Discounted Cash Flow (DCF) Analysis Unlevered

Sorrento Therapeutics, Inc. (SRNE)

$0.3073

0.00 (0.00%)

All numbers are in Millions, Currency in USD

Stock DCF: -94.43 | 0.3073 | 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	21.19	31.43	39.99	52.90	62.84	82.73	108.92	143.39	188.78	248.53
Revenue (%)
EBITDA	-143.13	-183.10	-191.87	-383.45	-364.52	-503.43	-662.79	-872.58	-1,148.78	-1,512.41
EBITDA (%)
EBIT	-152.18	-194.09	-202.88	-395.92	-377.77	-528.23	-695.43	-915.55	-1,205.35	-1,586.89
EBIT (%)
Depreciation	9.05	10.99	11.01	12.46	13.25	24.79	32.64	42.97	56.57	74.48
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	159.03	22.52	56.46	126.88	49.98	212.22	279.40	367.84	484.27	637.56
Total Cash (%)
Account Receivables	4.36	14.51	15.51	18.71	24.47	29.76	39.17	51.57	67.90	89.39
Account Receivables (%)
Inventories	-	3.36	1.83	8.11	9.98	9.61	12.65	16.66	21.93	28.88
Inventories (%)
Accounts Payable	13.82	27.63	24.71	27.41	47.52	56.64	74.57	98.17	129.25	170.16
Accounts Payable (%)
Capital Expenditure	-11.20	-11.44	-37.58	-8.87	-13.66	-36.68	-48.30	-63.58	-83.71	-110.20
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 0.3,073
Beta	0.000
Diluted Shares Outstanding	419.31
Cost of Debt
Tax Rate	0.43
After-tax Cost of Debt	6.34%
Risk-Free Rate
Market Risk Premium
Cost of Equity	4.542
Total Debt	134.50
Total Equity	128.86
Total Capital	263.36
Debt Weighting	51.07
Equity Weighting	48.93
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	21.19	31.43	39.99	52.90	62.84	82.73	108.92	143.39	188.78	248.53
EBITDA	-143.13	-183.10	-191.87	-383.45	-364.52	-503.43	-662.79	-872.58	-1,148.78	-1,512.41
EBIT	-152.18	-194.09	-202.88	-395.92	-377.77	-528.23	-695.43	-915.55	-1,205.35	-1,586.89
Tax Rate	4.79%	0.13%	0.65%	7.25%	0.43%	2.65%	2.65%	2.65%	2.65%	2.65%
EBIAT	-144.89	-193.84	-201.56	-367.23	-376.14	-514.23	-677	-891.30	-1,173.42	-1,544.85
Depreciation	9.05	10.99	11.01	12.46	13.25	24.79	32.64	42.97	56.57	74.48
Accounts Receivable	-	-10.15	-0.99	-3.21	-5.75	-5.29	-9.42	-12.40	-16.32	-21.49
Inventories	-	-	1.53	-6.27	-1.87	0.36	-3.04	-4.01	-5.27	-6.94
Accounts Payable	-	13.81	-2.92	2.71	20.10	9.12	17.93	23.60	31.07	40.91
Capital Expenditure	-11.20	-11.44	-37.58	-8.87	-13.66	-36.68	-48.30	-63.58	-83.71	-110.20
UFCF	-147.03	-190.63	-230.52	-370.41	-364.08	-521.92	-687.19	-904.71	-1,191.08	-1,568.09
WACC
PV UFCF						-494.90	-617.88	-771.34	-962.92	-1,202.08
SUM PV UFCF										-4,049.11

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.46
Free cash flow (t + 1)	-1,599.45
Terminal Value	-46,226.97
Present Value of Terminal Value	-35,436.97

Intrinsic Value

Enterprise Value	-39,486.08
Net Debt	110.87
Equity Value	-39,596.95
Shares Outstanding	419.31
Equity Value Per Share	-94.43