Discounted Cash Flow (DCF) Analysis Unlevered

Realty Income Corporation (O)

$61.27

-0.70 (-1.13%)

All numbers are in Millions, Currency in USD

Stock DCF: 333.57 | 61.27 | undervalue

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	1,327.84	1,491.59	1,651.63	2,080.46	3,343.68	4,261.05	5,430.12	6,919.93	8,818.48	11,237.92
Revenue (%)
EBITDA	1,166	1,311.55	1,377.92	1,608.04	3,030.43	3,639.74	4,638.34	5,910.91	7,532.63	9,599.28
EBITDA (%)
EBIT	626.22	717.59	700.88	710.20	1,360.04	1,811.10	2,307.99	2,941.21	3,748.16	4,776.51
EBIT (%)
Depreciation	539.78	593.96	677.04	897.84	1,670.39	1,828.64	2,330.35	2,969.70	3,784.47	4,822.78
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	10.39	54.01	824.48	258.58	171.10	612.47	780.51	994.65	1,267.54	1,615.30
Total Cash (%)
Account Receivables	144.99	273.54	418.12	755.14	1,501.08	1,157	1,474.43	1,878.95	2,394.47	3,051.41
Account Receivables (%)
Inventories	-	-	-	-	29.54	37.64	47.96	61.12	77.89	99.27
Inventories (%)
Accounts Payable	133.77	177.04	241.34	351.13	399.14	557.09	709.93	904.70	1,152.92	1,469.23
Accounts Payable (%)
Capital Expenditure	-	-	-	-	-	-	-	-	-	-
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 61.27
Beta	0.795
Diluted Shares Outstanding	612.18
Cost of Debt
Tax Rate	5.25
After-tax Cost of Debt	2.11%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.359
Total Debt	19,979.73
Total Equity	37,508.30
Total Capital	57,488.03
Debt Weighting	34.75
Equity Weighting	65.25
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	1,327.84	1,491.59	1,651.63	2,080.46	3,343.68	4,261.05	5,430.12	6,919.93	8,818.48	11,237.92
EBITDA	1,166	1,311.55	1,377.92	1,608.04	3,030.43	3,639.74	4,638.34	5,910.91	7,532.63	9,599.28
EBIT	626.22	717.59	700.88	710.20	1,360.04	1,811.10	2,307.99	2,941.21	3,748.16	4,776.51
Tax Rate	1.71%	1.61%	3.82%	8.40%	5.25%	4.16%	4.16%	4.16%	4.16%	4.16%
EBIAT	615.52	706.02	674.09	650.57	1,288.61	1,735.79	2,212.02	2,818.90	3,592.30	4,577.88
Depreciation	539.78	593.96	677.04	897.84	1,670.39	1,828.64	2,330.35	2,969.70	3,784.47	4,822.78
Accounts Receivable	-	-128.55	-144.58	-337.02	-745.93	344.08	-317.43	-404.52	-515.51	-656.95
Inventories	-	-	-	-	-	-8.10	-10.33	-13.16	-16.77	-21.37
Accounts Payable	-	43.27	64.30	109.79	48.01	157.95	152.84	194.78	248.21	316.32
Capital Expenditure	-	-	-	-	-	-	-	-	-	-
UFCF	-	-	-	-	-	4,058.35	4,367.44	5,565.70	7,092.70	9,038.66
WACC
PV UFCF						3,845.32	3,920.97	4,734.44	5,716.67	6,902.69
SUM PV UFCF										25,120.10

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.54
Free cash flow (t + 1)	9,219.43
Terminal Value	260,435.97
Present Value of Terminal Value	198,891.17

Intrinsic Value

Enterprise Value	224,011.27
Net Debt	19,808.63
Equity Value	204,202.64
Shares Outstanding	612.18
Equity Value Per Share	333.57