Discounted Cash Flow (DCF) Analysis Unlevered

Fairfax Financial Holdings Limited (FFH.TO)

$654.05

-11.65 (-1.75%)
All numbers are in Millions, Currency in USD
Stock DCF: 509.93 | 654.05 | 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 14,005.6016,507.8021,18119,843.5025,801.9030,309.9535,605.6341,826.5749,134.4157,719.07
Revenue (%)
EBITDA 2,760.601,116.803,349.101,653.105,571.404,377.455,142.276,040.727,096.148,335.96
EBITDA (%)
EBIT 2,480.10767.302,737.609014,6413,504.344,116.614,835.855,680.766,673.29
EBIT (%)
Depreciation 280.50349.50611.50752.10930.40873.111,025.661,204.861,415.371,662.66
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 18,958.507,307.8010,628.4013,727.2025,343.8024,079.0328,286.0633,228.1439,033.6845,853.56
Total Cash (%)
Account Receivables 13,445.1014,231.4016,050.6017,659.7018,973.7025,491.7229,945.5835,177.6041,323.7548,543.75
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 1,899.701,961.302,5913,589.709,478.905,607.636,587.397,738.329,090.3410,678.59
Accounts Payable (%)
Capital Expenditure -415.20-236.50-319.60-273.30-353.90-524.66-616.33-724.02-850.51-999.11
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 654.05
Beta 0.937
Diluted Shares Outstanding 27.82
Cost of Debt
Tax Rate 22.57
After-tax Cost of Debt 5.13%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.270
Total Debt 7,753
Total Equity 18,196.23
Total Capital 25,949.23
Debt Weighting 29.88
Equity Weighting 70.12
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 14,005.6016,507.8021,18119,843.5025,801.9030,309.9535,605.6341,826.5749,134.4157,719.07
EBITDA 2,760.601,116.803,349.101,653.105,571.404,377.455,142.276,040.727,096.148,335.96
EBIT 2,480.10767.302,737.609014,6413,504.344,116.614,835.855,680.766,673.29
Tax Rate 13.97%56.39%10.24%10.53%22.57%22.74%22.74%22.74%22.74%22.74%
EBIAT 2,133.68334.652,457.30806.143,593.432,707.503,180.553,736.254,389.045,155.88
Depreciation 280.50349.50611.50752.10930.40873.111,025.661,204.861,415.371,662.66
Accounts Receivable --786.30-1,819.20-1,609.10-1,314-6,518.02-4,453.86-5,232.02-6,146.15-7,219.99
Inventories ----------
Accounts Payable -61.60629.70998.705,889.20-3,871.27979.751,150.931,352.021,588.24
Capital Expenditure -415.20-236.50-319.60-273.30-353.90-524.66-616.33-724.02-850.51-999.11
UFCF 1,998.98-277.051,559.70674.548,745.13-7,333.34115.78136.01159.77187.68
WACC
PV UFCF -6,877.37101.83112.18123.59136.15
SUM PV UFCF -6,403.62

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.63
Free cash flow (t + 1) 191.44
Terminal Value 4,134.72
Present Value of Terminal Value 2,999.50

Intrinsic Value

Enterprise Value -3,404.12
Net Debt -17,590.80
Equity Value 14,186.68
Shares Outstanding 27.82
Equity Value Per Share 509.93