Discounted Cash Flow (DCF) Analysis Unlevered

CMS Energy Corporation (CMS)

$54.05

+0.05 (+0.09%)

All numbers are in Millions, Currency in USD

Stock DCF: -250.13 | 54.05 | overvalue

Operating Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	6,873	6,845	6,680	7,329	8,596	9,115.74	9,666.90	10,251.39	10,871.22	11,528.52
Revenue (%)
EBITDA	1,232	1,348	1,446	1,323	1,421	1,710.98	1,814.43	1,924.14	2,040.48	2,163.85
EBITDA (%)
EBIT	299	356	398	209	295	397.32	421.34	446.81	473.83	502.48
EBIT (%)
Depreciation	933	992	1,048	1,114	1,126	1,313.67	1,393.09	1,477.32	1,566.65	1,661.37
Depreciation (%)

Balance Sheet Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Total Cash	153	140	168	452	164	270.95	287.33	304.70	323.13	342.66
Total Cash (%)
Account Receivables	1,227	1,126	1,157	943	1,580	1,510.84	1,602.19	1,699.07	1,801.80	1,910.74
Account Receivables (%)
Inventories	650	605	576	667	1,117	893.60	947.62	1,004.92	1,065.68	1,130.12
Inventories (%)
Accounts Payable	733	635	678	886	928	965.83	1,024.23	1,086.16	1,151.83	1,221.47
Accounts Payable (%)
Capital Expenditure	-2,220	-2,236	-2,448	-2,209	-2,481	-2,928.27	-3,105.32	-3,293.07	-3,492.18	-3,703.33
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 54.05
Beta	0.369
Diluted Shares Outstanding	289.50
Cost of Debt
Tax Rate	7.21
After-tax Cost of Debt	3.12%
Risk-Free Rate
Market Risk Premium
Cost of Equity	6.297
Total Debt	15,428
Total Equity	15,647.48
Total Capital	31,075.47
Debt Weighting	49.65
Equity Weighting	50.35
Wacc

Build Up Free Cash

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	6,873	6,845	6,680	7,329	8,596	9,115.74	9,666.90	10,251.39	10,871.22	11,528.52
EBITDA	1,232	1,348	1,446	1,323	1,421	1,710.98	1,814.43	1,924.14	2,040.48	2,163.85
EBIT	299	356	398	209	295	397.32	421.34	446.81	473.83	502.48
Tax Rate	15.12%	17.97%	14.69%	11.54%	7.21%	13.31%	13.31%	13.31%	13.31%	13.31%
EBIAT	253.80	292.01	339.54	184.87	273.74	344.45	365.28	387.36	410.78	435.62
Depreciation	933	992	1,048	1,114	1,126	1,313.67	1,393.09	1,477.32	1,566.65	1,661.37
Accounts Receivable	-	101	-31	214	-637	69.16	-91.35	-96.87	-102.73	-108.94
Inventories	-	45	29	-91	-450	223.40	-54.03	-57.30	-60.76	-64.43
Accounts Payable	-	-98	43	208	42	37.83	58.40	61.93	65.67	69.64
Capital Expenditure	-2,220	-2,236	-2,448	-2,209	-2,481	-2,928.27	-3,105.32	-3,293.07	-3,492.18	-3,703.33
UFCF	-1,033.20	-903.99	-1,019.46	-579.13	-2,126.26	-939.76	-1,433.93	-1,520.63	-1,612.57	-1,710.07
WACC
PV UFCF						-897.40	-1,307.58	-1,324.14	-1,340.91	-1,357.90
SUM PV UFCF										-6,227.93

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	4.72
Free cash flow (t + 1)	-1,744.27
Terminal Value	-64,127.70
Present Value of Terminal Value	-50,921.07

Intrinsic Value

Enterprise Value	-57,149
Net Debt	15,264
Equity Value	-72,413
Shares Outstanding	289.50
Equity Value Per Share	-250.13