DCF Studio

    CARR · NYQ · Industrials

    Carrier Global Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 26.45

    Market price

    USD 55.17

    Implied upside

    -52.1%

    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 26.45-52.1%
    Exit multiple
    USD 50.12-9.1%
    Market price
    USD 55.17

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn3bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 23.7bnUSD 25.2bnUSD 26.7bnUSD 28.1bnUSD 29.4bnUSD 30.7bnUSD 31.9bnUSD 33.0bnUSD 33.9bnUSD 34.8bn+4.3%
    EBITUSD 2.4bnUSD 2.5bnUSD 2.7bnUSD 2.8bnUSD 2.9bnUSD 3.1bnUSD 3.2bnUSD 3.3bnUSD 3.4bnUSD 3.5bn+4.3%
    NOPATUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.5bnUSD 2.6bnUSD 2.7bnUSD 2.7bn+4.3%
    Add depreciation & amortisationUSD 939.3mUSD 997.4mUSD 1.1bnUSD 1.1bnUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bnUSD 1.3bnUSD 1.4bn+4.3%
    Less capital expenditureUSD -490.3mUSD -582.9mUSD -682.2mUSD -787.4mUSD -898.0mUSD -1.0bnUSD -1.1bnUSD -1.3bnUSD -1.4bnUSD -1.5bn+13.2%
    Capex, % of revenue2.1%2.3%2.6%2.8%3.1%3.3%3.5%3.8%4.0%4.3%-
    Less increase in working capitalUSD -221.4mUSD -163.1mUSD -160.3mUSD -155.9mUSD -149.7mUSD -141.9mUSD -132.3mUSD -121.1mUSD -108.4mUSD -94.2m-9.1%
    Free cashflow to firmUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.4bnUSD 2.4bnUSD 2.5bnUSD 2.5bnUSD 2.5bnUSD 2.5bnUSD 2.5bn+2.1%
    Discount factor0.95830.88000.80810.74210.68150.62590.57470.52780.48470.4451-
    Present valueUSD 2.0bnUSD 2.0bnUSD 1.9bnUSD 1.8bnUSD 1.7bnUSD 1.6bnUSD 1.4bnUSD 1.3bnUSD 1.2bnUSD 1.1bn-
    Present Value Of The ForecastUSD 16.0bn

    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
    Beta1.223Reported 1.333, pulled toward 1.0 (Blume)
    Cost of equity10.07%Risk-free + beta x equity risk premium
    Cost of debt5.78%Risk-free + 89bp, the spread for a A- rating at 4.2x interest cover. Book interest / average debt was lower, at 3.7%.
    Market capitalisationUSD 45.1bn78.7% of capital
    Total debtUSD 12.3bn21.3% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.89%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 26.45

    52% of EV

    Forecast FCFF, final year
    USD 2.5bn
    Capex at depreciation, working capital in reinvestment
    USD 3.4bn
    Less reinvestment at g/ROIC (28.1% of NOPAT)
    USD -959.8m
    Capitalised
    USD 2.5bn
    ROIC (WACC floor)
    8.9%
    Terminal value, undiscounted
    USD 39.4bn
    Terminal value, discounted
    USD 17.5bn
    Enterprise value
    USD 33.5bn
    Less net debt
    USD 10.7bn
    Equity value
    USD 22.8bn

    Exit at 17.6x EBITDA

    Value per shareUSD 50.12

    70% of EV

    Terminal value, undiscounted
    USD 85.2bn
    Terminal value, discounted
    USD 37.9bn
    Enterprise value
    USD 53.9bn
    Less net debt
    USD 10.7bn
    Equity value
    USD 43.2bn

    Spread between methods: 62%.

    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%
    6.89%39.4538.7638.0837.4036.71
    7.89%32.6532.0931.5230.9630.39
    8.89%27.4026.9326.4525.9825.50
    9.89%23.2222.8222.4222.0121.61
    10.89%19.8319.4819.1318.7818.44

    Outlined: this model. Green text: above today's price of 55.17. 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 year7.9%4.8%12.2%
    EBIT margin11.0%10.0%19.0%
    Discount rate-8.9%5.7%
    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.