DCF Studio

    BKT.MC · MCE · Financial Services

    Bankinter, S.A.

    Also onConsensus Drift

    Implied value per share

    EUR 40.16

    Market price

    EUR 16.48

    Implied upside

    +143.6%

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

    Wrong toolThis is a financial. Banks and insurers report no meaningful operating income, and capex and working capital do not mean what a free-cashflow model assumes, so a DCF will misprice it. The model below runs on best-effort numbers - treat it as an illustration, not a valuation.
    AdjustedCapital expenditure runs at 4.1% of revenue against depreciation of 3.0%. A perpetuity has to be a steady state, so the terminal year uses maintenance capex at depreciation and then charges the reinvestment terminal growth requires (g/ROIC of NOPAT). The bridge is shown under Terminal Value.
    NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    EUR 40.16+143.6%
    Exit multiple
    EUR 22.46+36.2%
    Market price
    EUR 16.48

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 3.5bnEUR 3.9bnEUR 4.3bnEUR 4.8bnEUR 5.4bn+11.4%
    EBITEUR 1.5bnEUR 1.7bnEUR 1.8bnEUR 2.0bnEUR 2.3bn+11.4%
    NOPATEUR 1.1bnEUR 1.2bnEUR 1.4bnEUR 1.5bnEUR 1.7bn+11.4%
    Add depreciation & amortisationEUR 105.3mEUR 117.3mEUR 130.7mEUR 145.6mEUR 162.2m+11.4%
    Less capital expenditureEUR -144.3mEUR -160.8mEUR -179.1mEUR -199.5mEUR -222.3m+11.4%
    Less increase in working capitalEUR -357.0mEUR -397.7mEUR -443.1mEUR -493.7mEUR -550.0m+11.4%
    Free cashflow to firmEUR 715.4mEUR 797.0mEUR 887.9mEUR 989.3mEUR 1.1bn+11.4%
    Discount factor0.97270.92020.87060.82370.7792-
    Present valueEUR 695.8mEUR 733.4mEUR 773.0mEUR 814.8mEUR 858.8m+5.4%
    Present Value Of The ForecastEUR 3.9bn

    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
    Beta0.361Reported 0.046, pulled toward 1.0 (Blume)
    Cost of equity6.55%Risk-free + beta x equity risk premium
    Cost of debt6.20%Implied cost of debt of 15.0% is not a credible funding cost, so risk-free + 2bp is assumed instead. Interest expense and reported debt are measuring different things - common for banks, whose interest expense includes deposits that total debt excludes.
    Market capitalisationEUR 14.8bn55.4% of capital
    Total debtEUR 11.9bn44.6% of capital, book value as a proxy
    Tax rate25.0%Effective, capped at statutory
    WACC5.70%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 40.16

    87% of EV

    Forecast FCFF, final year
    EUR 1.1bn
    Capex at depreciation, working capital in reinvestment
    EUR 1.7bn
    Less reinvestment at g/ROIC (40.0% of NOPAT)
    EUR -696.3m
    Capitalised
    EUR 1.0bn
    ROIC (reported)
    6.3%
    Terminal value, undiscounted
    EUR 33.5bn
    Terminal value, discounted
    EUR 26.1bn
    Enterprise value
    EUR 30.0bn
    Less net debt
    EUR -6.1bn
    Equity value
    EUR 36.1bn

    Exit at 5.3x EBITDA

    Value per shareEUR 22.46

    72% of EV

    Terminal value, undiscounted
    EUR 13.1bn
    Terminal value, discounted
    EUR 10.2bn
    Enterprise value
    EUR 14.1bn
    Less net debt
    EUR -6.1bn
    Equity value
    EUR 20.2bn

    Spread between methods: 57%.

    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%
    3.70%69.0678.5195.73137.37387.10
    4.70%49.2451.7355.3160.9271.09
    5.70%38.8739.4440.1641.1042.41
    6.70%32.9533.0633.1733.2833.38
    7.70%29.2229.3129.4029.4929.58

    Outlined: this model. Green text: above today's price of 16.48. 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 year11.4%-21.6%-33.0pp
    EBIT margin42.5%14.0%-28.6pp
    Discount rate5.7%16.2%+10.5pp
    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.