Discounted Cash Flow (DCF) Analysis Unlevered

Thomson Reuters Corporation (TRI)

$114.4

+0.35 (+0.31%)

All numbers are in Millions, Currency in USD

Stock DCF: 1,430.57 | 114.4 | 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	5,297	5,501	5,906	5,984	6,348	6,643.45	6,952.66	7,276.25	7,614.91	7,969.33
Revenue (%)
EBITDA	3,291	4,921	2,443	2,186	8,262	4,778.41	5,000.81	5,233.56	5,477.14	5,732.06
EBITDA (%)
EBIT	1,828	4,302	1,726	1,394	7,492	3,763.59	3,938.76	4,122.08	4,313.93	4,514.71
EBIT (%)
Depreciation	1,463	619	717	792	770	1,014.82	1,062.05	1,111.48	1,163.21	1,217.35
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	972	2,782	1,358	2,399	886	1,939.40	2,029.67	2,124.14	2,223	2,326.46
Total Cash (%)
Account Receivables	1,510	1,382	1,239	1,216	1,057	1,482.55	1,551.55	1,623.77	1,699.34	1,778.43
Account Receivables (%)
Inventories	31	33	23	26	31.88	33.37	34.92	36.55	38.25	40.03
Inventories (%)
Accounts Payable	307	326	265	217	1,363	548.84	574.38	601.11	629.09	658.37
Accounts Payable (%)
Capital Expenditure	-950	-576	-505	-504	-487	-704.87	-737.68	-772.01	-807.95	-845.55
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 114.4
Beta	0.268
Diluted Shares Outstanding	498.03
Cost of Debt
Tax Rate	-439.75
After-tax Cost of Debt	5.18%
Risk-Free Rate
Market Risk Premium
Cost of Equity	4.032
Total Debt	3,786
Total Equity	56,974.86
Total Capital	60,760.86
Debt Weighting	6.23
Equity Weighting	93.77
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	5,297	5,501	5,906	5,984	6,348	6,643.45	6,952.66	7,276.25	7,614.91	7,969.33
EBITDA	3,291	4,921	2,443	2,186	8,262	4,778.41	5,000.81	5,233.56	5,477.14	5,732.06
EBIT	1,828	4,302	1,726	1,394	7,492	3,763.59	3,938.76	4,122.08	4,313.93	4,514.71
Tax Rate	-175.15%	-637.90%	-61.07%	36.39%	-439.75%	-255.50%	-255.50%	-255.50%	-255.50%	-255.50%
EBIAT	5,029.70	31,744.40	2,780.09	886.66	40,438.32	13,379.38	14,002.10	14,653.79	15,335.82	16,049.59
Depreciation	1,463	619	717	792	770	1,014.82	1,062.05	1,111.48	1,163.21	1,217.35
Accounts Receivable	-	128	143	23	159	-425.55	-69	-72.21	-75.57	-79.09
Inventories	-	-2	10	-3	-5.88	-1.48	-1.55	-1.63	-1.70	-1.78
Accounts Payable	-	19	-61	-48	1,146	-814.16	25.54	26.73	27.98	29.28
Capital Expenditure	-950	-576	-505	-504	-487	-704.87	-737.68	-772.01	-807.95	-845.55
UFCF	5,542.70	31,932.40	3,084.09	1,146.66	42,020.43	12,448.13	14,281.45	14,946.15	15,641.79	16,369.80
WACC
PV UFCF						11,957.85	13,178.65	13,248.82	13,319.36	13,390.28
SUM PV UFCF										65,094.97

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	4.10
Free cash flow (t + 1)	16,697.19
Terminal Value	795,104.51
Present Value of Terminal Value	650,385.08

Intrinsic Value

Enterprise Value	715,480.05
Net Debt	3,008
Equity Value	712,472.05
Shares Outstanding	498.03
Equity Value Per Share	1,430.57