Discounted Cash Flow (DCF) Analysis Unlevered

The Home Depot, Inc. (HD)

$305.73

-1.03 (-0.34%)
All numbers are in Millions, Currency in USD
Stock DCF: 336.16 | 305.73 | undervalue

Operating Data

Year
A/P
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Actual
2024
Projected
2025
Projected
2026
Projected
2027
Projected
2028
Projected
Revenue 108,203110,225132,110151,157157,403173,250.81190,694.23209,893.90231,026.66254,287.12
Revenue (%)
EBITDA 18,00618,21220,84425,94627,06928,864.7931,770.9834,969.7838,490.6442,366
EBITDA (%)
EBIT 15,85415,91618,32523,08424,09425,482.2228,047.8430,871.7833,980.0537,401.26
EBIT (%)
Depreciation 2,1522,2962,5192,8622,9753,382.573,723.144,097.994,510.594,964.73
Depreciation (%)

Balance Sheet Data

Year
A/P
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Actual
2024
Projected
2025
Projected
2026
Projected
2027
Projected
2028
Projected
Total Cash 1,7782,1337,8952,3432,7574,454.634,903.145,396.805,940.176,538.24
Total Cash (%)
Account Receivables 1,9362,1062,9923,4263,3173,582.313,942.984,339.974,776.945,257.89
Account Receivables (%)
Inventories 13,92514,53116,62722,06824,88623,925.1926,334.0528,985.4531,903.7935,115.96
Inventories (%)
Accounts Payable 7,7557,78711,60613,46211,44313,580.3314,947.6316,452.6118,109.1119,932.38
Accounts Payable (%)
Capital Expenditure -2,442-2,678-2,463-2,566-3,119-3,544.68-3,901.57-4,294.39-4,726.76-5,202.67
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 305.73
Beta 0.954
Diluted Shares Outstanding 1,025
Cost of Debt
Tax Rate 23.90
After-tax Cost of Debt 2.44%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.941
Total Debt 50,364
Total Equity 313,373.25
Total Capital 363,737.25
Debt Weighting 13.85
Equity Weighting 86.15
Wacc

Build Up Free Cash

Year
A/P
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Actual
2024
Projected
2025
Projected
2026
Projected
2027
Projected
2028
Projected
Revenue 108,203110,225132,110151,157157,403173,250.81190,694.23209,893.90231,026.66254,287.12
EBITDA 18,00618,21220,84425,94627,06928,864.7931,770.9834,969.7838,490.6442,366
EBIT 15,85415,91618,32523,08424,09425,482.2228,047.8430,871.7833,980.0537,401.26
Tax Rate 23.60%23.60%24.22%24.40%23.90%23.94%23.94%23.94%23.94%23.94%
EBIAT 12,112.6912,159.5413,886.7617,451.3218,335.5419,380.7221,332.0323,479.8125,843.8228,445.86
Depreciation 2,1522,2962,5192,8622,9753,382.573,723.144,097.994,510.594,964.73
Accounts Receivable --170-886-434109-265.30-360.68-396.99-436.96-480.96
Inventories --606-2,096-5,441-2,818960.81-2,408.86-2,651.39-2,918.34-3,212.17
Accounts Payable -323,8191,856-2,0192,137.331,367.311,504.971,656.501,823.28
Capital Expenditure -2,442-2,678-2,463-2,566-3,119-3,544.68-3,901.57-4,294.39-4,726.76-5,202.67
UFCF 11,822.6911,033.5414,779.7613,728.3213,463.5422,051.4419,751.3721,74023,928.8526,338.07
WACC
PV UFCF 20,410.4416,921.0817,238.7517,562.3817,892.09
SUM PV UFCF 90,024.74

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.04
Free cash flow (t + 1) 26,864.84
Terminal Value 444,782.05
Present Value of Terminal Value 302,151.24

Intrinsic Value

Enterprise Value 392,175.98
Net Debt 47,607
Equity Value 344,568.98
Shares Outstanding 1,025
Equity Value Per Share 336.16