Discounted Cash Flow (DCF) Analysis Unlevered

The Interpublic Group of Companies,... (IPG)

$38.67

+0.92 (+2.44%)
All numbers are in Millions, Currency in USD
Stock DCF: 45.02 | 38.67 | undervalue

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 9,714.4010,221.309,06110,240.7010,927.8011,299.2211,683.2612,080.3512,490.9412,915.48
Revenue (%)
EBITDA 1,1441,338.60841.901,661.501,705.101,491.311,5421,594.411,648.601,704.63
EBITDA (%)
EBIT 941.101,060.10551.301,377.701,431.101,190.771,231.241,273.091,316.361,361.10
EBIT (%)
Depreciation 202.90278.50290.60283.80274300.54310.76321.32332.24343.53
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 673.401,192.202,5093,2702,545.302,293.952,371.922,452.542,535.892,622.08
Total Cash (%)
Account Receivables 7,027.207,143.306,467.107,524.907,3398,005.198,277.278,558.608,849.509,150.27
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 6,698.107,205.407,269.708,9608,235.308,644.588,938.399,242.199,556.319,881.12
Accounts Payable (%)
Capital Expenditure -177.10-198.50-167.50-195.30-178.10-206.79-213.82-221.08-228.60-236.37
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 38.67
Beta 1.116
Diluted Shares Outstanding 395.10
Cost of Debt
Tax Rate 26.08
After-tax Cost of Debt 2.85%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.959
Total Debt 4,531.60
Total Equity 15,278.52
Total Capital 19,810.12
Debt Weighting 22.88
Equity Weighting 77.12
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 9,714.4010,221.309,06110,240.7010,927.8011,299.2211,683.2612,080.3512,490.9412,915.48
EBITDA 1,1441,338.60841.901,661.501,705.101,491.311,5421,594.411,648.601,704.63
EBIT 941.101,060.10551.301,377.701,431.101,190.771,231.241,273.091,316.361,361.10
Tax Rate 26.15%25.31%2.82%22.04%26.08%20.48%20.48%20.48%20.48%20.48%
EBIAT 695.04791.79535.741,074.111,057.90946.92979.101,012.381,046.791,082.37
Depreciation 202.90278.50290.60283.80274300.54310.76321.32332.24343.53
Accounts Receivable --116.10676.20-1,057.80185.90-666.19-272.08-281.33-290.89-300.78
Inventories ----------
Accounts Payable -507.3064.301,690.30-724.70409.28293.81303.80314.13324.80
Capital Expenditure -177.10-198.50-167.50-195.30-178.10-206.79-213.82-221.08-228.60-236.37
UFCF 720.841,262.991,399.341,795.11615783.751,097.771,135.081,173.661,213.55
WACC
PV UFCF 728.67948.88912.17876.88842.96
SUM PV UFCF 4,309.55

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.56
Free cash flow (t + 1) 1,237.83
Terminal Value 22,263.04
Present Value of Terminal Value 15,464.31

Intrinsic Value

Enterprise Value 19,773.86
Net Debt 1,986.30
Equity Value 17,787.56
Shares Outstanding 395.10
Equity Value Per Share 45.02