Discounted Cash Flow (DCF) Analysis Unlevered

Gaotu Techedu Inc. (GOTU)

$3.77

-0.10 (-2.58%)
All numbers are in Millions, Currency in USD
Stock DCF: 87.32 | 3.77 | undervalue

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 63.57338.381,139.961,049.88399.71998.652,495.026,233.5415,573.8838,909.77
Revenue (%)
EBITDA 4.2440.90-219.25-471.993.01-89.24-222.97-557.07-1,391.77-3,477.21
EBITDA (%)
EBIT 3.5638.97-228.41-490-1.13-99.60-248.85-621.73-1,553.34-3,880.86
EBIT (%)
Depreciation 0.671.939.1518.014.1510.3625.8864.67161.56403.65
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 37247.591,229.84560.47599883.802,208.095,516.6913,782.8934,435.16
Total Cash (%)
Account Receivables 4.0111.299.4836.6613.9634.8787.12217.67543.831,358.71
Account Receivables (%)
Inventories --7.692.503.656.0715.1737.9194.71236.62
Inventories (%)
Accounts Payable ----------
Accounts Payable (%)
Capital Expenditure -1.94-9.80-45.45-43.57-14.08-35.17-87.88-219.55-548.52-1,370.43
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 3.77
Beta -0.791
Diluted Shares Outstanding 263.99
Cost of Debt
Tax Rate 620.02
After-tax Cost of Debt -134.68%
Risk-Free Rate
Market Risk Premium
Cost of Equity -0.251
Total Debt 13.20
Total Equity 995.23
Total Capital 1,008.44
Debt Weighting 1.31
Equity Weighting 98.69
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 63.57338.381,139.961,049.88399.71998.652,495.026,233.5415,573.8838,909.77
EBITDA 4.2440.90-219.25-471.993.01-89.24-222.97-557.07-1,391.77-3,477.21
EBIT 3.5638.97-228.41-490-1.13-99.60-248.85-621.73-1,553.34-3,880.86
Tax Rate 8.16%6.44%2.43%-1.35%620.02%127.14%127.14%127.14%127.14%127.14%
EBIAT 3.2736.46-222.86-496.605.8927.0367.54168.75421.601,053.32
Depreciation 0.671.939.1518.014.1510.3625.8864.67161.56403.65
Accounts Receivable --7.281.81-27.1822.70-20.91-52.25-130.55-326.16-814.88
Inventories ---5.20-1.15-2.43-9.10-22.74-56.80-141.91
Accounts Payable ----------
Capital Expenditure -1.94-9.80-45.45-43.57-14.08-35.17-87.88-219.55-548.52-1,370.43
UFCF 221.31-257.34-544.1517.51-21.12-55.80-139.42-348.33-870.26
WACC
PV UFCF -21.55-58.12-148.18-377.80-963.25
SUM PV UFCF -1,568.89

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) -2.01
Free cash flow (t + 1) -887.66
Terminal Value 22,136.17
Present Value of Terminal Value 24,501.55

Intrinsic Value

Enterprise Value 22,932.66
Net Debt -117.98
Equity Value 23,050.64
Shares Outstanding 263.99
Equity Value Per Share 87.32