Discounted Cash Flow (DCF) Analysis Unlevered
Ironwood Pharmaceuticals, Inc. (IRWD)
$11.87
+0.39 (+3.40%)
All numbers are in Millions, Currency in USD
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 | 298.28 | 346.64 | 428.41 | 389.52 | 413.75 | 451.97 | 493.72 | 539.32 | 589.14 | 643.56 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (%) | ||||||||||
| EBITDA | -65.95 | -230.42 | 63.69 | 141.90 | 233.33 | 17.27 | 18.87 | 20.61 | 22.51 | 24.59 |
| EBITDA (%) | ||||||||||
| EBIT | -80.57 | -244.64 | 58.11 | 138.34 | 231.81 | 6.79 | 7.42 | 8.11 | 8.86 | 9.68 |
| EBIT (%) | ||||||||||
| Depreciation | 14.62 | 14.22 | 5.58 | 3.56 | 1.52 | 10.48 | 11.44 | 12.50 | 13.66 | 14.92 |
| 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 | 221.42 | 173.17 | 177.02 | 362.56 | 620.13 | 369.23 | 403.34 | 440.59 | 481.29 | 525.75 |
|---|---|---|---|---|---|---|---|---|---|---|
| Total Cash (%) | ||||||||||
| Account Receivables | 82.16 | 80.95 | 117.25 | 122.35 | 114.04 | 124.05 | 135.51 | 148.03 | 161.70 | 176.64 |
| Account Receivables (%) | ||||||||||
| Inventories | 0.73 | 0.85 | 1.06 | 0.96 | 1.02 | 1.11 | 1.22 | 1.33 | 1.45 | 1.59 |
| Inventories (%) | ||||||||||
| Accounts Payable | 15.96 | 18.12 | 5.49 | 0.66 | 0.93 | 11.08 | 12.10 | 13.22 | 14.44 | 15.77 |
| Accounts Payable (%) | ||||||||||
| Capital Expenditure | -4.21 | -8.62 | -7.19 | -1.84 | -0.27 | -5.53 | -6.04 | -6.59 | -7.20 | -7.87 |
| Capital Expenditure (%) |
Weighted Average Cost Of Capital
| Share price | $ 11.87 |
|---|---|
| Beta | 1.050 |
| Diluted Shares Outstanding | 164.42 |
| Cost of Debt | |
| Tax Rate | -163.36 |
| After-tax Cost of Debt | 6.55% |
| Risk-Free Rate | |
| Market Risk Premium | |
| Cost of Equity | 7.797 |
| Total Debt | 475.80 |
| Total Equity | 1,951.64 |
| Total Capital | 2,427.44 |
| Debt Weighting | 19.60 |
| Equity Weighting | 80.40 |
| 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 | 298.28 | 346.64 | 428.41 | 389.52 | 413.75 | 451.97 | 493.72 | 539.32 | 589.14 | 643.56 |
|---|---|---|---|---|---|---|---|---|---|---|
| EBITDA | -65.95 | -230.42 | 63.69 | 141.90 | 233.33 | 17.27 | 18.87 | 20.61 | 22.51 | 24.59 |
| EBIT | -80.57 | -244.64 | 58.11 | 138.34 | 231.81 | 6.79 | 7.42 | 8.11 | 8.86 | 9.68 |
| Tax Rate | 0.00% | 0.00% | 63.52% | 2.47% | -163.36% | -19.48% | -19.48% | -19.48% | -19.48% | -19.48% |
| EBIAT | -80.57 | -244.64 | 21.20 | 134.93 | 610.48 | 8.12 | 8.87 | 9.69 | 10.58 | 11.56 |
| Depreciation | 14.62 | 14.22 | 5.58 | 3.56 | 1.52 | 10.48 | 11.44 | 12.50 | 13.66 | 14.92 |
| Accounts Receivable | - | 1.21 | -36.30 | -5.11 | 8.31 | -10.01 | -11.46 | -12.52 | -13.67 | -14.94 |
| Inventories | - | -0.12 | -0.20 | 0.10 | -0.06 | -0.09 | -0.10 | -0.11 | -0.12 | -0.13 |
| Accounts Payable | - | 2.17 | -12.64 | -4.83 | 0.27 | 10.14 | 1.02 | 1.12 | 1.22 | 1.33 |
| Capital Expenditure | -4.21 | -8.62 | -7.19 | -1.84 | -0.27 | -5.53 | -6.04 | -6.59 | -7.20 | -7.87 |
| UFCF | -70.16 | -235.79 | -29.54 | 126.81 | 620.27 | 13.10 | 3.74 | 4.08 | 4.46 | 4.87 |
| WACC | ||||||||||
| PV UFCF | 12.18 | 3.23 | 3.28 | 3.33 | 3.38 | |||||
| SUM PV UFCF | 25.41 |
Terminal Value
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 7.55 |
| Free cash flow (t + 1) | 4.97 |
| Terminal Value | 89.50 |
| Present Value of Terminal Value | 62.20 |
Intrinsic Value
| Enterprise Value | 87.61 |
|---|---|
| Net Debt | -144.33 |
| Equity Value | 231.94 |
| Shares Outstanding | 164.42 |
| Equity Value Per Share | 1.41 |