Discounted Cash Flow (DCF) Analysis Unlevered

H&R Block, Inc. (HRB)

$45.55

-1.03 (-2.21%)
All numbers are in Millions, Currency in USD
Stock DCF: 122.44 | 45.55 | 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 3,094.882,639.723,413.993,463.273,472.183,613.903,761.393,914.914,074.694,241
Revenue (%)
EBITDA 798.91368.26932.46889.53914.69860.87896932.57970.631,010.25
EBITDA (%)
EBIT 632.21198.72775.61747.35784.19685.47713.45742.57772.88804.42
EBIT (%)
Depreciation 166.69169.54156.85142.18130.50175.40182.55190197.76205.83
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 1,572.152,661.91934.25885.01986.981,683.961,752.691,824.221,898.681,976.17
Total Cash (%)
Account Receivables 138.96133.20531.24261.2895.90255.89266.33277.20288.51300.29
Account Receivables (%)
Inventories 281.96291.33233.66311.60312.40325.15338.42352.23366.61381.57
Inventories (%)
Accounts Payable 249.52203.10198.08160.93159.90222.69231.78241.24251.09261.34
Accounts Payable (%)
Capital Expenditure -95.49-81.69-52.79-61.95-69.70-83.28-86.68-90.22-93.90-97.73
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 45.55
Beta 0.645
Diluted Shares Outstanding 153.51
Cost of Debt
Tax Rate 22.15
After-tax Cost of Debt 3.37%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.377
Total Debt 1,934.91
Total Equity 6,992.47
Total Capital 8,927.38
Debt Weighting 21.67
Equity Weighting 78.33
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 3,094.882,639.723,413.993,463.273,472.183,613.903,761.393,914.914,074.694,241
EBITDA 798.91368.26932.46889.53914.69860.87896932.57970.631,010.25
EBIT 632.21198.72775.61747.35784.19685.47713.45742.57772.88804.42
Tax Rate 22.50%-123.06%12.70%15.99%22.15%-9.94%-9.94%-9.94%-9.94%-9.94%
EBIAT 489.98443.26677.09627.84610.52753.64784.39816.41849.73884.41
Depreciation 166.69169.54156.85142.18130.50175.40182.55190197.76205.83
Accounts Receivable -5.77-398.05269.96165.39-159.99-10.44-10.87-11.31-11.78
Inventories --9.3757.67-77.93-0.80-12.75-13.27-13.81-14.38-14.96
Accounts Payable --46.42-5.02-37.15-1.0362.799.099.469.8510.25
Capital Expenditure -95.49-81.69-52.79-61.95-69.70-83.28-86.68-90.22-93.90-97.73
UFCF 561.18481.09435.75862.93834.88735.80865.64900.97937.74976.02
WACC
PV UFCF 690.83763.06745.66728.66712.04
SUM PV UFCF 3,640.25

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.51
Free cash flow (t + 1) 995.54
Terminal Value 22,074.01
Present Value of Terminal Value 16,103.84

Intrinsic Value

Enterprise Value 19,744.08
Net Debt 947.93
Equity Value 18,796.15
Shares Outstanding 153.51
Equity Value Per Share 122.44