Abbott Laboratories (ABT)
Discount cash flow analysis
Price history
Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $54.10 | $53.32 | $52.56 | |
| Terminal Growth% | 0 | $54.30 | $53.51 | $52.75 |
| +1% | $54.50 | $53.71 | $52.94 |
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 $61.06 (undervalued by 45.66%) - over 4 years ago
- Valuecruncher created a new valuation of $61.05 (undervalued by 46.47%) - over 4 years ago
- tobyzero created a new valuation of $53.51 (overvalued by 0.82%) - almost 11 years ago
- tobyzero created a new valuation of $53.51 (overvalued by 0.82%) - almost 11 years ago
- dcullers created a new valuation of $84.63 (undervalued by 58.9%) - 11 years ago
- dcullers created a new valuation of $71.51 (undervalued by 34.27%) - 11 years ago
- dionysus6504 created a new valuation of $53.25 (undervalued by 20.15%) - over 11 years ago
- GordonGekko created a new valuation of $54.24 (undervalued by 22.94%) - almost 12 years ago
- swampler created a new valuation of $57.07 (undervalued by 29.35%) - almost 12 years ago
- swampler created a new valuation of $52.12 (undervalued by 11.61%) - almost 12 years ago
- nazrul created a new valuation of $60.06 (undervalued by 28.88%) - almost 12 years ago
- tuxmask created a new valuation of $95.86 (undervalued by 81.14%) - 12 years ago
- dweis created a new valuation of $71.40 (undervalued by 26.22%) - 12 years ago
- GordonGekko created a new valuation of $58.65 (undervalued by 1.66%) - over 12 years ago
- rbhatia created a new valuation of $92.37 (undervalued by 70.14%) - over 12 years ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 71,204 |
| Net Debt (Long-term borrowings less cash): | 6,365 |
| Equity Value: | 83,446 |
| Number of Shares Outstanding: | 1,546,000,000 |
| Calculated value per share: | $53.51 |
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.