Discounted Cash Flow (DCF) Analysis Unlevered

Targa Resources Corp. (TRGP)

$59.75

-5.70 (-8.71%)
All numbers are in Millions, Currency in USD
Stock DCF: -280.48 | 59.75 | 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 8,814.9010,4848,671.108,26016,949.8021,276.4626,707.5633,525.0142,082.7252,824.88
Revenue (%)
EBITDA 700.101,008.801,012.30-1,076.991,344.501,026.911,289.041,618.092,031.132,549.60
EBITDA (%)
EBIT -109.40192.9040.70-1,077473.90-390.41-490.06-615.16-772.18-969.29
EBIT (%)
Depreciation 809.50815.90971.600.01870.601,417.321,779.112,233.252,803.313,518.89
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 137.20232.10331.10956158.50855.221,073.521,347.551,691.532,123.32
Total Cash (%)
Account Receivables 827.60865.508558621,331.901,948.852,446.313,070.773,854.624,838.57
Account Receivables (%)
Inventories 204.50164.70161.50181153.40376.58472.71593.37744.84934.97
Inventories (%)
Accounts Payable 1,001.201,200.50997.108331,402.302,241.092,813.163,531.254,432.655,564.14
Accounts Payable (%)
Capital Expenditure -1,297.50-3,114.80-2,877.80-0.95-505.10-3,430.16-4,305.76-5,404.86-6,784.52-8,516.36
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 59.75
Beta 2.410
Diluted Shares Outstanding 232.20
Cost of Debt
Tax Rate 83.70
After-tax Cost of Debt 0.95%
Risk-Free Rate
Market Risk Premium
Cost of Equity 15.074
Total Debt 6,631.70
Total Equity 13,873.95
Total Capital 20,505.65
Debt Weighting 32.34
Equity Weighting 67.66
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 8,814.9010,4848,671.108,26016,949.8021,276.4626,707.5633,525.0142,082.7252,824.88
EBITDA 700.101,008.801,012.30-1,076.991,344.501,026.911,289.041,618.092,031.132,549.60
EBIT -109.40192.9040.70-1,077473.90-390.41-490.06-615.16-772.18-969.29
Tax Rate 118.44%97.57%-347.97%15.77%83.70%-6.50%-6.50%-6.50%-6.50%-6.50%
EBIAT 20.174.68182.32-907.2077.23-415.77-521.90-655.13-822.36-1,032.27
Depreciation 809.50815.90971.600.01870.601,417.321,779.112,233.252,803.313,518.89
Accounts Receivable --37.9010.50-7-469.90-616.95-497.47-624.45-783.85-983.94
Inventories -39.803.20-19.5027.60-223.18-96.13-120.67-151.47-190.13
Accounts Payable -199.30-203.40-164.10569.30838.79572.07718.10901.401,131.49
Capital Expenditure -1,297.50-3,114.80-2,877.80-0.95-505.10-3,430.16-4,305.76-5,404.86-6,784.52-8,516.36
UFCF -467.83-2,093.02-1,913.58-1,098.74569.73-2,429.96-3,070.08-3,853.76-4,837.49-6,072.32
WACC
PV UFCF -2,198.86-2,513.89-2,855.49-3,243.50-3,684.23
SUM PV UFCF -14,495.96

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 10.51
Free cash flow (t + 1) -6,193.76
Terminal Value -72,782.18
Present Value of Terminal Value -44,158.79

Intrinsic Value

Enterprise Value -58,654.75
Net Debt 6,473.20
Equity Value -65,127.95
Shares Outstanding 232.20
Equity Value Per Share -280.48