Discounted Cash Flow (DCF) Analysis Unlevered

Linamar Corporation (LNR.TO)

$67.73

+1.33 (+2.00%)

All numbers are in Millions, Currency in USD

Stock DCF: 95.35 | 67.73 | 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	6,546.46	7,620.58	7,416.62	5,815.57	6,536.57	6,610.79	6,685.85	6,761.77	6,838.54	6,916.19
Revenue (%)
EBITDA	1,041.73	1,186.82	1,035.65	873.15	1,029.36	1,007.65	1,019.09	1,030.66	1,042.36	1,054.20
EBITDA (%)
EBIT	721.95	828	633.13	418.53	580.60	614.92	621.91	628.97	636.11	643.33
EBIT (%)
Depreciation	319.78	358.82	402.52	454.63	448.75	392.72	397.18	401.69	406.25	410.87
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	439.06	471.98	338.23	861.10	928.43	614.42	621.40	628.45	635.59	642.81
Total Cash (%)
Account Receivables	1,083	1,286	988	888	871	996.04	1,007.35	1,018.79	1,030.36	1,042.05
Account Receivables (%)
Inventories	791.67	1,218.96	991.76	864.16	1,066.46	960.35	971.26	982.29	993.44	1,004.72
Inventories (%)
Accounts Payable	782.44	912.02	772.31	865.50	984.49	849.84	859.49	869.25	879.12	889.10
Accounts Payable (%)
Capital Expenditure	-427.40	-558.03	-558.97	-291.65	-254.54	-400.58	-405.13	-409.72	-414.38	-419.08
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 67.73
Beta	1.391
Diluted Shares Outstanding	65.57
Cost of Debt
Tax Rate	25.19
After-tax Cost of Debt	1.74%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.302
Total Debt	791.54
Total Equity	4,440.94
Total Capital	5,232.49
Debt Weighting	15.13
Equity Weighting	84.87
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	6,546.46	7,620.58	7,416.62	5,815.57	6,536.57	6,610.79	6,685.85	6,761.77	6,838.54	6,916.19
EBITDA	1,041.73	1,186.82	1,035.65	873.15	1,029.36	1,007.65	1,019.09	1,030.66	1,042.36	1,054.20
EBIT	721.95	828	633.13	418.53	580.60	614.92	621.91	628.97	636.11	643.33
Tax Rate	20.68%	22.13%	23.74%	25.44%	25.19%	23.43%	23.43%	23.43%	23.43%	23.43%
EBIAT	572.69	644.79	482.85	312.05	434.35	470.82	476.17	481.57	487.04	492.57
Depreciation	319.78	358.82	402.52	454.63	448.75	392.72	397.18	401.69	406.25	410.87
Accounts Receivable	-	-203	298	100	17	-125.04	-11.31	-11.44	-11.57	-11.70
Inventories	-	-427.29	227.20	127.60	-202.30	106.10	-10.90	-11.03	-11.15	-11.28
Accounts Payable	-	129.58	-139.71	93.19	118.99	-134.64	9.65	9.76	9.87	9.98
Capital Expenditure	-427.40	-558.03	-558.97	-291.65	-254.54	-400.58	-405.13	-409.72	-414.38	-419.08
UFCF	465.07	-55.13	711.89	795.82	562.25	309.39	455.66	460.84	466.07	471.36
WACC
PV UFCF						283.81	383.45	355.75	330.05	306.21
SUM PV UFCF										1,659.28

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	9.01
Free cash flow (t + 1)	480.79
Terminal Value	6,858.59
Present Value of Terminal Value	4,455.57

Intrinsic Value

Enterprise Value	6,114.85
Net Debt	-136.88
Equity Value	6,251.74
Shares Outstanding	65.57
Equity Value Per Share	95.35