Discounted Cash Flow (DCF) Analysis Unlevered

Polaris Inc. (PII)

$116.56

+2.56 (+2.25%)
All numbers are in Millions, Currency in USD
Stock DCF: 81.50 | 116.56 | 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 5,428.486,078.546,782.527,027.908,198.209,096.4510,093.1111,198.9712,42613,787.47
Revenue (%)
EBITDA 542.05697.25719.98468.70906.60905.991,005.251,115.391,237.601,373.20
EBITDA (%)
EBIT 350.95486.22485.46208669.50595.77661.05733.48813.84903.01
EBIT (%)
Depreciation 191.11211.04234.51260.70237.10310.22344.21381.92423.76470.19
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 138.35161.16157.06634.70509.20414.03459.39509.73565.58627.55
Total Cash (%)
Account Receivables 229.74233.56222.88261.10244.50328.53364.53404.46448.78497.95
Account Receivables (%)
Inventories 783.96969.511,121.111,177.601,644.801,523.471,690.391,875.602,081.102,309.12
Inventories (%)
Accounts Payable 317.38346.29450.23782.20797.40710.21788.03874.37970.171,076.47
Accounts Payable (%)
Capital Expenditure -184.39-225.41-251.37-213.90-298.30-318.26-353.13-391.82-434.75-482.38
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 116.56
Beta 1.522
Diluted Shares Outstanding 62.70
Cost of Debt
Tax Rate 21.06
After-tax Cost of Debt 1.78%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.690
Total Debt 1,968.50
Total Equity 7,308.31
Total Capital 9,276.81
Debt Weighting 21.22
Equity Weighting 78.78
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 5,428.486,078.546,782.527,027.908,198.209,096.4510,093.1111,198.9712,42613,787.47
EBITDA 542.05697.25719.98468.70906.60905.991,005.251,115.391,237.601,373.20
EBIT 350.95486.22485.46208669.50595.77661.05733.48813.84903.01
Tax Rate 45.89%21.90%20.56%11.74%21.06%24.23%24.23%24.23%24.23%24.23%
EBIAT 189.89379.75385.66183.58528.47451.41500.87555.75616.64684.21
Depreciation 191.11211.04234.51260.70237.10310.22344.21381.92423.76470.19
Accounts Receivable --3.8110.68-38.2216.60-84.03-36-39.94-44.32-49.17
Inventories --185.55-151.60-56.49-467.20121.33-166.92-185.21-205.50-228.02
Accounts Payable -28.92103.93331.9715.20-87.1977.8286.3495.80106.30
Capital Expenditure -184.39-225.41-251.37-213.90-298.30-318.26-353.13-391.82-434.75-482.38
UFCF 196.61204.93331.81467.6431.87393.49366.85407.05451.64501.13
WACC
PV UFCF 361.66309.91316.05322.32328.70
SUM PV UFCF 1,638.64

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.80
Free cash flow (t + 1) 511.15
Terminal Value 7,516.93
Present Value of Terminal Value 4,930.56

Intrinsic Value

Enterprise Value 6,569.20
Net Debt 1,459.30
Equity Value 5,109.90
Shares Outstanding 62.70
Equity Value Per Share 81.50