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Breakdown · RY.TO

Royal Bank of Canada

WACC
FCF PROJECTION
SENSITIVITY
PER-YEAR CASH FLOWS
Year CF Discount factor PV Cumulative PV
1 24.13 0.8984 21.68 21.68
2 27.75 0.8071 22.40 44.07
3 31.91 0.7252 23.14 67.21
4 36.70 0.6515 23.91 91.12
5 42.20 0.5853 24.70 115.82
6 48.53 0.5258 25.52 141.34
7 55.81 0.4724 26.37 167.70
8 64.18 0.4244 27.24 194.94
9 73.81 0.3813 28.14 223.09
10 84.88 0.3426 29.08 252.16
11 87.00 0.3078 26.78 278.94
12 89.18 0.2765 24.66 303.60
13 91.40 0.2484 22.71 326.31
14 93.69 0.2232 20.91 347.22
15 96.03 0.2005 19.26 366.47
16 98.43 0.1801 17.73 384.20
17 100.89 0.1618 16.33 400.53
18 103.42 0.1454 15.04 415.57
19 106.00 0.1306 13.85 429.42
20 108.65 0.1174 12.75 442.17
REVERSE DCF

At $270.60, the market implies a stage-1 growth rate of 7.5%.

MARKET IMPLIES
7.5%
YOUR ASSUMPTION
15.0%
DELTA
-7.5pp

If $270.60 is correct and your other inputs (WACC 11.3%, 10+10y, terminal 2.5%) hold, the market needs RY.TO to grow cash flow at 7.5% annually for the next 10 years.