Discounted Cash Flow (DCF) Analysis Unlevered

Patterson Companies, Inc. (PDCO)

$26.5

+0.30 (+1.15%)

All numbers are in Millions, Currency in USD

Stock DCF: 7.08 | 26.5 | 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	5,465.68	5,574.52	5,490.01	5,912.07	6,499.41	6,793.46	7,100.83	7,422.10	7,757.90	8,108.90
Revenue (%)
EBITDA	309.82	229.42	-465.52	303.98	370.03	164.94	172.40	180.20	188.36	196.88
EBITDA (%)
EBIT	226.01	146.65	-547.70	225.09	288.04	68.32	71.41	74.64	78.02	81.55
EBIT (%)
Depreciation	83.82	82.77	82.18	78.90	81.99	96.62	100.99	105.56	110.34	115.33
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	62.98	95.65	77.94	143.24	142.01	120.87	126.34	132.05	138.03	144.27
Total Cash (%)
Account Receivables	826.88	582.09	416.52	449.24	447.16	647.23	676.51	707.12	739.11	772.55
Account Receivables (%)
Inventories	779.83	761.02	812.19	736.78	785.60	913.90	955.25	998.47	1,043.64	1,090.86
Inventories (%)
Accounts Payable	610.37	648.42	862.09	609.26	681.32	805.57	842.02	880.12	919.94	961.56
Accounts Payable (%)
Capital Expenditure	-43.26	-60.73	-41.81	-25.79	-38.31	-49.84	-52.09	-54.45	-56.91	-59.49
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 26.5
Beta	1.211
Diluted Shares Outstanding	98.51
Cost of Debt
Tax Rate	23.68
After-tax Cost of Debt	2.63%
Risk-Free Rate
Market Risk Premium
Cost of Equity	9.526
Total Debt	590.23
Total Equity	2,610.62
Total Capital	3,200.86
Debt Weighting	18.44
Equity Weighting	81.56
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	5,465.68	5,574.52	5,490.01	5,912.07	6,499.41	6,793.46	7,100.83	7,422.10	7,757.90	8,108.90
EBITDA	309.82	229.42	-465.52	303.98	370.03	164.94	172.40	180.20	188.36	196.88
EBIT	226.01	146.65	-547.70	225.09	288.04	68.32	71.41	74.64	78.02	81.55
Tax Rate	-12.11%	21.27%	0.33%	21.98%	23.68%	11.03%	11.03%	11.03%	11.03%	11.03%
EBIAT	253.38	115.45	-545.88	175.61	219.84	60.78	63.53	66.41	69.41	72.55
Depreciation	83.82	82.77	82.18	78.90	81.99	96.62	100.99	105.56	110.34	115.33
Accounts Receivable	-	244.78	165.57	-32.71	2.07	-200.07	-29.28	-30.61	-31.99	-33.44
Inventories	-	18.82	-51.18	75.42	-48.83	-128.30	-41.35	-43.22	-45.17	-47.22
Accounts Payable	-	38.05	213.68	-252.83	72.06	124.25	36.45	38.10	39.82	41.62
Capital Expenditure	-43.26	-60.73	-41.81	-25.79	-38.31	-49.84	-52.09	-54.45	-56.91	-59.49
UFCF	293.93	439.14	-177.44	18.59	288.82	-96.55	78.25	81.79	85.49	89.36
WACC
PV UFCF						-89.19	66.77	64.48	62.26	60.11
SUM PV UFCF										164.44

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	8.25
Free cash flow (t + 1)	91.14
Terminal Value	1,458.28
Present Value of Terminal Value	981.08

Intrinsic Value

Enterprise Value	1,145.51
Net Debt	448.22
Equity Value	697.29
Shares Outstanding	98.51
Equity Value Per Share	7.08