Discounted Cash Flow (DCF) Analysis Unlevered

The Timken Company (TKR)

$70.48

-0.88 (-1.23%)
All numbers are in Millions, Currency in USD
Stock DCF: 62.94 | 70.48 | 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 3,003.803,580.803,789.903,5134,132.904,498.544,896.535,329.725,801.246,314.48
Revenue (%)
EBITDA 435.80603.10692.50629.70690.80758.12825.19898.19977.661,064.15
EBITDA (%)
EBIT 298.10457.10531.90462.60523562.74612.52666.71725.70789.90
EBIT (%)
Depreciation 137.70146160.60167.10167.80195.38212.66231.48251.96274.25
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 121.60132.50209.50320257.10257.37280.14304.93331.90361.27
Total Cash (%)
Account Receivables 524.90663.20674.30581730.90791.84861.90938.151,021.151,111.49
Account Receivables (%)
Inventories 738.90835.708428411,042.701,073.561,168.541,271.921,384.441,506.93
Inventories (%)
Accounts Payable 265.20273.20301.70351430403.20438.87477.70519.96565.96
Accounts Payable (%)
Capital Expenditure -104.70-112.60-140.60-121.60-148.30-156.46-170.30-185.36-201.76-219.61
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 70.48
Beta 1.569
Diluted Shares Outstanding 76.40
Cost of Debt
Tax Rate 22.56
After-tax Cost of Debt 2.90%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.920
Total Debt 1,568.70
Total Equity 5,384.77
Total Capital 6,953.47
Debt Weighting 22.56
Equity Weighting 77.44
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 3,003.803,580.803,789.903,5134,132.904,498.544,896.535,329.725,801.246,314.48
EBITDA 435.80603.10692.50629.70690.80758.12825.19898.19977.661,064.15
EBIT 298.10457.10531.90462.60523562.74612.52666.71725.70789.90
Tax Rate 21.74%25.80%23.35%26.26%22.56%23.94%23.94%23.94%23.94%23.94%
EBIAT 233.30339.16407.71341.11405.03428.01465.88507.09551.95600.79
Depreciation 137.70146160.60167.10167.80195.38212.66231.48251.96274.25
Accounts Receivable --138.30-11.1093.30-149.90-60.94-70.05-76.25-83-90.34
Inventories --96.80-6.301-201.70-30.86-94.98-103.38-112.53-122.48
Accounts Payable -828.5049.3079-26.8035.6738.8342.2646
Capital Expenditure -104.70-112.60-140.60-121.60-148.30-156.46-170.30-185.36-201.76-219.61
UFCF 266.30145.46438.81530.21151.93348.33378.88412.40448.88488.60
WACC
PV UFCF 319.25318.25317.49316.72315.96
SUM PV UFCF 1,587.67

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 9.11
Free cash flow (t + 1) 498.37
Terminal Value 7,009.42
Present Value of Terminal Value 4,532.72

Intrinsic Value

Enterprise Value 6,120.39
Net Debt 1,311.60
Equity Value 4,808.79
Shares Outstanding 76.40
Equity Value Per Share 62.94