Discounted Cash Flow (DCF) Analysis Unlevered

Thomson Reuters Corporation (TRI.TO)

$146.77

-0.33 (-0.22%)

All numbers are in Millions, Currency in USD

Stock DCF: 571.70 | 146.77 | 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	11,333	5,501	5,906	5,984	6,348	5,765.66	5,236.74	4,756.34	4,320.01	3,923.71
Revenue (%)
EBITDA	2,954	5,007	1,290	2,186	8,262	3,524.08	3,200.79	2,907.17	2,640.47	2,398.25
EBITDA (%)
EBIT	1,491	4,388	573	1,394	7,492	2,812.98	2,554.93	2,320.55	2,107.67	1,914.32
EBIT (%)
Depreciation	1,463	619	717	792	770	711.10	645.87	586.62	532.80	483.93
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	1,570.45	1,426.39	1,295.54	1,176.69	1,068.74
Total Cash (%)
Account Receivables	1,457	1,313	1,239	1,216	1,057	1,091.73	991.58	900.61	818	742.96
Account Receivables (%)
Inventories	31	33	23	26	26.94	24.47	22.22	20.18	18.33	16.65
Inventories (%)
Accounts Payable	307	326	265	217	1,363	440.72	400.29	363.57	330.22	299.93
Accounts Payable (%)
Capital Expenditure	-950	-576	-505	-504	-487	-501.59	-455.58	-413.78	-375.83	-341.35
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 146.77
Beta	0.268
Diluted Shares Outstanding	494.50
Cost of Debt
Tax Rate	-439.75
After-tax Cost of Debt	5.18%
Risk-Free Rate
Market Risk Premium
Cost of Equity	4.064
Total Debt	3,786
Total Equity	72,578.43
Total Capital	76,364.43
Debt Weighting	4.96
Equity Weighting	95.04
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	11,333	5,501	5,906	5,984	6,348	5,765.66	5,236.74	4,756.34	4,320.01	3,923.71
EBITDA	2,954	5,007	1,290	2,186	8,262	3,524.08	3,200.79	2,907.17	2,640.47	2,398.25
EBIT	1,491	4,388	573	1,394	7,492	2,812.98	2,554.93	2,320.55	2,107.67	1,914.32
Tax Rate	-17.23%	-640.90%	-61.07%	36.39%	-439.75%	-224.51%	-224.51%	-224.51%	-224.51%	-224.51%
EBIAT	1,747.85	32,510.72	922.94	886.66	40,438.32	9,128.44	8,291.03	7,530.44	6,839.63	6,212.19
Depreciation	1,463	619	717	792	770	711.10	645.87	586.62	532.80	483.93
Accounts Receivable	-	144	74	23	159	-34.73	100.15	90.96	82.62	75.04
Inventories	-	-2	10	-3	-0.94	2.47	2.24	2.04	1.85	1.68
Accounts Payable	-	19	-61	-48	1,146	-922.28	-40.43	-36.72	-33.35	-30.29
Capital Expenditure	-950	-576	-505	-504	-487	-501.59	-455.58	-413.78	-375.83	-341.35
UFCF	2,260.85	32,714.72	1,157.94	1,146.66	42,025.38	8,383.41	8,543.28	7,759.56	7,047.72	6,401.19
WACC
PV UFCF						8,051.68	7,880.55	6,874.39	5,996.70	5,231.07
SUM PV UFCF										34,034.39

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	4.12
Free cash flow (t + 1)	6,529.22
Terminal Value	307,981.93
Present Value of Terminal Value	251,683.32

Intrinsic Value

Enterprise Value	285,717.71
Net Debt	3,008
Equity Value	282,709.71
Shares Outstanding	494.50
Equity Value Per Share	571.70