Discounted Cash Flow (DCF) Analysis Unlevered

Mercer International Inc. (MERC)

$12.34

-0.13 (-1.04%)
All numbers are in Millions, Currency in USD
Stock DCF: 20.56 | 12.34 | 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 1,169.141,457.721,624.411,423.141,803.252,030.632,286.682,575.012,899.703,265.33
Revenue (%)
EBITDA 244.02325.46211.73198.53462.81389.27438.35493.62555.86625.95
EBITDA (%)
EBIT 158.73228.7385.3469.61330.61234.52264.10297.40334.90377.12
EBIT (%)
Depreciation 85.2996.73126.39128.92132.20154.74174.25196.23220.97248.83
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 143.30240.49351.09361.10345.61385.44434.04488.77550.40619.80
Total Cash (%)
Account Receivables 206.03252.69208.74227.05345.35336.73379.19427480.84541.47
Account Receivables (%)
Inventories 176.60303.81272.60271.70356.73372.02418.93471.75531.24598.22
Inventories (%)
Accounts Payable 36.1536.3373.7242.7358.4566.4774.8584.2994.92106.89
Accounts Payable (%)
Capital Expenditure -59.69-87.61-132.66-79.16-160.82-137.12-154.41-173.88-195.81-220.50
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 12.34
Beta 1.522
Diluted Shares Outstanding 66.04
Cost of Debt
Tax Rate 34.38
After-tax Cost of Debt 3.66%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.680
Total Debt 1,255.78
Total Equity 814.90
Total Capital 2,070.67
Debt Weighting 60.65
Equity Weighting 39.35
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 1,169.141,457.721,624.411,423.141,803.252,030.632,286.682,575.012,899.703,265.33
EBITDA 244.02325.46211.73198.53462.81389.27438.35493.62555.86625.95
EBIT 158.73228.7385.3469.61330.61234.52264.10297.40334.90377.12
Tax Rate 32.19%27.46%200.54%-54.73%34.38%47.97%47.97%47.97%47.97%47.97%
EBIAT 107.64165.92-85.80107.70216.95122.03137.41154.74174.25196.22
Depreciation 85.2996.73126.39128.92132.20154.74174.25196.23220.97248.83
Accounts Receivable --46.6743.95-18.32-118.298.61-42.46-47.81-53.84-60.63
Inventories --127.2131.210.90-85.03-15.29-46.91-52.82-59.48-66.98
Accounts Payable -0.1837.39-30.9915.728.028.389.4410.6311.97
Capital Expenditure -59.69-87.61-132.66-79.17-160.82-137.12-154.41-173.88-195.81-220.50
UFCF 133.241.3420.49109.050.72140.9976.2785.8996.71108.91
WACC
PV UFCF 132.4967.3471.2675.4179.79
SUM PV UFCF 426.29

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.42
Free cash flow (t + 1) 111.09
Terminal Value 2,513.30
Present Value of Terminal Value 1,841.32

Intrinsic Value

Enterprise Value 2,267.60
Net Debt 910.17
Equity Value 1,357.44
Shares Outstanding 66.04
Equity Value Per Share 20.56