DCF Studio

    BC.MI · MIL · Consumer Cyclical

    Brunello Cucinelli S.p.A.

    Also onConsensus Drift

    Implied value per share

    EUR 55.53

    Market price

    EUR 79.00

    Implied upside

    -29.7%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    EUR 55.53-29.7%
    Exit multiple
    EUR 130.78+65.5%
    Market price
    EUR 79.00

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0m185m369mFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 1.6bnEUR 1.9bnEUR 2.2bnEUR 2.5bnEUR 2.9bn+15.3%
    EBITEUR 276.5mEUR 318.6mEUR 367.2mEUR 423.2mEUR 487.8m+15.3%
    NOPATEUR 207.3mEUR 239.0mEUR 275.4mEUR 317.4mEUR 365.8m+15.3%
    Add depreciation & amortisationEUR 208.2mEUR 240.0mEUR 276.6mEUR 318.8mEUR 367.4m+15.3%
    Less capital expenditureEUR -126.1mEUR -145.4mEUR -167.5mEUR -193.1mEUR -222.5m+15.3%
    Less increase in working capitalEUR -80.1mEUR -92.3mEUR -106.4mEUR -122.6mEUR -141.3m+15.3%
    Free cashflow to firmEUR 209.3mEUR 241.3mEUR 278.1mEUR 320.5mEUR 369.3m+15.3%
    Discount factor0.95820.87970.80760.74140.6807-
    Present valueEUR 200.6mEUR 212.2mEUR 224.6mEUR 237.6mEUR 251.4m+5.8%
    Present Value Of The ForecastEUR 1.1bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.20%USD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta0.923Reported 0.885, pulled toward 1.0 (Blume)
    Cost of equity10.20%Risk-free + beta x equity risk premium
    Cost of debt4.20%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationEUR 5.4bn81.9% of capital
    Total debtEUR 1.2bn18.1% of capital, book value as a proxy
    Tax rate25.0%Effective, capped at statutory
    WACC8.92%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareEUR 55.53

    76% of EV

    Forecast FCFF, final year
    EUR 369.3m
    Capex at depreciation, working capital in reinvestment
    EUR 378.3m
    Less reinvestment at g/ROIC (11.6% of NOPAT)
    EUR -43.9m
    Capitalised
    EUR 334.4m
    ROIC (reported)
    21.5%
    Terminal value, undiscounted
    EUR 5.3bn
    Terminal value, discounted
    EUR 3.6bn
    Enterprise value
    EUR 4.8bn
    Less net debt
    EUR 983.5m
    Equity value
    EUR 3.8bn

    Exit at 15.0x EBITDA

    Value per shareEUR 130.78

    89% of EV

    Terminal value, undiscounted
    EUR 12.8bn
    Terminal value, discounted
    EUR 8.7bn
    Enterprise value
    EUR 9.9bn
    Less net debt
    EUR 983.5m
    Equity value
    EUR 8.9bn

    Spread between methods: 81%.

    Sensitivity

    Value per share (EUR) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.92%74.6380.3287.2795.97107.19
    7.92%60.5664.1968.4773.6179.89
    8.92%50.2952.7355.5358.8062.65
    9.92%42.4744.1746.0848.2650.77
    10.92%36.3137.5338.8840.3942.09

    Outlined: this model. Green text: above today's price of 79.00. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year15.3%23.8%+8.5pp
    EBIT margin17.0%22.9%+5.9pp
    Discount rate8.9%7.3%-1.6pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.