-	-	-	-	-	-
Inventories (%)
Accounts Payable	454	740	758	786	763	924.23	1,058.91	1,213.20	1,389.98	1,592.51
Accounts Payable (%)
Capital Expenditure	-33,532	-7,870	-9,595	-7,140	-7,956	-20,794.05	-23,823.99	-27,295.42	-31,272.69	-35,829.49
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 565
Beta	0.944
Diluted Shares Outstanding	209.27
Cost of Debt
Tax Rate	25.10
After-tax Cost of Debt	3.48%
Risk-Free Rate
Market Risk Premium
Cost of Equity	6.265
Total Debt	82,987
Total Equity	118,239.38
Total Capital	201,226.38
Debt Weighting	41.24
Equity Weighting	58.76
Wacc

Build Up Free Cash

Year A/P	2016 Actual	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Projected	2022 Projected	2023 Projected	2024 Projected	2025 Projected
Revenue	29,003	41,581	43,634	45,764	48,097	55,105.30	63,134.78	72,334.26	82,874.21	94,949.96
EBITDA	10,003	14,486	15,268	15,830	17,400	19,296.33	22,108.04	25,329.44	29,020.23	33,248.82
EBIT	3,096	3,898	4,950	5,904	7,696	6,645.21	7,613.49	8,722.87	9,993.89	11,450.12
Tax Rate	-329.51%	-862.55%	27.05%	31.39%	25.10%	-221.70%	-221.70%	-221.70%	-221.70%	-221.70%
EBIAT	13,297.70	37,520.15	3,611.21	4,050.96	5,763.95	21,377.96	24,492.97	28,061.89	32,150.83	36,835.59
Depreciation	6,907	10,588	10,318	9,926	9,704	12,651.12	14,494.54	16,606.57	19,026.34	21,798.70
Accounts Receivable	-	-203	-98	-494	26	-254.89	-357.85	-410	-469.74	-538.18
Inventories	-	-	-	-	-	-	-	-	-	-
Accounts Payable	-	286	18	28	-23	161.23	134.67	154.30	176.78	202.54
Capital Expenditure	-33,532	-7,870	-9,595	-7,140	-7,956	-20,794.05	-23,823.99	-27,295.42	-31,272.69	-35,829.49
UFCF	-13,327.30	40,321.15	4,254.21	6,370.96	7,514.95	13,141.37	14,940.35	17,117.33	19,611.52	22,469.15
WACC
PV UFCF						12,502.49	13,522.98	14,740.22	16,067.02	17,513.24
SUM PV UFCF										74,345.95

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.11
Free cash flow (t + 1)	22,918.54
Terminal Value	736,930.42
Present Value of Terminal Value	574,389.25

Intrinsic Value

Enterprise Value	648,735.20
Net Debt	81,989
Equity Value	566,746.20
Shares Outstanding	209.27
Equity Value Per Share	2,708.16