Amazon.com, Inc. (AMZN)
Discount cash flow analysis
Sensitivity matrix
-1% |
Discount Rate % 0% |
1% |
||
---|---|---|---|---|
-1% | $58.69 | $57.61 | $56.58 | |
Terminal Growth% | 0 | $59.20 | $58.11 | $57.06 |
+1% | $59.74 | $58.62 | $57.55 |
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 $351.48 (overvalued by 55.49%) - 4 years ago
- Valuecruncher created a new valuation of $351.33 (overvalued by 54.67%) - 4 years ago
- SethWellbourne created a new valuation of $143.66 (undervalued by 2.57%) - over 10 years ago
- GordonGekko created a new valuation of $94.51 (overvalued by 22.17%) - almost 11 years ago
- beatallica created a new valuation of $74.74 (overvalued by 41.43%) - almost 11 years ago
- GordonGekko created a new valuation of $99.04 (overvalued by 24.82%) - 11 years ago
- SethWellbourne created a new valuation of $109.00 (overvalued by 10.39%) - 11 years ago
- GordonGekko created a new valuation of $70.97 (overvalued by 9.0%) - over 11 years ago
- SethWellbourne created a new valuation of $53.54 (overvalued by 32.4%) - over 11 years ago
- SethWellbourne created a new valuation of $65.61 (overvalued by 8.16%) - over 11 years ago
- GordonGekko created a new valuation of $48.71 (overvalued by 5.58%) - almost 12 years ago
- TheCrunchBlog created a new valuation of $62.65 (overvalued by 10.45%) - 12 years ago
- GordonGekko created a new valuation of $60.34 (overvalued by 25.51%) - 12 years ago
- KiwiEMH created a new valuation of $81.16 (undervalued by 0.48%) - 12 years ago
- GordonGekko created a new valuation of $83.39 (undervalued by 0.34%) - over 12 years ago
- GordonGekko created a new valuation of $76.27 (overvalued by 4.88%) - over 12 years ago
- sethc created a new valuation of $58.29 (overvalued by 24.6%) - over 12 years ago
- virtualmark created a new valuation of $44.07 (overvalued by 40.87%) - over 12 years ago
- TheCrunchBlog created a new valuation of $59.00 (overvalued by 19.54%) - over 12 years ago
- KiwiEMH created a new valuation of $78.46 (overvalued by 0.33%) - over 12 years ago
- KiwiEMH created a new valuation of $79.54 (overvalued by 1.2%) - over 12 years ago
- Sam created a new valuation of $58.11 (overvalued by 27.53%) - over 12 years ago
Comments
The boring details
All amounts in millions | Figures |
Enterprise Value: | 327,798 |
Net Debt (Long-term borrowings less cash): | -1,830 |
Equity Value: | 33,466 |
Number of Shares Outstanding: | 417,000,000 |
Calculated value per share: | $58.11 |
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.