Discounted Cash Flow (DCF) Analysis Unlevered
Heritage Commerce Corp (HTBK)
$7.28
-0.38 (-4.96%)
All numbers are in Millions, Currency in USD
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 | 131.60 | 142.06 | 151.81 | 155.81 | 189.99 | 208.70 | 229.25 | 251.82 | 276.62 | 303.85 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (%) | ||||||||||
| EBITDA | 59.17 | 70.74 | 62.35 | 77.07 | 107.07 | 100.87 | 110.80 | 121.71 | 133.69 | 146.86 |
| EBITDA (%) | ||||||||||
| EBIT | 56.48 | 67.16 | 57.65 | 73 | 103.31 | 95.75 | 105.18 | 115.53 | 126.91 | 139.41 |
| EBIT (%) | ||||||||||
| Depreciation | 2.70 | 3.59 | 4.70 | 4.07 | 3.76 | 5.12 | 5.62 | 6.17 | 6.78 | 7.45 |
| 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 | 623.61 | 862.19 | 1,366.85 | 1,408.47 | 796.20 | 1,379.16 | 1,514.96 | 1,664.13 | 1,827.99 | 2,007.99 |
|---|---|---|---|---|---|---|---|---|---|---|
| Total Cash (%) | ||||||||||
| Account Receivables | 44.58 | 67.14 | 87.52 | 85.11 | 93.47 | 101.26 | 111.23 | 122.19 | 134.22 | 147.43 |
| Account Receivables (%) | ||||||||||
| Inventories | - | - | - | - | - | - | - | - | - | - |
| Inventories (%) | ||||||||||
| Accounts Payable | 52.19 | 78.11 | 102 | 102.04 | 96.17 | 116.01 | 127.44 | 139.98 | 153.77 | 168.91 |
| Accounts Payable (%) | ||||||||||
| Capital Expenditure | -0.19 | -0.20 | -3.16 | -0.25 | -0.78 | -1.23 | -1.35 | -1.48 | -1.63 | -1.79 |
| Capital Expenditure (%) |
Weighted Average Cost Of Capital
| Share price | $ 7.28 |
|---|---|
| Beta | 0.928 |
| Diluted Shares Outstanding | 60.84 |
| Cost of Debt | |
| Tax Rate | 29.47 |
| After-tax Cost of Debt | 16.04% |
| Risk-Free Rate | |
| Market Risk Premium | |
| Cost of Equity | 8.017 |
| Total Debt | 39.35 |
| Total Equity | 442.95 |
| Total Capital | 482.30 |
| Debt Weighting | 8.16 |
| Equity Weighting | 91.84 |
| 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 | 131.60 | 142.06 | 151.81 | 155.81 | 189.99 | 208.70 | 229.25 | 251.82 | 276.62 | 303.85 |
|---|---|---|---|---|---|---|---|---|---|---|
| EBITDA | 59.17 | 70.74 | 62.35 | 77.07 | 107.07 | 100.87 | 110.80 | 121.71 | 133.69 | 146.86 |
| EBIT | 56.48 | 67.16 | 57.65 | 73 | 103.31 | 95.75 | 105.18 | 115.53 | 126.91 | 139.41 |
| Tax Rate | 27.38% | 28.15% | 28.06% | 27.58% | 29.47% | 28.13% | 28.13% | 28.13% | 28.13% | 28.13% |
| EBIAT | 41.01 | 48.25 | 41.47 | 52.86 | 72.87 | 68.82 | 75.59 | 83.03 | 91.21 | 100.19 |
| Depreciation | 2.70 | 3.59 | 4.70 | 4.07 | 3.76 | 5.12 | 5.62 | 6.17 | 6.78 | 7.45 |
| Accounts Receivable | - | -22.57 | -20.38 | 2.41 | -8.35 | -7.80 | -9.97 | -10.95 | -12.03 | -13.22 |
| Inventories | - | - | - | - | - | - | - | - | - | - |
| Accounts Payable | - | 25.91 | 23.89 | 0.05 | -5.87 | 19.84 | 11.42 | 12.55 | 13.78 | 15.14 |
| Capital Expenditure | -0.19 | -0.20 | -3.16 | -0.25 | -0.78 | -1.23 | -1.35 | -1.48 | -1.63 | -1.79 |
| UFCF | 43.52 | 54.98 | 46.53 | 59.13 | 61.61 | 84.75 | 81.32 | 89.32 | 98.12 | 107.78 |
| WACC | ||||||||||
| PV UFCF | 77.99 | 68.86 | 69.60 | 70.36 | 71.12 | |||||
| SUM PV UFCF | 357.92 |
Terminal Value
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 8.67 |
| Free cash flow (t + 1) | 109.93 |
| Terminal Value | 1,648.18 |
| Present Value of Terminal Value | 1,087.57 |
Intrinsic Value
| Enterprise Value | 1,445.49 |
|---|---|
| Net Debt | -267.25 |
| Equity Value | 1,712.75 |
| Shares Outstanding | 60.84 |
| Equity Value Per Share | 28.15 |