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Discounted Cash Flow (DCF) Analysis Unlevered


Transdigm Group Incorporated Inc.

Transdigm Group Incorporated Inc. (TDG)

Industrials

Operating Data

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 1,924.402,372.982,707.093,171.363,504.353,811.334,373.895,019.475,760.356,610.577,586.29
Revenue (%)
EBITDA 621.39766.001,145.911,370.661,390.181,717.771,711.941,964.622,254.602,587.382,969.28
EBITDA (%)
EBIT 547.88669.651,052.251,248.881,249.301,587.801,547.041,775.392,037.432,338.162,683.27
EBIT (%)
Depreciation 73.5196.3493.67121.78140.87129.97164.90189.23217.17249.22286.00
Depreciation (%)

Balance Sheet Data

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Total Cash 564.81819.63714.131,586.95650.412,072.981,554.481,783.922,047.232,349.402,696.17
Total Cash (%)
Account Receivables 290.39351.20443.96576.24636.04704.33737.00845.78970.621,113.881,278.29
Account Receivables (%)
Inventories 413.55459.17591.50724.02730.66805.33929.451,066.641,224.071,404.751,612.09
Inventories (%)
Accounts Payable 106.80115.80142.93156.03148.93173.42214.32245.95282.26323.92371.73
Accounts Payable (%)
Capital Expenditure -35.60-34.17-54.95-44.08-71.14-73.18-77.42-88.84-101.96-117.01-134.28
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 527.17
Diluted Shares Outstanding 55.60
Cost of Debt
Tax Rate 2.60
After-tax Cost of Debt -0.08
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.43
Total Debt 12,501.95
Total Equity 29,309.07
Total Capital 41,811.02
Debt Weighting 29.90
Equity Weighting 70.10
Wacc

Build Up Free Cash

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 1,924.402,372.982,707.093,171.363,504.353,811.334,373.895,019.475,760.356,610.577,586.29
EBITDA 621.39766.001,145.911,370.661,390.181,717.771,711.941,964.622,254.602,587.382,969.28
EBIT 547.88669.651,052.251,248.881,249.301,587.801,547.041,775.392,037.432,338.162,683.27
Tax Rate 52.55%43.99%29.93%23.75%32.31%2.60%30.86%30.86%30.86%30.86%30.86%
EBIAT 259.95375.07737.28952.29845.651,546.571,069.701,227.591,408.781,616.711,855.34
Depreciation 73.5196.3493.67121.78140.87129.97164.90189.23217.17249.22286.00
Accounts Receivable --60.81-92.76-132.27-59.80-68.29-32.67-108.78-124.84-143.26-164.41
Inventories --45.62-132.33-132.52-6.64-74.68-124.12-137.19-157.44-180.67-207.34
Accounts Payable -9.0027.1313.10-7.1024.4840.9031.6336.3041.6647.81
Capital Expenditure --1.4320.78-10.8727.062.044.2411.4313.1115.0517.27
UFCF 333.47372.55653.77811.50940.051,560.081,122.961,213.911,393.091,598.711,834.68
WACC
PV UFCF 1,032.421,026.051,082.561,142.171,205.07
SUM PV UFCF 6,583.04

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.77
Free cash flow (t + 1) 1,908.06
Terminal Value 40,001.32
Present Value of Terminal Value 26,274.15

Intrinsic Value

Enterprise Value 32,857.19
Net Debt 10,428.96
Equity Value 22,428.23
Shares Outstanding 55.60
Equity Value Per Share 403.41