DCF Studio

    BLDR · NYQ · Industrials

    Builders FirstSource, Inc.

    Also onConsensus Drift

    Implied value per share

    USD 121.17

    Market price

    USD 67.82

    Implied upside

    +78.7%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 121.17+78.7%
    Exit multiple
    USD 112.78+66.3%
    Market price
    USD 67.82

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 14.4bnUSD 14.1bnUSD 13.9bnUSD 13.8bnUSD 13.7bnUSD 13.8bnUSD 13.9bnUSD 14.1bnUSD 14.3bnUSD 14.7bn+0.2%
    EBITUSD 1.6bnUSD 1.6bnUSD 1.5bnUSD 1.5bnUSD 1.5bnUSD 1.5bnUSD 1.5bnUSD 1.6bnUSD 1.6bnUSD 1.6bn+0.2%
    NOPATUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bn+0.2%
    Add depreciation & amortisationUSD 458.8mUSD 449.6mUSD 443.2mUSD 439.3mUSD 438.0mUSD 439.1mUSD 442.6mUSD 448.7mUSD 457.4mUSD 468.9m+0.2%
    Less capital expenditureUSD -322.9mUSD -349.5mUSD -377.0mUSD -406.0mUSD -436.9mUSD -470.3mUSD -506.6mUSD -546.5mUSD -590.7mUSD -639.9m+7.9%
    Capex, % of revenue2.2%2.5%2.7%3.0%3.2%3.4%3.7%3.9%4.1%4.4%-
    Less increase in working capitalUSD 76.8mUSD 26.8mUSD 18.9mUSD 11.3mUSD 4.0mUSD -3.2mUSD -10.5mUSD -17.8mUSD -25.4mUSD -33.4m-
    Free cashflow to firmUSD 1.5bnUSD 1.4bnUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.1bnUSD 1.1bnUSD 1.1bnUSD 1.1bn-3.4%
    Discount factor0.96200.89030.82390.76250.70570.65310.60440.55940.51770.4791-
    Present valueUSD 1.4bnUSD 1.2bnUSD 1.1bnUSD 950.3mUSD 848.9mUSD 761.8mUSD 686.7mUSD 621.8mUSD 565.5mUSD 516.4m-
    Present Value Of The ForecastUSD 8.6bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.294Reported 1.439, pulled toward 1.0 (Blume)
    Cost of equity10.37%Risk-free + beta x equity risk premium
    Cost of debt6.00%Risk-free + 111bp, the spread for a BBB rating at 2.9x interest cover. Book interest / average debt was lower, at 5.8%.
    Market capitalisationUSD 7.3bn58.9% of capital
    Total debtUSD 5.1bn41.1% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.05%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 shareUSD 121.17

    53% of EV

    Forecast FCFF, final year
    USD 1.1bn
    Capex at depreciation, working capital in reinvestment
    USD 1.3bn
    Less reinvestment at g/ROIC (13.3% of NOPAT)
    USD -171.1m
    Capitalised
    USD 1.1bn
    ROIC (reported)
    18.7%
    Terminal value, undiscounted
    USD 20.5bn
    Terminal value, discounted
    USD 9.8bn
    Enterprise value
    USD 18.5bn
    Less net debt
    USD 4.9bn
    Equity value
    USD 13.5bn

    Exit at 8.9x EBITDA

    Value per shareUSD 112.78

    51% of EV

    Terminal value, undiscounted
    USD 18.6bn
    Terminal value, discounted
    USD 8.9bn
    Enterprise value
    USD 17.5bn
    Less net debt
    USD 4.9bn
    Equity value
    USD 12.6bn

    Spread between methods: 7%.

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.05%176.07188.02203.55224.44253.82
    7.05%139.09145.45153.39163.47176.60
    8.05%113.33116.86121.17126.47133.09
    9.05%94.3496.3198.68101.57105.10
    10.05%79.7480.8082.0783.6385.52

    Outlined: this model. Green text: above today's price of 67.82. 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.

    InputActualModelImplied
    Revenue growth, a year-12.6%-0.3%-5.4%
    EBIT margin16.6%11.1%7.4%
    Discount rate-8.1%11.2%
    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.