Discounted Cash Flow (DCF) Analysis Unlevered

Mercury General Corporation (MCY)

$33.22

+0.29 (+0.88%)
All numbers are in Millions, Currency in USD
Stock DCF: 165.01 | 33.22 | 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 3,415.963,3803,972.523,784.513,993.364,165.704,345.484,533.024,728.664,932.74
Revenue (%)
EBITDA 237.6045.21459.83544.01395.48367.80383.68400.23417.51435.53
EBITDA (%)
EBIT 182.25-13.58395.10475.55316.42294.67307.39320.66334.49348.93
EBIT (%)
Depreciation 55.3458.7964.7368.4679.0673.1376.2979.5883.0186.60
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 594.12567.59788.53724.09475.68708.83739.42771.34804.63839.35
Total Cash (%)
Account Receivables 598.32821.14697.75648.29688.45781.02814.73849.89886.57924.83
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 108.25115.07143.32194.42169.13162.91169.94177.27184.93192.91
Accounts Payable (%)
Capital Expenditure -19.44-27.96-40.09-39.95-41.44-37.48-39.10-40.79-42.55-44.38
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 33.22
Beta 0.416
Diluted Shares Outstanding 55.36
Cost of Debt
Tax Rate 17.16
After-tax Cost of Debt 3.48%
Risk-Free Rate
Market Risk Premium
Cost of Equity 4.813
Total Debt 407.51
Total Equity 1,838.99
Total Capital 2,246.50
Debt Weighting 18.14
Equity Weighting 81.86
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 3,415.963,3803,972.523,784.513,993.364,165.704,345.484,533.024,728.664,932.74
EBITDA 237.6045.21459.83544.01395.48367.80383.68400.23417.51435.53
EBIT 182.25-13.58395.10475.55316.42294.67307.39320.66334.49348.93
Tax Rate 13.29%81.29%15.34%18.30%17.16%29.08%29.08%29.08%29.08%29.08%
EBIAT 158.03-2.54334.51388.54262.11208.99218.01227.42237.24247.48
Depreciation 55.3458.7964.7368.4679.0673.1376.2979.5883.0186.60
Accounts Receivable --222.82123.3949.46-40.16-92.57-33.71-35.16-36.68-38.26
Inventories ----------
Accounts Payable -6.8228.2551.10-25.30-6.227.037.337.657.98
Capital Expenditure -19.44-27.96-40.09-39.95-41.44-37.48-39.10-40.79-42.55-44.38
UFCF 193.93-187.71510.79517.61234.27145.86228.52238.39248.67259.41
WACC
PV UFCF 139.48208.99208.48207.97207.47
SUM PV UFCF 972.38

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 4.57
Free cash flow (t + 1) 264.59
Terminal Value 10,295.52
Present Value of Terminal Value 8,234.03

Intrinsic Value

Enterprise Value 9,206.41
Net Debt 71.95
Equity Value 9,134.46
Shares Outstanding 55.36
Equity Value Per Share 165.01