Discounted Cash Flow (DCF) Analysis Unlevered

The Home Depot, Inc. (HD)

$290.39

+0.54 (+0.19%)
All numbers are in Millions, Currency in USD
Stock DCF: 322.64 | 290.39 | 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 100,904108,203110,225132,110151,157167,547.97185,716.32205,854.80228,177.02252,919.79
Revenue (%)
EBITDA 16,81717,75918,21220,84425,94627,660.2530,659.6433,984.2737,669.4141,754.16
EBITDA (%)
EBIT 14,75515,60715,91618,32523,08424,337.5926,976.6829,901.9533,144.4236,738.49
EBIT (%)
Depreciation 2,0622,1522,2962,5192,8623,322.663,682.954,082.324,524.995,015.67
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 3,5951,7782,1337,8952,3434,914.945,447.906,038.656,693.467,419.28
Total Cash (%)
Account Receivables 1,9521,9362,1062,9923,4263,406.483,775.864,185.314,639.155,142.20
Account Receivables (%)
Inventories 12,74813,92514,53116,62722,06822,073.2024,466.7427,119.8330,060.6233,320.30
Inventories (%)
Accounts Payable 7,2447,7557,78711,60613,46213,102.8914,523.7216,098.6317,844.3119,779.29
Accounts Payable (%)
Capital Expenditure -1,897-2,442-2,678-2,463-2,566-3,393.98-3,762.01-4,169.95-4,622.13-5,123.34
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 290.39
Beta 0.992
Diluted Shares Outstanding 1,078
Cost of Debt
Tax Rate 24.40
After-tax Cost of Debt 2.20%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.510
Total Debt 46,269
Total Equity 313,040.42
Total Capital 359,309.42
Debt Weighting 12.88
Equity Weighting 87.12
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 100,904108,203110,225132,110151,157167,547.97185,716.32205,854.80228,177.02252,919.79
EBITDA 16,81717,75918,21220,84425,94627,660.2530,659.6433,984.2737,669.4141,754.16
EBIT 14,75515,60715,91618,32523,08424,337.5926,976.6829,901.9533,144.4236,738.49
Tax Rate 37.00%23.60%23.60%24.22%24.40%26.56%26.56%26.56%26.56%26.56%
EBIAT 9,295.9311,923.9812,159.5413,886.7617,451.3217,872.6219,810.6621,958.8724,340.0226,979.37
Depreciation 2,0622,1522,2962,5192,8623,322.663,682.954,082.324,524.995,015.67
Accounts Receivable -16-170-886-43419.52-369.39-409.44-453.84-503.05
Inventories --1,177-606-2,096-5,441-5.20-2,393.55-2,653.09-2,940.79-3,259.68
Accounts Payable -511323,8191,856-359.111,420.831,574.901,745.681,934.98
Capital Expenditure -1,897-2,442-2,678-2,463-2,566-3,393.98-3,762.01-4,169.95-4,622.13-5,123.34
UFCF 9,460.9310,983.9811,033.5414,779.7613,728.3217,456.5118,389.5120,383.6122,593.9425,043.95
WACC
PV UFCF 16,208.4615,85416,316.7616,793.0317,283.21
SUM PV UFCF 82,455.45

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.70
Free cash flow (t + 1) 25,544.83
Terminal Value 448,154.93
Present Value of Terminal Value 309,278.45

Intrinsic Value

Enterprise Value 391,733.90
Net Debt 43,926
Equity Value 347,807.90
Shares Outstanding 1,078
Equity Value Per Share 322.64