Yahoo! Inc. (YHOO)
Discount cash flow analysis
5% margin of safety What's this?
Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $22.38 | $21.98 | $21.60 | |
| Terminal Growth% | 0 | $22.60 | $22.19 | $21.79 |
| +1% | $22.82 | $22.39 | $21.99 |
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 $6.61 (overvalued by 59.84%) - 10 hours ago
- Diegoengel created a new valuation of $8.86 (overvalued by 41.63%) - 3 months ago
- GordonGekko created a new valuation of $14.49 (overvalued by 14.21%) - 5 months ago
- jbryanscott created a new valuation of $11.78 (overvalued by 18.76%) - 6 months ago
- jbryanscott created a new valuation of $11.78 (overvalued by 18.76%) - 6 months ago
- GordonGekko created a new valuation of $14.92 (undervalued by 5.52%) - 10 months ago
- SethWellbourne created a new valuation of $7.21 (overvalued by 47.22%) - 10 months ago
- SethWellbourne created a new valuation of $10.46 (overvalued by 17.64%) - 11 months ago
- turbocarlos created a new valuation of $15.37 (undervalued by 28.4%) - 1 year ago
- GordonGekko created a new valuation of $11.35 (undervalued by 7.28%) - 1 year ago
- TheCrunchBlog created a new valuation of $17.62 (undervalued by 36.59%) - 1 year ago
- GordonGekko created a new valuation of $15.43 (undervalued by 21.98%) - 1 year ago
- GordonGekko created a new valuation of $14.80 (overvalued by 3.33%) - 1 year ago
- TheCrunchBlog created a new valuation of $20.07 (overvalued by 27.6%) - 1 year ago
- TheCrunchBlog created a new valuation of $23.44 (overvalued by 13.19%) - 1 year ago
- TheCrunchBlog created a new valuation of $17.91 (overvalued by 33.67%) - 1 year ago
- GordonGekko created a new valuation of $20.07 (overvalued by 25.67%) - 1 year ago
- GordonGekko created a new valuation of $22.19 (undervalued by 2.4%) - 1 year ago
- KiwiEMH created a new valuation of $19.84 (overvalued by 7.29%) - 1 year ago
- GordonGekko created a new valuation of $21.80 (overvalued by 18.66%) - 1 year ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 21,394 |
| Net Debt (Long-term borrowings less cash): | -1,251 |
| Equity Value: | 28,424 |
| Number of Shares Outstanding: | 1,375,000,000 |
| Calculated value per share: | $22.19 |
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.