Discounted Cash Flow (DCF) Analysis Unlevered

Microsoft Corporation (MSFT)

$248.16

+0.16 (+0.06%)
All numbers are in Millions, Currency in USD
Stock DCF: 209.49 | 248.16 | 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 110,360125,843143,015168,088198,270229,578.28265,830.36307,806.91356,411.86412,691.88
Revenue (%)
EBITDA 49,46858,05668,42385,134100,239110,200.51127,601.98147,751.26171,082.26198,097.39
EBITDA (%)
EBIT 39,20746,37455,62773,44885,77991,019.96105,392.67122,034.94141,305.15163,618.26
EBIT (%)
Depreciation 10,26111,68212,79611,68614,46019,180.5622,209.3025,716.3229,777.1134,479.13
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 133,768133,819136,527130,334104,749208,173.63241,045.77279,108.65323,181.93374,214.71
Total Cash (%)
Account Receivables 26,48129,52432,01138,04344,26152,709.0861,032.2370,669.6681,828.9194,750.29
Account Receivables (%)
Inventories 2,6622,0631,8952,6363,7424,055.294,695.655,437.126,295.687,289.82
Inventories (%)
Accounts Payable 8,6179,38212,53015,16319,00019,573.1522,663.8926,242.6830,386.6035,184.86
Accounts Payable (%)
Capital Expenditure -11,632-13,925-15,441-20,622-23,886-26,042.43-30,154.72-34,916.37-40,429.92-46,814.10
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 248.16
Beta 0.926
Diluted Shares Outstanding 7,540
Cost of Debt
Tax Rate 13.11
After-tax Cost of Debt 2.93%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.891
Total Debt 61,270
Total Equity 1,871,126.40
Total Capital 1,932,396.40
Debt Weighting 3.17
Equity Weighting 96.83
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 110,360125,843143,015168,088198,270229,578.28265,830.36307,806.91356,411.86412,691.88
EBITDA 49,46858,05668,42385,134100,239110,200.51127,601.98147,751.26171,082.26198,097.39
EBIT 39,20746,37455,62773,44885,77991,019.96105,392.67122,034.94141,305.15163,618.26
Tax Rate 54.57%10.18%16.51%13.83%13.11%21.64%21.64%21.64%21.64%21.64%
EBIAT 17,812.6741,652.5346,444.2963,292.6374,530.4771,323.8682,586.4295,627.42110,727.68128,212.39
Depreciation 10,26111,68212,79611,68614,46019,180.5622,209.3025,716.3229,777.1134,479.13
Accounts Receivable --3,043-2,487-6,032-6,218-8,448.08-8,323.15-9,637.43-11,159.25-12,921.38
Inventories -599168-741-1,106-313.29-640.36-741.48-858.56-994.13
Accounts Payable -7653,1482,6333,837573.153,090.743,578.794,143.914,798.26
Capital Expenditure -11,632-13,925-15,441-20,622-23,886-26,042.43-30,154.72-34,916.37-40,429.92-46,814.10
UFCF 16,441.6737,730.5344,628.2950,216.6361,617.4756,273.7768,768.2479,627.2592,200.97106,760.17
WACC
PV UFCF 52,235.9359,253.5863,687.1468,452.4373,574.27
SUM PV UFCF 317,203.35

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.73
Free cash flow (t + 1) 108,895.38
Terminal Value 1,900,442.88
Present Value of Terminal Value 1,309,699.08

Intrinsic Value

Enterprise Value 1,626,902.42
Net Debt 47,339
Equity Value 1,579,563.42
Shares Outstanding 7,540
Equity Value Per Share 209.49