Qantas Airways Limited (QAN)

Discount cash flow analysis

Sell Overvalued by 28.1%

5% margin of safety What's this?

close

How does this work?

This is an interactive analyst report for Qantas Airways Limited, 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.

Spacer
Values in $ millions
2008 2009 2010 2011 2012 2013 2014 2015
 
                 
               
 

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% $2.30 $2.27 $2.24
Terminal Growth% 0 $2.31 $2.28 $2.25
  +1% $2.32 $2.29 $2.26

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 $16.95 (undervalued by 434.7%) - 11 months ago
  • brl24 created a new valuation of $1.71 (overvalued by 18.96%) - 8 years ago
  • GordonGekko created a new valuation of $2.06 (overvalued by 7.62%) - 8 years ago
  • SethWellbourne created a new valuation of $2.21 (undervalued by 26.29%) - over 8 years ago
  • GordonGekko created a new valuation of $2.28 (undervalued by 30.29%) - over 8 years ago
  • ngupta88 created a new valuation of $3.21 (undervalued by 88.82%) - over 8 years ago
  • KiwiEMH created a new valuation of $3.20 (overvalued by 2.44%) - 9 years ago
  • Abo created a new valuation of $2.86 (overvalued by 15.88%) - over 9 years ago
  • KiwiEMH created a new valuation of $3.49 (undervalued by 6.08%) - over 9 years ago
  • GordonGekko created a new valuation of $3.51 (undervalued by 0.57%) - over 9 years ago
  • Sam created a new valuation of $3.80 (undervalued by 8.88%) - over 9 years ago

Comments

No comments yet. Login to comment.

The boring details

All amounts in millions Figures
Enterprise Value: 7,522
Net Debt (Long-term borrowings less cash): 485
Equity Value: 3,873
Number of Shares Outstanding: 2,219,000,000
Calculated value per share: $2.28

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.