Discounted Cash Flow (DCF) Analysis Unlevered

Humana Inc. (HUM)

$476.57

-13.20 (-2.70%)
All numbers are in Millions, Currency in USD
Stock DCF: 1,236.14 | 476.57 | undervalue

Operating Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 53,76756,91264,88877,15583,06492,705.12103,465.27115,474.33128,877.27143,835.87
Revenue (%)
EBITDA 4,7472,8264,2875,5734,4576,116.696,826.647,6198,503.339,490.30
EBITDA (%)
EBIT 4,2622,2923,7124,9573,7445,303.995,919.626,606.707,373.538,229.37
EBIT (%)
Depreciation 485534575616713812.70907.031,012.301,129.801,260.93
Depreciation (%)

Balance Sheet Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Total Cash 13,59912,36915,02617,22716,58620,854.6423,275.2125,976.7328,991.8132,356.85
Total Cash (%)
Account Receivables 8541,0151,0561,1381,8141,605.291,791.611,999.562,231.642,490.67
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 11,6608,1489,96412,15612,79815,300.3117,076.2019,058.2021,270.2623,739.07
Accounts Payable (%)
Capital Expenditure -526-612-736-964-1,316-1,116.48-1,246.06-1,390.69-1,552.11-1,732.26
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 476.57
Beta 0.740
Diluted Shares Outstanding 129.40
Cost of Debt
Tax Rate 12.55
After-tax Cost of Debt 2.22%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.109
Total Debt 12,820
Total Equity 61,666.25
Total Capital 74,486.25
Debt Weighting 17.21
Equity Weighting 82.79
Wacc

Build Up Free Cash

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 53,76756,91264,88877,15583,06492,705.12103,465.27115,474.33128,877.27143,835.87
EBITDA 4,7472,8264,2875,5734,4576,116.696,826.647,6198,503.339,490.30
EBIT 4,2622,2923,7124,9573,7445,303.995,919.626,606.707,373.538,229.37
Tax Rate 39.10%18.42%21.67%26.80%12.55%23.71%23.71%23.71%23.71%23.71%
EBIAT 2,595.371,869.822,907.523,628.313,274.054,046.384,516.045,040.215,625.226,278.13
Depreciation 485534575616713812.70907.031,012.301,129.801,260.93
Accounts Receivable --161-41-82-676208.71-186.32-207.95-232.09-259.02
Inventories ----------
Accounts Payable --3,5121,8162,1926422,502.311,775.891,982.012,212.062,468.81
Capital Expenditure -526-612-736-964-1,316-1,116.48-1,246.06-1,390.69-1,552.11-1,732.26
UFCF 2,554.37-1,881.184,521.525,390.312,637.056,453.635,766.566,435.887,182.888,016.59
WACC
PV UFCF 6,072.865,106.175,362.615,631.915,914.75
SUM PV UFCF 28,088.30

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.27
Free cash flow (t + 1) 8,176.92
Terminal Value 191,496.97
Present Value of Terminal Value 141,289.05

Intrinsic Value

Enterprise Value 169,377.35
Net Debt 9,426
Equity Value 159,951.35
Shares Outstanding 129.40
Equity Value Per Share 1,236.14