Discounted Cash Flow (DCF) Analysis Unlevered

International Paper Company (IP)

$36.52

-0.58 (-1.56%)
All numbers are in Millions, Currency in USD
Stock DCF: 106.05 | 36.52 | 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 21,74323,30622,37620,58019,36318,843.0118,336.9917,844.5617,365.3516,899.01
Revenue (%)
EBITDA 3,2404,5193,8712,6143,5803,119.713,035.932,954.402,875.062,797.85
EBITDA (%)
EBIT 1,8173,1912,5651,3272,3701,967.191,914.361,862.951,812.931,764.24
EBIT (%)
Depreciation 1,4231,3281,3061,2871,2101,152.521,121.561,091.451,062.141,033.61
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 1,0185895115,4451,5401,654.571,610.131,566.891,524.821,483.87
Total Cash (%)
Account Receivables 3,2873,9163,6733,4193,6103,150.253,065.652,983.322,903.212,825.24
Account Receivables (%)
Inventories 2,3132,2412,2082,0501,8141,863.601,813.551,764.851,717.461,671.34
Inventories (%)
Accounts Payable 2,4582,4132,4232,3202,6062,156.342,098.442,042.081,987.241,933.88
Accounts Payable (%)
Capital Expenditure -1,391-1,572-1,276-751-549-954.57-928.93-903.99-879.71-856.09
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 36.52
Beta 0.989
Diluted Shares Outstanding 392.40
Cost of Debt
Tax Rate -75.38
After-tax Cost of Debt 5.43%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.265
Total Debt 7,914
Total Equity 14,330.45
Total Capital 22,244.45
Debt Weighting 35.58
Equity Weighting 64.42
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 21,74323,30622,37620,58019,36318,843.0118,336.9917,844.5617,365.3516,899.01
EBITDA 3,2404,5193,8712,6143,5803,119.713,035.932,954.402,875.062,797.85
EBIT 1,8173,1912,5651,3272,3701,967.191,914.361,862.951,812.931,764.24
Tax Rate -152.83%-12.97%23.63%25.85%-75.38%-38.34%-38.34%-38.34%-38.34%-38.34%
EBIAT 4,593.923,604.881,958.93984.024,156.402,721.422,648.342,577.222,508.012,440.65
Depreciation 1,4231,3281,3061,2871,2101,152.521,121.561,091.451,062.141,033.61
Accounts Receivable --629243254-191459.7584.6082.3380.1277.96
Inventories -7233158236-49.6050.0548.7047.3946.12
Accounts Payable --4510-103286-449.66-57.91-56.35-54.84-53.37
Capital Expenditure -1,391-1,572-1,276-751-549-954.57-928.93-903.99-879.71-856.09
UFCF 4,625.922,758.882,274.931,829.025,148.402,879.862,917.702,839.352,763.102,688.90
WACC
PV UFCF 2,684.932,536.092,300.942,087.591,894.02
SUM PV UFCF 11,503.58

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.26
Free cash flow (t + 1) 2,742.68
Terminal Value 52,142.12
Present Value of Terminal Value 36,728.20

Intrinsic Value

Enterprise Value 48,231.78
Net Debt 6,619
Equity Value 41,612.78
Shares Outstanding 392.40
Equity Value Per Share 106.05