Discounted Cash Flow (DCF) Analysis Unlevered

Walgreens Boots Alliance, Inc. (WBA)

$20.91

-0.11 (-0.52%)

All numbers are in Millions, Currency in USD

Stock DCF: 251.14 | 20.91 | undervalue

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	131,537	136,866	139,537	132,509	132,703	133,072.12	133,442.27	133,813.45	134,185.66	134,558.90
Revenue (%)
EBITDA	8,361	7,269	3,309	5,454	6,375	6,110.34	6,127.33	6,144.38	6,161.47	6,178.61
EBITDA (%)
EBIT	6,591	5,231	1,382	3,481	4,385	4,192.98	4,204.64	4,216.33	4,228.06	4,239.82
EBIT (%)
Depreciation	1,770	2,038	1,927	1,973	1,990	1,917.36	1,922.69	1,928.04	1,933.40	1,938.78
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	785	1,023	516	1,193	2,472	1,191.57	1,194.88	1,198.21	1,201.54	1,204.88
Total Cash (%)
Account Receivables	6,573	7,226	7,132	5,663	5,017	6,239	6,256.35	6,273.76	6,291.21	6,308.71
Account Receivables (%)
Inventories	9,565	9,333	9,451	8,159	8,353	8,866.79	8,891.45	8,916.19	8,940.99	8,965.86
Inventories (%)
Accounts Payable	13,566	14,341	14,458	11,136	11,255	12,785.11	12,820.68	12,856.34	12,892.10	12,927.96
Accounts Payable (%)
Capital Expenditure	-1,367	-1,702	-1,374	-1,379	-1,734	-1,494.36	-1,498.52	-1,502.68	-1,506.86	-1,511.06
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 20.91
Beta	0.694
Diluted Shares Outstanding	865.90
Cost of Debt
Tax Rate	-8.83
After-tax Cost of Debt	1.13%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.934
Total Debt	35,477
Total Equity	18,105.97
Total Capital	53,582.97
Debt Weighting	66.21
Equity Weighting	33.79
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	131,537	136,866	139,537	132,509	132,703	133,072.12	133,442.27	133,813.45	134,185.66	134,558.90
EBITDA	8,361	7,269	3,309	5,454	6,375	6,110.34	6,127.33	6,144.38	6,161.47	6,178.61
EBIT	6,591	5,231	1,382	3,481	4,385	4,192.98	4,204.64	4,216.33	4,228.06	4,239.82
Tax Rate	15.92%	12.04%	38.63%	33.43%	-8.83%	18.24%	18.24%	18.24%	18.24%	18.24%
EBIAT	5,541.96	4,601.25	848.17	2,317.18	4,772.33	3,428.32	3,437.86	3,447.42	3,457.01	3,466.62
Depreciation	1,770	2,038	1,927	1,973	1,990	1,917.36	1,922.69	1,928.04	1,933.40	1,938.78
Accounts Receivable	-	-653	94	1,469	646	-1,222	-17.35	-17.40	-17.45	-17.50
Inventories	-	232	-118	1,292	-194	-513.79	-24.66	-24.73	-24.80	-24.87
Accounts Payable	-	775	117	-3,322	119	1,530.11	35.56	35.66	35.76	35.86
Capital Expenditure	-1,367	-1,702	-1,374	-1,379	-1,734	-1,494.36	-1,498.52	-1,502.68	-1,506.86	-1,511.06
UFCF	5,944.96	5,291.25	1,494.17	2,350.18	5,599.34	3,645.64	3,855.58	3,866.30	3,877.06	3,887.84
WACC
PV UFCF						3,524.75	3,604.10	3,494.27	3,387.79	3,284.55
SUM PV UFCF										17,295.45

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	3.43
Free cash flow (t + 1)	3,965.60
Terminal Value	277,314.62
Present Value of Terminal Value	234,282.66

Intrinsic Value

Enterprise Value	251,578.11
Net Debt	34,119
Equity Value	217,459.11
Shares Outstanding	865.90
Equity Value Per Share	251.14