DCF Studio

    CBOE · BTS · Financial Services

    Cboe Global Markets, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 224.92

    Market price

    USD 272.86

    Implied upside

    -17.6%

    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.

    Value Per Share

    Perpetuity growth
    USD 224.92-17.6%
    Exit multiple
    USD 294.27+7.8%
    Market price
    USD 272.86

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueUSD 5.0bnUSD 5.3bnUSD 5.6bnUSD 6.0bnUSD 6.3bn+6.0%
    EBITUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.8bn+6.0%
    NOPATUSD 1.1bnUSD 1.2bnUSD 1.3bnUSD 1.3bnUSD 1.4bn+6.0%
    Add depreciation & amortisationUSD 178.0mUSD 188.6mUSD 199.9mUSD 211.9mUSD 224.6m+6.0%
    Less capital expenditureUSD -71.2mUSD -75.4mUSD -80.0mUSD -84.7mUSD -89.8m+6.0%
    Less increase in working capitalUSD 85.5mUSD 90.6mUSD 96.1mUSD 101.8mUSD 107.9m-6.0%
    Free cashflow to firmUSD 1.3bnUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.7bn+6.0%
    Discount factor0.96190.88990.82330.76180.7048-
    Present valueUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bn-1.9%
    Present Value Of The ForecastUSD 6.1bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate5.00%US 10-year Treasury (^TNX)
    Equity risk premium5.50%Market assumption
    Beta0.603Reported 0.408, pulled toward 1.0 (Blume)
    Cost of equity8.32%Risk-free + beta x equity risk premium
    Cost of debt5.00%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationUSD 28.5bn94.7% of capital
    Total debtUSD 1.6bn5.3% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.09%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 224.92

    74% of EV

    Forecast FCFF, final year
    USD 1.7bn
    Capex at depreciation, working capital in reinvestment
    USD 1.5bn
    Less reinvestment at g/ROIC (15.7% of NOPAT)
    USD -243.5m
    Capitalised
    USD 1.3bn
    ROIC (reported)
    15.9%
    Terminal value, undiscounted
    USD 24.0bn
    Terminal value, discounted
    USD 16.9bn
    Enterprise value
    USD 23.0bn
    Less net debt
    USD -661.9m
    Equity value
    USD 23.6bn

    Exit at 17.0x EBITDA

    Value per shareUSD 294.27

    80% of EV

    Terminal value, undiscounted
    USD 34.3bn
    Terminal value, discounted
    USD 24.2bn
    Enterprise value
    USD 30.3bn
    Less net debt
    USD -661.9m
    Equity value
    USD 30.9bn

    Spread between methods: 27%.

    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%
    6.09%293.54313.66339.29373.11419.88
    7.09%243.87255.54269.69287.21309.52
    8.09%209.25216.47224.92234.97247.14
    9.09%183.72188.37193.68199.82206.99
    10.09%164.10167.18170.63174.51178.95

    Outlined: this model. Green text: above today's price of 272.86. 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 year6.0%10.5%+4.5pp
    EBIT margin28.4%35.4%+6.9pp
    Discount rate8.1%7.0%-1.1pp
    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.