eBay Inc. (EBAY)
Discount cash flow analysis
5% margin of safety What's this?
Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $22.53 | $22.25 | $21.98 | |
| Terminal Growth% | 0 | $22.62 | $22.34 | $22.06 |
| +1% | $22.71 | $22.42 | $22.15 |
How does a change in discount rate or terminal growth affect valuation?
This table shows the sensitivity of the valuation to two key variables - the discount rate and the terminal growth rate
Valuations and comments
- Valuecruncher created a new valuation of $5.30 (overvalued by 79.59%) - 6 hours ago
- Valuecruncher created a new valuation of $5.30 (overvalued by 79.59%) - 18 hours ago
- valuereq created a new valuation of $30.46 (undervalued by 31.75%) - 3 months ago
- valuereq created a new valuation of $30.02 (undervalued by 27.2%) - 3 months ago
- valuereq created a new valuation of $32.01 (undervalued by 35.64%) - 3 months ago
- SethWellbourne created a new valuation of $15.84 (undervalued by 10.85%) - 10 months ago
- SethWellbourne created a new valuation of $15.97 (undervalued by 27.96%) - 11 months ago
- GordonGekko created a new valuation of $13.68 (undervalued by 17.63%) - 1 year ago
- TheCrunchBlog created a new valuation of $23.88 (undervalued by 6.7%) - 1 year ago
- GordonGekko created a new valuation of $22.34 (undervalued by 11.98%) - 1 year ago
- TheCrunchBlog created a new valuation of $28.13 (overvalued by 0.88%) - 1 year ago
- GordonGekko created a new valuation of $28.82 (undervalued by 1.55%) - 1 year ago
- BudFox1987 created a new valuation of $49.15 (undervalued by 57.03%) - 1 year ago
- JStew82 created a new valuation of $21.15 (overvalued by 32.43%) - 1 year ago
- GordonGekko created a new valuation of $27.65 (overvalued by 11.66%) - 1 year ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 29,078 |
| Net Debt (Long-term borrowings less cash): | -4,697 |
| Equity Value: | 25,946 |
| Number of Shares Outstanding: | 1,300,000,000 |
| Calculated value per share: | $22.34 |
Enterprise Value is the present value of the post-tax cash flows for a business into the future.
Where:
- C1, C2, C3 - the cash flow in period 1, 2, 3, ...
- r - the discount rate
To capture the cash flows into the future a terminal value is calculated via a perpetuity calculation -
based on the final years forecast post-tax free cash flow.
Where:
- Cn - the cash flow in the final forecast period.
- LTG - the long-term growth rate
- r - the discount rate
- g - the terminal growth rate
The Capital Asset Pricing Model (CAPM) is used to determine the equity component in the discount rate.
Where:
- rt - the risk free rate
- t - the tax rate
- B - the beta of the company
- MRP - the Market Risk Premium
Valuecruncher uses an estimate of Weighted Average Cost of Capital (WACC) to determine the discount rate in the calculation.