Discounted Cash Flow (DCF) Analysis Unlevered

The Charles Schwab Corporation (SCHW)

$63.92

+0.74 (+1.17%)

All numbers are in Millions, Currency in USD

Stock DCF: 444.86 | 63.92 | 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	8,618	10,132	10,721	11,691	18,520	22,725.95	27,887.09	34,220.33	41,991.88	51,528.36
Revenue (%)
EBITDA	4,261	5,725	6,261	5,322	9,353	11,834.35	14,521.97	17,819.96	21,866.93	26,832.98
EBITDA (%)
EBIT	3,992	5,419	5,912	4,718	8,189	10,886.76	13,359.18	16,393.09	20,116.01	24,684.42
EBIT (%)
Depreciation	269	306	349	604	1,164	947.59	1,162.79	1,426.87	1,750.92	2,148.55
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	64,212	94,516	90,767	377,748	116,924	290,301.57	356,229.98	437,130.93	536,404.74	658,223.96
Total Cash (%)
Account Receivables	22,099	23,200	23,146	67,947	90,565	80,518.16	98,804.08	121,242.80	148,777.43	182,565.25
Account Receivables (%)
Inventories	-	-	-	-	-	-	-	-	-	-
Inventories (%)
Accounts Payable	32,530	34,557	39,220	104,201	91,472.60	112,246.32	137,737.82	169,018.51	207,403.15	254,505.06
Accounts Payable (%)
Capital Expenditure	-400	-570	-708	-631	-916	-1,236.94	-1,517.86	-1,862.57	-2,285.56	-2,804.62
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 63.92
Beta	1.089
Diluted Shares Outstanding	1,429
Cost of Debt
Tax Rate	24.09
After-tax Cost of Debt	1.52%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.031
Total Debt	23,769
Total Equity	91,341.68
Total Capital	115,110.68
Debt Weighting	20.65
Equity Weighting	79.35
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	8,618	10,132	10,721	11,691	18,520	22,725.95	27,887.09	34,220.33	41,991.88	51,528.36
EBITDA	4,261	5,725	6,261	5,322	9,353	11,834.35	14,521.97	17,819.96	21,866.93	26,832.98
EBIT	3,992	5,419	5,912	4,718	8,189	10,886.76	13,359.18	16,393.09	20,116.01	24,684.42
Tax Rate	35.51%	23.13%	23.60%	23.28%	24.09%	25.92%	25.92%	25.92%	25.92%	25.92%
EBIAT	2,574.57	4,165.81	4,516.92	3,619.69	6,216.34	8,064.95	9,896.52	12,144.06	14,902.01	18,286.30
Depreciation	269	306	349	604	1,164	947.59	1,162.79	1,426.87	1,750.92	2,148.55
Accounts Receivable	-	-1,101	54	-44,801	-22,618	10,046.84	-18,285.93	-22,438.72	-27,534.62	-33,787.82
Inventories	-	-	-	-	-	-	-	-	-	-
Accounts Payable	-	2,027	4,663	64,981	-12,728.40	20,773.72	25,491.49	31,280.69	38,384.64	47,101.91
Capital Expenditure	-400	-570	-708	-631	-916	-1,236.94	-1,517.86	-1,862.57	-2,285.56	-2,804.62
UFCF	2,443.57	4,827.81	8,874.92	23,772.69	-28,882.06	38,596.16	16,747.03	20,550.33	25,217.37	30,944.32
WACC
PV UFCF						36,175.99	14,712.63	16,921.84	19,462.79	22,385.27
SUM PV UFCF										109,658.52

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	6.69
Free cash flow (t + 1)	31,563.21
Terminal Value	672,989.48
Present Value of Terminal Value	486,843.86

Intrinsic Value

Enterprise Value	596,502.38
Net Debt	-39,206
Equity Value	635,708.38
Shares Outstanding	1,429
Equity Value Per Share	444.86