Discounted Cash Flow (DCF) Analysis Unlevered

Embraer S.A. (ERJ)

$16.5

+0.18 (+1.10%)
All numbers are in Millions, Currency in USD
Stock DCF: 6.83 | 16.5 | overvalue

Operating Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 5,839.305,071.102,618.103,771.104,197.204,132.264,068.324,005.373,943.403,882.38
Revenue (%)
EBITDA 832.40358.806.40-126.90478.70244.75240.97237.24233.57229.95
EBITDA (%)
EBIT 489.7086.80-203.30-419270.10-19.36-19.06-18.77-18.48-18.19
EBIT (%)
Depreciation 342.70272209.70292.10208.60264.12260.03256.01252.05248.15
Depreciation (%)

Balance Sheet Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Total Cash 3,636.403,024.301,2652,700.602,569.102,504.592,465.832,427.682,390.112,353.13
Total Cash (%)
Account Receivables 981.70991705.80792895.40873.13859.62846.32833.22820.33
Account Receivables (%)
Inventories 2,119.802,475.601,274.802,421.701,955.202,021.601,990.321,959.531,929.211,899.36
Inventories (%)
Accounts Payable 824.70892.10358502.30510585.62576.56567.64558.86550.21
Accounts Payable (%)
Capital Expenditure -708.20-444.30-567.70-223.70-268.20-453.68-446.66-439.75-432.95-426.25
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 16.5
Beta 0.958
Diluted Shares Outstanding 183.68
Cost of Debt
Tax Rate 263.14
After-tax Cost of Debt -9.72%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.042
Total Debt 4,090.70
Total Equity 3,030.76
Total Capital 7,121.46
Debt Weighting 57.44
Equity Weighting 42.56
Wacc

Build Up Free Cash

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 5,839.305,071.102,618.103,771.104,197.204,132.264,068.324,005.373,943.403,882.38
EBITDA 832.40358.806.40-126.90478.70244.75240.97237.24233.57229.95
EBIT 489.7086.80-203.30-419270.10-19.36-19.06-18.77-18.48-18.19
Tax Rate 14.39%-30.84%-218.48%-15.22%263.14%2.60%2.60%2.60%2.60%2.60%
EBIAT 419.21113.57-647.47-482.79-440.64-18.86-18.57-18.28-18-17.72
Depreciation 342.70272209.70292.10208.60264.12260.03256.01252.05248.15
Accounts Receivable --9.30285.20-86.20-103.4022.2713.5113.3013.0912.89
Inventories --355.801,200.80-1,146.90466.50-66.4031.2830.8030.3229.85
Accounts Payable -67.40-534.10144.307.7075.62-9.06-8.92-8.78-8.65
Capital Expenditure -708.20-444.30-567.70-223.70-268.20-453.68-446.66-439.75-432.95-426.25
UFCF 53.71-356.43-53.57-1,503.19-129.44-176.93-169.47-166.85-164.27-161.72
WACC
PV UFCF -180.84-177.04-178.14-179.26-180.38
SUM PV UFCF -895.66

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) -2.16
Free cash flow (t + 1) -164.96
Terminal Value 3,965.37
Present Value of Terminal Value 4,422.84

Intrinsic Value

Enterprise Value 3,527.18
Net Debt 2,272.40
Equity Value 1,254.78
Shares Outstanding 183.68
Equity Value Per Share 6.83