Cisco Systems, Inc. (CSCO)
Discount cash flow analysis
Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $27.95 | $27.58 | $27.22 | |
| Terminal Growth% | 0 | $28.08 | $27.71 | $27.35 |
| +1% | $28.22 | $27.85 | $27.48 |
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 $32.32 (undervalued by 3.06%) - 11 months ago
- RichC created a new valuation of $25.39 (undervalued by 84.92%) - 6 years ago
- RichC created a new valuation of $23.25 (undervalued by 50.1%) - 6 years ago
- RichC created a new valuation of $23.25 (undervalued by 50.1%) - 6 years ago
- RichC created a new valuation of $24.38 (undervalued by 48.84%) - 6 years ago
- SethWellbourne created a new valuation of $22.16 (overvalued by 16.69%) - over 7 years ago
- GordonGekko created a new valuation of $27.71 (undervalued by 6.45%) - over 7 years ago
- sartzberger created a new valuation of $18.45 (overvalued by 19.68%) - over 7 years ago
- ecombarnardnet created a new valuation of $21.76 (overvalued by 3.59%) - 8 years ago
- Lespe959 created a new valuation of $20.57 (undervalued by 9.88%) - over 8 years ago
- SethWellbourne created a new valuation of $10.01 (overvalued by 38.63%) - over 8 years ago
- GordonGekko created a new valuation of $20.39 (undervalued by 20.29%) - over 8 years ago
- GordonGekko created a new valuation of $20.44 (undervalued by 20.59%) - over 8 years ago
- savov created a new valuation of $16.72 (overvalued by 1.53%) - over 8 years ago
- GordonGekko created a new valuation of $19.60 (undervalued by 19.15%) - over 8 years ago
- charmonman created a new valuation of $21.40 (undervalued by 24.56%) - almost 9 years ago
- KiwiEMH created a new valuation of $17.84 (undervalued by 2.47%) - almost 9 years ago
- DharmaWarrior created a new valuation of $30.20 (undervalued by 38.53%) - almost 9 years ago
- TheCrunchBlog created a new valuation of $28.51 (undervalued by 19.14%) - 9 years ago
- GordonGekko created a new valuation of $29.73 (undervalued by 24.24%) - 9 years ago
- KiwiEMH created a new valuation of $22.24 (undervalued by 0.32%) - 9 years ago
- GordonGekko created a new valuation of $23.84 (undervalued by 9.56%) - over 9 years ago
- GordonGekko created a new valuation of $26.92 (undervalued by 0.94%) - over 9 years ago
- silas created a new valuation of $18.26 (overvalued by 27.97%) - over 9 years ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 154,849 |
| Net Debt (Long-term borrowings less cash): | -24,706 |
| Equity Value: | 149,038 |
| Number of Shares Outstanding: | 5,725,000,000 |
| Calculated value per share: | $27.71 |
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.