Intel Corporation (INTC)

Discount cash flow analysis

Sell Overvalued by 40.2%

5% margin of safety What's this?

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How does this work?

This is an interactive analyst report for Intel Corporation, based on a discounted cash flow valuation approach.

You can modify the assumptions and the valuation will be updated automatically. You can also save and share your valuation.

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Values in $ millions
2009 2010 2011 2012 2013 2014 2015 2016
 
                 
               
 

What will the revenues be in the future?

Growth beyond year three is driven by the terminal growth rate.

Sensitivity matrix

   
-1%
Discount Rate %
0%

1%
  -1% $22.40 $22.15 $21.89
Terminal Growth% 0 $22.48 $22.22 $21.96
  +1% $22.55 $22.29 $22.03

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 $33.62 (overvalued by 9.48%) - 9 months ago
  • RichC created a new valuation of $26.26 (undervalued by 17.39%) - almost 6 years ago
  • ChannelIslands created a new valuation of $18.45 (overvalued by 10.74%) - 7 years ago
  • ChannelIslands created a new valuation of $19.53 (overvalued by 9.58%) - 7 years ago
  • GordonGekko created a new valuation of $22.22 (undervalued by 6.11%) - over 7 years ago
  • chmakar created a new valuation of $3.33 (overvalued by 84.1%) - over 7 years ago
  • apc1015 created a new valuation of $15.97 (overvalued by 19.67%) - over 7 years ago
  • apc1015 created a new valuation of $15.97 (overvalued by 19.67%) - over 7 years ago
  • apc1015 created a new valuation of $16.15 (overvalued by 18.76%) - over 7 years ago
  • tweakedmelon created a new valuation of $18.17 (overvalued by 3.3%) - almost 8 years ago
  • SethWellbourne created a new valuation of $13.78 (overvalued by 8.13%) - 8 years ago
  • SethWellbourne created a new valuation of $16.68 (undervalued by 13.32%) - 8 years ago
  • afi created a new valuation of $17.58 (undervalued by 19.59%) - over 8 years ago
  • TheCrunchBlog created a new valuation of $17.92 (undervalued by 12.49%) - over 8 years ago
  • DharmaWarrior created a new valuation of $24.80 (undervalued by 33.69%) - almost 9 years ago
  • acoy created a new valuation of $22.27 (overvalued by 2.15%) - 9 years ago

Comments

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The boring details

All amounts in millions Figures
Enterprise Value: 193,462
Net Debt (Long-term borrowings less cash): -11,699
Equity Value: 115,672
Number of Shares Outstanding: 5,524,000,000
Calculated value per share: $22.22

Enterprise Value is the present value of the post-tax cash flows for a business into the future.


Calcuation of EV

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.


Perpetuity

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.


CAPM model

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.