Discounted Cash Flow (DCF) Analysis Unlevered

McKesson Corporation (MCK)

$386.85

+7.13 (+1.88%)
All numbers are in Millions, Currency in USD
Stock DCF: 16.52 | 386.85 | overvalue

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 208,357214,319231,051238,228263,966280,185.83297,402.31315,676.69335,073.97355,663.15
Revenue (%)
EBITDA 1,2481,6032,089-4,1302,688860.58913.46969.591,029.171,092.41
EBITDA (%)
EBIT 2976541,167-5,0171,928-236.92-251.48-266.93-283.33-300.74
EBIT (%)
Depreciation 9519499228877601,097.501,164.941,236.521,312.501,393.15
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 2,6722,9814,0156,2783,5324,698.374,987.075,293.515,618.785,964.03
Total Cash (%)
Account Receivables 17,71118,24619,95019,18118,58322,829.3724,232.1625,721.1527,301.6328,979.22
Account Receivables (%)
Inventories 16,31016,70916,73419,24618,70221,311.2822,620.7824,010.7525,486.1427,052.17
Inventories (%)
Accounts Payable 32,17733,85337,19538,97538,08643,779.4546,469.5549,324.9552,355.8155,572.90
Accounts Payable (%)
Capital Expenditure -580-557-506-641-535-688.70-731.02-775.94-823.62-874.23
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 386.85
Beta 0.655
Diluted Shares Outstanding 154.10
Cost of Debt
Tax Rate 42.22
After-tax Cost of Debt 1.36%
Risk-Free Rate
Market Risk Premium
Cost of Equity 6.598
Total Debt 7,542
Total Equity 59,613.58
Total Capital 67,155.59
Debt Weighting 11.23
Equity Weighting 88.77
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 208,357214,319231,051238,228263,966280,185.83297,402.31315,676.69335,073.97355,663.15
EBITDA 1,2481,6032,089-4,1302,688860.58913.46969.591,029.171,092.41
EBIT 2976541,167-5,0171,928-236.92-251.48-266.93-283.33-300.74
Tax Rate 71.97%94.43%21.33%9.83%42.22%47.95%47.95%47.95%47.95%47.95%
EBIAT 83.2636.45918.09-4,523.671,114-123.31-130.88-138.92-147.46-156.52
Depreciation 9519499228877601,097.501,164.941,236.521,312.501,393.15
Accounts Receivable --535-1,704769598-4,246.37-1,402.79-1,488.99-1,580.48-1,677.59
Inventories --399-25-2,512544-2,609.28-1,309.51-1,389.97-1,475.38-1,566.04
Accounts Payable -1,6763,3421,780-8895,693.452,690.102,855.403,030.853,217.09
Capital Expenditure -580-557-506-641-535-688.70-731.02-775.94-823.62-874.23
UFCF 454.261,170.452,947.09-4,240.671,592-876.70280.84298.10316.41335.86
WACC
PV UFCF -827249.90250.22250.53250.85
SUM PV UFCF 174.50

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.01
Free cash flow (t + 1) 342.57
Terminal Value 8,542.98
Present Value of Terminal Value 6,380.80

Intrinsic Value

Enterprise Value 6,555.30
Net Debt 4,010
Equity Value 2,545.30
Shares Outstanding 154.10
Equity Value Per Share 16.52