Discounted Cash Flow (DCF) Analysis Unlevered

Meritage Homes Corporation (MTH)

$86.3

+0.19 (+0.22%)
All numbers are in Millions, Currency in USD
Stock DCF: -4.79 | 86.3 | overvalue

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 3,254.833,543.923,677.844,506.315,147.335,783.176,497.567,300.198,201.979,215.15
Revenue (%)
EBITDA 268.08311.01339.24566.79981.40669.46752.15845.07949.461,066.74
EBITDA (%)
EBIT 251.37284.04311.31535.74955.15632.07710.15797.87896.431,007.17
EBIT (%)
Depreciation 16.7026.9727.9231.0526.2437.394247.1953.0259.57
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 170.75311.47319.47745.62624.10594.41667.84750.34843.03947.17
Total Cash (%)
Account Receivables 79.3277.2888.4998.57147.55139.69156.95176.34198.12222.60
Account Receivables (%)
Inventories 2,731.382,742.622,744.362,778.043,734.414,280.984,809.815,403.956,071.506,821.50
Inventories (%)
Accounts Payable 140.52128.17155.02175.25216.01234.04262.95295.43331.92372.93
Accounts Payable (%)
Capital Expenditure -18.10-33.41-24.38-19.93-25.66-35.89-40.32-45.30-50.90-57.19
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 86.3
Beta 1.617
Diluted Shares Outstanding 37.72
Cost of Debt
Tax Rate 22.77
After-tax Cost of Debt 0.02%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.510
Total Debt 1,186.21
Total Equity 3,255.06
Total Capital 4,441.27
Debt Weighting 26.71
Equity Weighting 73.29
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 3,254.833,543.923,677.844,506.315,147.335,783.176,497.567,300.198,201.979,215.15
EBITDA 268.08311.01339.24566.79981.40669.46752.15845.07949.461,066.74
EBIT 251.37284.04311.31535.74955.15632.07710.15797.87896.431,007.17
Tax Rate 42.12%19.74%17.59%20.63%22.77%24.57%24.57%24.57%24.57%24.57%
EBIAT 145.48227.96256.56425.20737.69476.77535.66601.83676.17759.70
Depreciation 16.7026.9727.9231.0526.2437.394247.1953.0259.57
Accounts Receivable -2.03-11.21-10.08-48.987.85-17.26-19.39-21.78-24.47
Inventories --11.24-1.74-33.68-956.37-546.57-528.82-594.15-667.54-750
Accounts Payable --12.3526.8620.2340.7618.0328.9132.4836.4941
Capital Expenditure -18.10-33.41-24.39-19.93-25.66-35.89-40.32-45.30-50.90-57.19
UFCF 144.09199.96274.01412.79-226.31-42.4320.1722.6625.4628.61
WACC
PV UFCF -39.3917.3918.1418.9219.74
SUM PV UFCF 34.79

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.71
Free cash flow (t + 1) 29.18
Terminal Value 511.07
Present Value of Terminal Value 352.53

Intrinsic Value

Enterprise Value 387.32
Net Debt 567.87
Equity Value -180.55
Shares Outstanding 37.72
Equity Value Per Share -4.79