CF conv.

CF Value
EBITDA 11.0
EBIT 10.0 (-) Rec. Capex (1.0)
(-) Taxes (3.0) (-) Taxes (3.0)
(=) NOPAT 7.0 FCF pre g Inv. 7.0
(+) Depreciation 1.0 (+/-) Other
(-) CAPEX (4.5) (-) Exp. Capex (3.5)
(-) ∆ Working Capital - (-) ∆ Working Capital -
(=) Net Investment (3.5) (=) Growth Investments (3.5)
(=) FCFF 3.5 (=) FCF 3.5
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5 Terminal Value
EBIT 10.0 11.0 12.1 13.3 14.6 14.9
(-) Taxes (3.0) (3.3) (3.6) (4.0) (4.4) (4.5)
(=) NOPAT 7.0 7.7 8.5 9.3 10.2 10.5
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (3.5) (3.9) (4.2) (4.7) (5.1) (1.0)
(=) FCFF 3.5 3.9 4.2 4.7 5.1 9.4

Invested Capital BoP 35.0 38.5 42.4 46.6 51.2 52.27

ROIC 20% 20% 20% 20% 20% 20%
Valuation
Terminal Value 117.6
Discounted CFs 3.18 3.18 3.18 3.18 76.20
Enterprise Value 88.93

Check - - - - - 0.0
Assumptions Value Creation 10%
Tax Rate 30% Value Creation 10%
ROIC 20%
Reinvestment Rate 50%
WACC 10%
g NOPAT 10%
Assumptions TV
Tax Rate 30%
ROIC 20%
Reinvestment Rate 10%
WACC 10%
g NOPAT 2%
 1 2 3 4 5
Year-2 Year-3 Year-4 Year-5 Year-6 Terminal Value
EBIT 11.0 12.1 13.3 14.6 16.1 16.4
(-) Taxes (3.3) (3.6) (4.0) (4.4) (4.8) (4.9)
(=) NOPAT 7.7 8.5 9.3 10.2 11.3 11.5
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (3.9) (4.2) (4.7) (5.1) (5.6) (1.1)
(=) FCFF 3.9 4.2 4.7 5.1 5.6 10.3

Invested Capital 38.5 42.4 46.6 51.2 56.4 57.50

ROIC 20% 20% 20% 20% 20% 20%
Valuation
Terminal Value 129.4
Discounted CFs 3.50 3.50 3.50 3.50 83.83
Enterprise Value 97.83

Check - - - - - 0.0
Assumptions
Tax Rate 30%
ROIC 20%
Reinvestment Rate 50%
WACC 10%
g NOPAT 10%
Assumptions TV
Tax Rate 30%
ROIC 20%
Reinvestment Rate 10%
WACC 10%
g NOPAT 2%
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5 Terminal Value
EBIT 10.0 10.3 10.6 10.9 11.3 11.4
(-) Taxes (3.0) (3.1) (3.2) (3.3) (3.4) (3.4)
(=) NOPAT 7.0 7.2 7.4 7.6 7.9 8.0
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (1.8) (1.8) (1.9) (1.9) (2.0) (0.8)
(=) FCFF 5.3 5.4 5.6 5.7 5.9 7.2

Invested Capital BoP 58.3 60.1 61.9 63.7 65.7 66.44

ROIC 12% 12% 12% 12% 12% 12%
Valuation
Terminal Value 81.5
Discounted CFs 4.77 4.47 4.18 3.92 54.30
Enterprise Value 71.65

Check 0.0 - - - - 0.0

Assumptions Value Creation 3.0%
Tax Rate 30% Value Creation 3.0%
ROIC 12%
Reinvestment Rate 25% 3%
WACC 10%
g NOPAT 3%
Assumptions TV
Tax Rate 30%
ROIC 12%
Reinvestment Rate 10%
WACC 10%
g NOPAT 1%
 1 2 3 4 5
Year-2 Year-3 Year-4 Year-5 Year-6 Terminal Value
EBIT 10.3 10.6 10.9 11.3 11.6 11.7
(-) Taxes (3.1) (3.2) (3.3) (3.4) (3.5) (3.5)
(=) NOPAT 7.2 7.4 7.6 7.9 8.1 8.2
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (1.8) (1.9) (1.9) (2.0) (2.0) (0.8)
(=) FCFF 5.4 5.6 5.7 5.9 6.1 7.4

Invested Capital 60.1 61.9 63.7 65.7 67.6 68.44

ROIC 12% 12% 12% 12% 12% 12%
Valuation
Terminal Value 84.0
Discounted CFs 4.92 4.60 4.31 4.04 55.93
Enterprise Value 73.79

Check 0.0 - - - - 0.0

Assumptions
Tax Rate 30%
ROIC 12%
Reinvestment Rate 25%
WACC 10%
g NOPAT 3%
Assumptions TV
Tax Rate 30%
ROIC 12%
Reinvestment Rate 10%
WACC 10%
g NOPAT 1%
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5 Terminal Value
EBIT 10.0 10.4 10.8 11.2 11.7 11.8
(-) Taxes (3.0) (3.1) (3.2) (3.4) (3.5) (3.5)
(=) NOPAT 7.0 7.3 7.6 7.9 8.2 8.3
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (5.6) (5.8) (6.1) (6.3) (6.6) (1.7)
(=) FCFF 1.4 1.5 1.5 1.6 1.6 6.6

Invested Capital BoP 140.0 145.6 151.4 157.5 163.8 165.42

ROIC 5% 5% 5% 5% 5% 5%
Valuation
Terminal Value 73.5
Discounted CFs 1.27 1.20 1.14 1.08 46.67
Enterprise Value 51.36

Check - - 0.0 - 0.0 - 0.0

Assumptions Value Destruction -17.5%
Tax Rate 30%
ROIC 5%
Reinvestment Rate 80%
WACC 10%
g NOPAT 4%
Assumptions TV
Tax Rate 30%
ROIC 5%
Reinvestment Rate 20%
WACC 10%
g NOPAT 1%
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5 Terminal Value
EBIT 10.0 10.1 10.2 10.3 10.4 10.5
(-) Taxes (3.0) (3.0) (3.1) (3.1) (3.1) (3.2)
(=) NOPAT 7.0 7.1 7.1 7.2 7.3 7.4
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
(=) Net Investment (1.4) (1.4) (1.4) (1.4) (1.5) (1.5)
(=) FCFF 5.6 5.7 5.7 5.8 5.8 5.9

Invested Capital 140.0 141.4 142.8 144.2 145.7 147.14

ROIC 5% 5% 5% 5% 5% 5%
Valuation
Terminal Value 65.4
Discounted CFs 5.09 4.67 4.29 3.94 44.22
Enterprise Value 62.22

Check 0.0 - 0.0 0.0 - - 0.0

Assumptions
Tax Rate 30%
ROIC 5%
Reinvestment Rate 20%
WACC 10%
g NOPAT 1%
Assumptions TV
Tax Rate 30%
ROIC 5%
Reinvestment Rate 20%
WACC 10%
g NOPAT 1%
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5
EBITDA 153 183 220 264 317
Maintenance CAPEX (10) (12) (14) (17) (21)
Taxes (43) (51) (62) (74) (89)
FCF 100 120 144 173 207
Growth Investment (100) (120) (144) (173) (207)
FCF - - - - -
Invested Capital 500 600 720 864 1,037
ROIC 20% 20% 20% 20% 20%
TIR CF (2,000) - - - -

Assumptions
ROIC 20%
Reinvestment Rate 100%
g FCF norm. 20%
Return Calculations
Holding Period 40
Entry Multiple 20
Exit Multiple 10
Annualized Return 17.9%

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
 6 7 8 9 10 11 12
Year-6 Year-7 Year-8 Year-9 Year-10 Year-11 Year-12
380 456 548 657 789 946 1,136
(25) (30) (36) (43) (52) (62) (74)
(107) (128) (154) (184) (221) (265) (318)
249 299 358 430 516 619 743
(249) (299) (358) (430) (516) (619) (743)
- - - - - - -
1,244 1,493 1,792 2,150 2,580 3,096 3,715
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
 13 14 15 16 17 18 19
Year-13 Year-14 Year-15 Year-16 Year-17 Year-18 Year-19
1,363 1,635 1,963 2,355 2,826 3,391 4,070
(89) (107) (128) (154) (185) (222) (266)
(382) (459) (550) (660) (792) (951) (1,141)
892 1,070 1,284 1,541 1,849 2,219 2,662
(892) (1,070) (1,284) (1,541) (1,849) (2,219) (2,662)
- - - - - - -
4,458 5,350 6,420 7,704 9,244 11,093 13,312
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
 20 21 22 23 24 25 26
Year-20 Year-21 Year-22 Year-23 Year-24 Year-25 Year-26
4,883 5,860 7,032 8,439 10,126 12,152 14,582
(319) (383) (460) (552) (662) (795) (954)
(1,369) (1,643) (1,972) (2,366) (2,839) (3,407) (4,088)
3,195 3,834 4,601 5,521 6,625 7,950 9,540
(3,195) (3,834) (4,601) (5,521) (6,625) (7,950) (9,540)
- - - - - - -
15,974 19,169 23,003 27,603 33,124 39,748 47,698
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
 27 28 29 30 31 32 33
Year-27 Year-28 Year-29 Year-30 Year-31 Year-32 Year-33
17,498 20,998 25,198 30,237 36,285 43,542 52,250
(1,145) (1,374) (1,648) (1,978) (2,374) (2,849) (3,418)
(4,906) (5,887) (7,065) (8,478) (10,173) (12,208) (14,650)
11,448 13,737 16,484 19,781 23,738 28,485 34,182
(11,448) (13,737) (16,484) (19,781) (23,738) (28,485) (34,182)
- - - - - - -
57,238 68,685 82,422 98,907 118,688 142,426 170,911
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
 34 35 36 37 38 39 40
Year-34 Year-35 Year-36 Year-37 Year-38 Year-39 Year-40
62,700 75,240 90,288 108,345 130,015 156,017 187,221
(4,102) (4,922) (5,907) (7,088) (8,506) (10,207) (12,248)
(17,579) (21,095) (25,314) (30,377) (36,453) (43,743) (52,492)
41,019 49,222 59,067 70,880 85,056 102,067 122,481
(41,019) (49,222) (59,067) (70,880) (85,056) (102,067) (122,481)
- - - - - - -
205,093 246,112 295,334 354,401 425,281 510,337 612,405
20% 20% 20% 20% 20% 20% 20%
- - - - - - 1,224,810
 1 2 3 4 5
Year-1 Year-2 Year-3 Year-4 Year-5
EBITDA 153 168 185 203 224
Maintenance CAPEX (10) (11) (12) (13) (15)
Taxes (43) (47) (52) (57) (63)
FCF 100 110 121 133 146
Growth Investment (50) (55) (61) (67) (73)
FCF 50 55 61 67 73
Invested Capital 500 550 605 666 732
ROIC 20% 20% 20% 20% 20%
TIR CF (2,500) 55 61 67 73

Assumptions
ROIC 20%
Reinvestment Rate 50%
g FCF norm. 10%
Return Calculations
Holding Period 20
Entry Multiple 25
Exit Multiple 15
Annualized Return 9.7%

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
 6 7 8 9 10 11 12
Year-6 Year-7 Year-8 Year-9 Year-10 Year-11 Year-12
246 271 298 328 360 396 436
(16) (18) (19) (21) (24) (26) (29)
(69) (76) (84) (92) (101) (111) (122)
161 177 195 214 236 259 285
(81) (89) (97) (107) (118) (130) (143)
81 89 97 107 118 130 143
805 886 974 1,072 1,179 1,297 1,427
20% 20% 20% 20% 20% 20% 20%
81 89 97 107 118 130 143
 13 14 15 16 17 18 19
Year-13 Year-14 Year-15 Year-16 Year-17 Year-18 Year-19
480 528 580 639 702 773 850
(31) (35) (38) (42) (46) (51) (56)
(135) (148) (163) (179) (197) (217) (238)
314 345 380 418 459 505 556
(157) (173) (190) (209) (230) (253) (278)
157 173 190 209 230 253 278
1,569 1,726 1,899 2,089 2,297 2,527 2,780
20% 20% 20% 20% 20% 20% 20%
157 173 190 209 230 253 278
 20 21 22 23 24 25 26
Year-20 Year-21 Year-22 Year-23 Year-24 Year-25 Year-26
935 1,028 1,131 1,244 1,369 1,506 1,656
(61) (67) (74) (81) (90) (98) (108)
(262) (288) (317) (349) (384) (422) (464)
612 673 740 814 895 985 1,083
(306) (336) (370) (407) (448) (492) (542)
306 336 370 407 448 492 542
3,058 3,364 3,700 4,070 4,477 4,925 5,417
20% 20% 20% 20% 20% 20% 20%
9,174 - - - - - -
 27 28 29 30 31 32 33
Year-27 Year-28 Year-29 Year-30 Year-31 Year-32 Year-33
1,822 2,004 2,204 2,425 2,667 2,934 3,227
(119) (131) (144) (159) (174) (192) (211)
(511) (562) (618) (680) (748) (823) (905)
1,192 1,311 1,442 1,586 1,745 1,919 2,111
(596) (655) (721) (793) (872) (960) (1,056)
596 655 721 793 872 960 1,056
5,959 6,555 7,210 7,932 8,725 9,597 10,557
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
 34 35 36 37 38 39 40
Year-34 Year-35 Year-36 Year-37 Year-38 Year-39 Year-40
3,550 3,905 4,296 4,725 5,198 5,718 6,289
(232) (255) (281) (309) (340) (374) (411)
(995) (1,095) (1,204) (1,325) (1,457) (1,603) (1,763)
2,323 2,555 2,810 3,091 3,400 3,740 4,114
(1,161) (1,277) (1,405) (1,546) (1,700) (1,870) (2,057)
1,161 1,277 1,405 1,546 1,700 1,870 2,057
11,613 12,774 14,051 15,456 17,002 18,702 20,572
20% 20% 20% 20% 20% 20% 20%
- - - - - - -
GREAT BUSINESS- EXPENSIVE
https://www.youtube.com/watch?v=YZM9dhiDbzI
1 2 3 4 5 6 7 8
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8
EBIT 10.0 12.0 14.4 17.3 20.7 24.9 29.9 35.8
(-) Taxes (3.0) (3.6) (4.3) (5.2) (6.2) (7.5) (9.0) (10.7)
(=) NOPAT 7.0 8.4 10.1 12.1 14.5 17.4 20.9 25.1
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
FCF Pre Growth Inv 7.0 8.4 10.1 12.1 14.5 17.4 20.9 25.1
(=) Net Investment (7.0) (8.4) (10.1) (12.1) (14.5) (17.4) (20.9) (25.1)
(=) FCFF - - - - - - - -

Invested Capital BoP 35.0 42.0 50.4 60.5 72.6 87.1 104.5 125.4
ROIC 20% 20% 20% 20% 20% 20% 20% 20%
Return Calculation

Entry Multiple 15.0

Exit Multiple 7.5
Entry Price 105.0
Exit Price 64,302.5
CAGR 17.9%
Check - - - - - - -
Assumptions
Tax Rate 30%
ROIC 20%
Reinvestment Rate 100%
WACC 10%
g EBIT 20%
Assumptions TV
Tax Rate 30%
ROIC 20%
Reinvestment Rate 10%
WACC 10%
g EBIT 2%
 9 10 11 12 13 14 15 16 17 18 19 20
Year-9 Year-10 Year-11 Year-12 Year-13 Year-14 Year-15 Year-16 Year-17 Year-18 Year-19 Year-20
43.0 51.6 61.9 74.3 89.2 107.0 128.4 154.1 184.9 221.9 266.2 319.5
(12.9) (15.5) (18.6) (22.3) (26.7) (32.1) (38.5) (46.2) (55.5) (66.6) (79.9) (95.8)
30.1 36.1 43.3 52.0 62.4 74.9 89.9 107.8 129.4 155.3 186.4 223.6

30.1 36.1 43.3 52.0 62.4 74.9 89.9 107.8 129.4 155.3 186.4 223.6
(30.1) (36.1) (43.3) (52.0) (62.4) (74.9) (89.9) (107.8) (129.4) (155.3) (186.4) (223.6)
- - - - - - - - - - - -

150.5 180.6 216.7 260.1 312.1 374.5 449.4 539.2 647.1 776.5 931.8 ###
20% 20% 20% 20% 20% 20% 20% 20% 20% 20% 20% 20%

- - - - - - - - - - - -
 21 22 23 24 25 26 27 28 29 30 31
Year-21 Year-22 Year-23 Year-24 Year-25 Year-26 Year-27 Year-28 Year-29 Year-30 Year-31
383.4 460.1 552.1 662.5 795.0 954.0 ### ### 1,648.4 1,978.1 2,373.8
(115.0) (138.0) (165.6) (198.7) (238.5) (286.2) (343.4) (412.1) (494.5) (593.4) (712.1)
268.4 322.0 386.4 463.7 556.5 667.8 801.3 961.6 1,153.9 1,384.7 1,661.6

268.4 322.0 386.4 463.7 556.5 667.8 801.3 961.6 1,153.9 1,384.7 1,661.6
(268.4) (322.0) (386.4) (463.7) (556.5) (667.8) (801.3) (961.6) (1,153.9) (1,384.7) (1,661.6)
- - - - - - - - - - -

### ### ### ### ### ### ### ### 5,769.6 6,923.5 8,308.2
20% 20% 20% 20% 20% 20% 20% 20% 20% 20% 20%

- - - - - - - - - - -
 32 33 34 35 36 37 38 39 40
Year-32 Year-33 Year-34 Year-35 Year-36 Year-37 Year-38 Year-39 Year-40
2,848.5 3,418.2 4,101.9 4,922.2 5,906.7 7,088.0 8,505.6 10,206.7 12,248.1
(854.6) (1,025.5) (1,230.6) (1,476.7) (1,772.0) (2,126.4) (2,551.7) (3,062.0) (3,674.4)
1,994.0 2,392.8 2,871.3 3,445.6 4,134.7 4,961.6 5,953.9 7,144.7 8,573.7

1,994.0 2,392.8 2,871.3 3,445.6 4,134.7 4,961.6 5,953.9 7,144.7 8,573.7

(1,994.0) (2,392.8) (2,871.3) (3,445.6) (4,134.7) (4,961.6) (5,953.9) (7,144.7) (8,573.7)
- - - - - - - - -

9,969.8 11,963.8 14,356.5 17,227.8 20,673.4 24,808.1 29,769.7 35,723.6 42,868.3

20% 20% 20% 20% 20% 20% 20% 20% 20%

- - - - - - - - -
MEDIOCRE BUSINESS- CHEAP

1 2 3 4 5 6 7 8
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8
EBIT 10.0 11.0 12.1 13.3 14.6 16.1 17.7 19.5
(-) Taxes (3.0) (3.3) (3.6) (4.0) (4.4) (4.8) (5.3) (5.8)
(=) NOPAT 7.0 7.7 8.5 9.3 10.2 11.3 12.4 13.6
(+) Depreciation
(-) CAPEX
(-) ∆ Working Capital
FCF Pre Growth Inv 7.0 7.7 8.5 9.3 10.2 11.3 12.4 13.6
(=) Net Investment (7.0) (7.7) (8.5) (9.3) (10.2) (11.3) (12.4) (13.6)
(=) FCFF - - - - - - - -

Invested Capital BoP 70.0 77.0 84.7 93.2 102.5 112.7 124.0 136.4
ROIC 10% 10% 10% 10% 10% 10% 10% 10%
Return Calculation

Entry Multiple 7.5

Exit Multiple 15.0
Entry Price 52.5
Exit Price 4,320.2
CAGR 12.0%
Check - - - - - - -
Assumptions
Tax Rate 30%
ROIC 10%
Reinvestment Rate 100%
WACC 10%
g EBIT 10%
Assumptions TV
Tax Rate 30%
ROIC 10%
Reinvestment Rate 10%
WACC 10%
g EBIT 1%
 9 10 11 12 13 14 15 16 17 18 19 20
Year-9 Year-10 Year-11 Year-12 Year-13 Year-14 Year-15 Year-16 Year-17 Year-18 Year-19 Year-20
21.4 23.6 25.9 28.5 31.4 34.5 38.0 41.8 45.9 50.5 55.6 61.2
(6.4) (7.1) (7.8) (8.6) (9.4) (10.4) (11.4) (12.5) (13.8) (15.2) (16.7) (18.3)
15.0 16.5 18.2 20.0 22.0 24.2 26.6 29.2 32.2 35.4 38.9 42.8

15.0 16.5 18.2 20.0 22.0 24.2 26.6 29.2 32.2 35.4 38.9 42.8
(15.0) (16.5) (18.2) (20.0) (22.0) (24.2) (26.6) (29.2) (32.2) (35.4) (38.9) (42.8)
- - - - - - - - - - - -

150.1 165.1 181.6 199.7 219.7 241.7 265.8 292.4 321.6 353.8 389.2 428.1
10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%

- - - - - - - - - - - -
 21 22 23 24 25 26 27 28 29 30 31
Year-21 Year-22 Year-23 Year-24 Year-25 Year-26 Year-27 Year-28 Year-29 Year-30 Year-31
67.3 74.0 81.4 89.5 98.5 108.3 119.2 131.1 144.2 158.6 174.5
(20.2) (22.2) (24.4) (26.9) (29.5) (32.5) (35.8) (39.3) (43.3) (47.6) (52.3)
47.1 51.8 57.0 62.7 68.9 75.8 83.4 91.8 100.9 111.0 122.1

47.1 51.8 57.0 62.7 68.9 75.8 83.4 91.8 100.9 111.0 122.1
(47.1) (51.8) (57.0) (62.7) (68.9) (75.8) (83.4) (91.8) (100.9) (111.0) (122.1)
- - - - - - - - - - -

470.9 518.0 569.8 626.8 689.5 758.4 834.3 917.7 1,009.5 1,110.4 1,221.5
10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%

- - - - - 0.0 - 0.0 - - -
 32 33 34 35 36 37 38 39 40
Year-32 Year-33 Year-34 Year-35 Year-36 Year-37 Year-38 Year-39 Year-40
191.9 211.1 232.3 255.5 281.0 309.1 340.0 374.0 411.4
(57.6) (63.3) (69.7) (76.6) (84.3) (92.7) (102.0) (112.2) (123.4)
134.4 147.8 162.6 178.8 196.7 216.4 238.0 261.8 288.0

134.4 147.8 162.6 178.8 196.7 216.4 238.0 261.8 288.0

(134.4) (147.8) (162.6) (178.8) (196.7) (216.4) (238.0) (261.8) (288.0)
- - - - - - - - -

1,343.6 1,478.0 1,625.8 1,788.3 1,967.2 2,163.9 2,380.3 2,618.3 2,880.1

10% 10% 10% 10% 10% 10% 10% 10% 10%

- - - - - - - - -