WACC
PREDICTABILITY
GROWTH WINDOWS
FCF PROJECTION
SENSITIVITY
PER-YEAR CASH FLOWS
| Year | CF | Discount factor | PV | Cumulative PV |
|---|---|---|---|---|
| 1 | 24.11 | 0.9172 | 22.11 | 22.11 |
| 2 | 24.59 | 0.8412 | 20.69 | 42.80 |
| 3 | 25.08 | 0.7716 | 19.35 | 62.16 |
| 4 | 25.59 | 0.7077 | 18.11 | 80.26 |
| 5 | 26.10 | 0.6491 | 16.94 | 97.21 |
| 6 | 26.62 | 0.5953 | 15.85 | 113.05 |
| 7 | 27.15 | 0.5461 | 14.83 | 127.88 |
| 8 | 27.70 | 0.5008 | 13.87 | 141.75 |
| 9 | 28.25 | 0.4594 | 12.98 | 154.73 |
| 10 | 28.81 | 0.4213 | 12.14 | 166.87 |
| 11 | 29.53 | 0.3864 | 11.41 | 178.28 |
| 12 | 30.27 | 0.3544 | 10.73 | 189.01 |
| 13 | 31.03 | 0.3251 | 10.09 | 199.10 |
| 14 | 31.81 | 0.2982 | 9.48 | 208.58 |
| 15 | 32.60 | 0.2735 | 8.92 | 217.50 |
| 16 | 33.42 | 0.2508 | 8.38 | 225.88 |
| 17 | 34.25 | 0.2301 | 7.88 | 233.76 |
| 18 | 35.11 | 0.2110 | 7.41 | 241.17 |
| 19 | 35.99 | 0.1935 | 6.96 | 248.13 |
| 20 | 36.88 | 0.1775 | 6.55 | 254.68 |
REVERSE DCF
At $399.47, the market implies a stage-1 growth rate of 8.7%.
MARKET IMPLIES
8.7%
YOUR ASSUMPTION
2.0%
DELTA
+6.7pp
If $399.47 is correct and your other inputs (WACC 9.0%, 10+10y, terminal 2.5%) hold, the market needs UNH to grow cash flow at 8.7% annually for the next 10 years.