Discounted Cash Flow (DCF) Analysis Unlevered
Largo Inc. (LGO.TO)
$7.91
-0.42 (-5.04%)
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 | 133.38 | 382.82 | 107.18 | 119.99 | 198.28 | 293.56 | 434.63 | 643.48 | 952.70 | 1,410.50 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (%) | ||||||||||
| EBITDA | 48.55 | 284.94 | 7.27 | 26.37 | 55.25 | 98.32 | 145.56 | 215.51 | 319.07 | 472.39 |
| EBITDA (%) | ||||||||||
| EBIT | 22.12 | 262.15 | -16.99 | 8.86 | 32.74 | 54.67 | 80.94 | 119.83 | 177.41 | 262.66 |
| EBIT (%) | ||||||||||
| Depreciation | 26.42 | 22.79 | 24.27 | 17.51 | 22.51 | 43.65 | 64.62 | 95.68 | 141.66 | 209.73 |
| 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 | 43.52 | 151.38 | 127.14 | 79.15 | 83.79 | 175.55 | 259.91 | 384.81 | 569.73 | 843.50 |
|---|---|---|---|---|---|---|---|---|---|---|
| Total Cash (%) | ||||||||||
| Account Receivables | 11.88 | 45.93 | 6.14 | 19.10 | 23.68 | 31.99 | 47.37 | 70.13 | 103.83 | 153.72 |
| Account Receivables (%) | ||||||||||
| Inventories | 10.94 | 10.55 | 21.18 | 35.34 | 45.32 | 48.75 | 72.18 | 106.86 | 158.21 | 234.23 |
| Inventories (%) | ||||||||||
| Accounts Payable | 16.65 | 17.70 | 74.91 | 12.29 | 14.05 | 61.25 | 90.68 | 134.25 | 198.77 | 294.28 |
| Accounts Payable (%) | ||||||||||
| Capital Expenditure | -15.43 | -13.94 | -38.57 | -18.11 | -27.40 | -47.03 | -69.63 | -103.10 | -152.64 | -225.99 |
| Capital Expenditure (%) |
Weighted Average Cost Of Capital
| Share price | $ 7.91 |
|---|---|
| Beta | 1.647 |
| Diluted Shares Outstanding | 65.05 |
| Cost of Debt | |
| Tax Rate | 28.93 |
| After-tax Cost of Debt | 3.97% |
| Risk-Free Rate | |
| Market Risk Premium | |
| Cost of Equity | 11.408 |
| Total Debt | 17.55 |
| Total Equity | 514.51 |
| Total Capital | 532.06 |
| Debt Weighting | 3.30 |
| Equity Weighting | 96.70 |
| 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 | 133.38 | 382.82 | 107.18 | 119.99 | 198.28 | 293.56 | 434.63 | 643.48 | 952.70 | 1,410.50 |
|---|---|---|---|---|---|---|---|---|---|---|
| EBITDA | 48.55 | 284.94 | 7.27 | 26.37 | 55.25 | 98.32 | 145.56 | 215.51 | 319.07 | 472.39 |
| EBIT | 22.12 | 262.15 | -16.99 | 8.86 | 32.74 | 54.67 | 80.94 | 119.83 | 177.41 | 262.66 |
| Tax Rate | -15.26% | 2.08% | -15.85% | 12.46% | 28.93% | 2.47% | 2.47% | 2.47% | 2.47% | 2.47% |
| EBIAT | 25.50 | 256.71 | -19.68 | 7.76 | 23.27 | 53.32 | 78.94 | 116.87 | 173.03 | 256.17 |
| Depreciation | 26.42 | 22.79 | 24.27 | 17.51 | 22.51 | 43.65 | 64.62 | 95.68 | 141.66 | 209.73 |
| Accounts Receivable | - | -34.05 | 39.79 | -12.96 | -4.59 | -8.31 | -15.37 | -22.76 | -33.70 | -49.89 |
| Inventories | - | 0.39 | -10.63 | -14.15 | -9.99 | -3.43 | -23.43 | -34.68 | -51.35 | -76.02 |
| Accounts Payable | - | 1.05 | 57.21 | -62.62 | 1.76 | 47.20 | 29.43 | 43.57 | 64.51 | 95.51 |
| Capital Expenditure | -15.43 | -13.94 | -38.57 | -18.11 | -27.40 | -47.03 | -69.63 | -103.10 | -152.64 | -225.99 |
| UFCF | 36.49 | 232.95 | 52.38 | -82.57 | 5.57 | 85.39 | 64.56 | 95.58 | 141.51 | 209.51 |
| WACC | ||||||||||
| PV UFCF | 76.82 | 52.25 | 69.59 | 92.68 | 123.44 | |||||
| SUM PV UFCF | 414.78 |
Terminal Value
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 11.16 |
| Free cash flow (t + 1) | 213.70 |
| Terminal Value | 2,333 |
| Present Value of Terminal Value | 1,374.59 |
Intrinsic Value
| Enterprise Value | 1,789.36 |
|---|---|
| Net Debt | -66.24 |
| Equity Value | 1,855.60 |
| Shares Outstanding | 65.05 |
| Equity Value Per Share | 28.53 |