Discounted Cash Flow (DCF) Analysis Unlevered

Prosperity Bancshares, Inc. (PB)

$75.605

-0.59 (-0.78%)
All numbers are in Millions, Currency in USD
Stock DCF: 177.13 | 75.605 | 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 716.27727.82796.431,121.941,098.171,234.871,388.591,561.441,755.811,974.38
Revenue (%)
EBITDA 485.72518.98576.63789.61742.91863.30970.761,091.601,227.491,380.29
EBITDA (%)
EBIT 466.56500.65556.38758.21713.27830.62934.011,050.281,181.021,328.03
EBIT (%)
Depreciation 19.1618.3220.2531.4029.6532.6836.7541.3346.4752.25
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 609.49494.73861.251,994.513,062.671,772.951,993.652,241.822,520.892,834.69
Total Cash (%)
Account Receivables 56.3756.5380.8082.0766.0396.59108.61122.13137.34154.43
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 2.944.208.593.461.266.156.917.788.749.83
Accounts Payable (%)
Capital Expenditure -11.23-15.11-18.59-22.14-19.02-23.92-26.89-30.24-34.01-38.24
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 75.605
Beta 1.020
Diluted Shares Outstanding 92.68
Cost of Debt
Tax Rate 21.28
After-tax Cost of Debt 3.94%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.495
Total Debt -
Total Equity 7,007.30
Total Capital 7,007.30
Debt Weighting 0.00
Equity Weighting 100.00
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 716.27727.82796.431,121.941,098.171,234.871,388.591,561.441,755.811,974.38
EBITDA 485.72518.98576.63789.61742.91863.30970.761,091.601,227.491,380.29
EBIT 466.56500.65556.38758.21713.27830.62934.011,050.281,181.021,328.03
Tax Rate 32.98%20.15%20.67%18.00%21.28%22.62%22.62%22.62%22.62%22.62%
EBIAT 312.71399.76441.37621.70561.50642.76722.77812.75913.921,027.68
Depreciation 19.1618.3220.2531.4029.6532.6836.7541.3346.4752.25
Accounts Receivable --0.16-24.26-1.2716.04-30.56-12.02-13.52-15.20-17.10
Inventories ----------
Accounts Payable -1.264.38-5.12-2.204.890.770.860.971.09
Capital Expenditure -11.23-15.12-18.59-22.14-19.02-23.92-26.89-30.24-34.01-38.24
UFCF 320.64404.06423.15624.57585.97625.85721.37811.17912.141,025.69
WACC
PV UFCF 576.82612.77635.07658.18682.13
SUM PV UFCF 3,164.98

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.50
Free cash flow (t + 1) 1,046.20
Terminal Value 16,095.43
Present Value of Terminal Value 10,704.19

Intrinsic Value

Enterprise Value 13,869.17
Net Debt -2,547.74
Equity Value 16,416.91
Shares Outstanding 92.68
Equity Value Per Share 177.13