Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Autodesk Inc. (NASDAQ:ADSK)

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Present Value of Free Cash Flow to the Firm (FCFF)

Intermediate level


Intrinsic Stock Value (Valuation Summary)

Autodesk Inc., free cash flow to the firm (FCFF) forecast

US$ in thousands, except per share data

Microsoft Excel LibreOffice Calc
Year Value FCFFt or Terminal value (TVt) Calculation Present value at
01 FCFF0
1 FCFF1 = × (1 + )
2 FCFF2 = × (1 + )
3 FCFF3 = × (1 + )
4 FCFF4 = × (1 + )
5 FCFF5 = × (1 + )
5 Terminal value (TV5) = × (1 + ) ÷ ()
Intrinsic value of Autodesk Inc.’s capital
Less: Long-term notes payable, including current portion (fair value)
Intrinsic value of Autodesk Inc.’s common stock
 
Intrinsic value of Autodesk Inc.’s common stock (per share)
Current share price

Based on: 10-K (filing date: 2020-03-19).

Disclaimer!
Valuation is based on standard assumptions. There may exist specific factors relevant to stock value and omitted here. In such a case, the real stock value may differ significantly form the estimated. If you want to use the estimated intrinsic stock value in investment decision making process, do so at your own risk.


Weighted Average Cost of Capital (WACC)

Autodesk Inc., cost of capital

Microsoft Excel LibreOffice Calc
Value1 Weight Required rate of return2 Calculation
Equity (fair value)
Long-term notes payable, including current portion (fair value) = × (1 – )

Based on: 10-K (filing date: 2020-03-19).

1 US$ in thousands

   Equity (fair value) = No. shares of common stock outstanding × Current share price
= × =

   Long-term notes payable, including current portion (fair value). See details »

2 Required rate of return on equity is estimated by using CAPM. See details »

   Required rate of return on debt. See details »

   Required rate of return on debt is after tax.

   Estimated (average) effective income tax rate
= ( + + + + + ) ÷ 6 =

WACC =


FCFF Growth Rate (g)

FCFF growth rate (g) implied by PRAT model

Autodesk Inc., PRAT model

Microsoft Excel LibreOffice Calc
Average Jan 31, 2020 Jan 31, 2019 Jan 31, 2018 Jan 31, 2017 Jan 31, 2016 Jan 31, 2015
Selected Financial Data (US$ in thousands)
Interest and investment expense, net
Net income (loss)
 
Effective income tax rate (EITR)1
 
Interest and investment expense, net, after tax2
Interest expense (after tax) and dividends
 
EBIT(1 – EITR)3
 
Current portion of long-term notes payable, net
Long-term notes payable, net, excluding current portion
Stockholders’ equity (deficit)
Total capital
Financial Ratios
Retention rate (RR)4
Return on invested capital (ROIC)5
Averages
RR
ROIC
 
FCFF growth rate (g)6

Based on: 10-K (filing date: 2020-03-19), 10-K (filing date: 2019-03-25), 10-K (filing date: 2018-03-22), 10-K (filing date: 2017-03-21), 10-K (filing date: 2016-03-23), 10-K (filing date: 2015-03-18).

1 See details »

2020 Calculations

2 Interest and investment expense, net, after tax = Interest and investment expense, net × (1 – EITR)
= × (1 – ) =

3 EBIT(1 – EITR) = Net income (loss) + Interest and investment expense, net, after tax
= + =

4 RR = [EBIT(1 – EITR) – Interest expense (after tax) and dividends] ÷ EBIT(1 – EITR)
= [] ÷ =

5 ROIC = 100 × EBIT(1 – EITR) ÷ Total capital
= 100 × ÷ =

6 g = RR × ROIC
= × =


FCFF growth rate (g) implied by single-stage model

g = 100 × (Total capital, fair value0 × WACC – FCFF0) ÷ (Total capital, fair value0 + FCFF0)
= 100 × ( × ) ÷ ( + ) =

where:
Total capital, fair value0 = current fair value of Autodesk Inc.’s debt and equity (US$ in thousands)
FCFF0 = the last year Autodesk Inc.’s free cash flow to the firm (US$ in thousands)
WACC = weighted average cost of Autodesk Inc.’s capital


FCFF growth rate (g) forecast

Autodesk Inc., H-model

Microsoft Excel LibreOffice Calc
Year Value gt
1 g1
2 g2
3 g3
4 g4
5 and thereafter g5

where:
g1 is implied by PRAT model
g5 is implied by single-stage model
g2, g3 and g4 are calculated using linear interpoltion between g1 and g5

Calculations

g2 = g1 + (g5g1) × (2 – 1) ÷ (5 – 1)
= + () × (2 – 1) ÷ (5 – 1) =

g3 = g1 + (g5g1) × (3 – 1) ÷ (5 – 1)
= + () × (3 – 1) ÷ (5 – 1) =

g4 = g1 + (g5g1) × (4 – 1) ÷ (5 – 1)
= + () × (4 – 1) ÷ (5 – 1) =