DCF Studio

    CCC.L · LSE · Technology

    Computacenter plc

    Also onConsensus Drift

    Implied value per share

    GBp 7069.14

    Market price

    GBp 5430.00

    Implied upside

    +30.2%

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

    AdjustedReported capital expenditure averages just 0.47% of revenue, which is too low to be the company's real investment - property trusts and similar structures invest through lines that are not reported as capex. Capex has been set to 1.00% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.
    NoteRisk-free rate is an assumption: GBP assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    GBp 7069.14+30.2%
    Exit multiple
    GBp 10616.39+95.5%
    Market price
    GBp 5430.00

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (GBP). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayGBP
    LineFY26FY27FY28FY29FY30CAGR
    RevenueGBP 10.3bnGBP 11.6bnGBP 13.1bnGBP 14.7bnGBP 16.5bn+12.4%
    EBITGBP 361.7mGBP 406.6mGBP 457.1mGBP 513.9mGBP 577.7m+12.4%
    NOPATGBP 271.2mGBP 304.9mGBP 342.8mGBP 385.4mGBP 433.3m+12.4%
    Add depreciation & amortisationGBP 121.2mGBP 136.3mGBP 153.2mGBP 172.2mGBP 193.6m+12.4%
    Less capital expenditureGBP -103.4mGBP -116.2mGBP -130.6mGBP -146.9mGBP -165.1m+12.4%
    Less increase in working capitalGBP 343.2mGBP 385.8mGBP 433.7mGBP 487.6mGBP 548.2m-12.4%
    Free cashflow to firmGBP 632.3mGBP 710.8mGBP 799.1mGBP 898.4mGBP 1.0bn+12.4%
    Discount factor0.95480.87030.79340.72320.6593-
    Present valueGBP 603.7mGBP 618.6mGBP 634.0mGBP 649.7mGBP 665.9m+2.5%
    Present Value Of The ForecastGBP 3.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.50%GBP assumption - no free live source available for this market (assumption)
    Equity risk premium5.50%Market assumption
    Beta0.968Reported 0.952, pulled toward 1.0 (Blume)
    Cost of equity9.82%Risk-free + beta x equity risk premium
    Cost of debt8.31%Interest expense / average total debt
    Market capitalisationGBP 5.7bn96.6% of capital
    Total debtGBP 202.3m3.4% of capital, book value as a proxy
    Tax rate25.0%Effective, capped at statutory
    WACC9.70%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 shareGBP 70.69

    55% of EV

    Forecast FCFF, final year
    GBP 1.0bn
    Capex at depreciation, working capital in reinvestment
    GBP 465.9m
    Less reinvestment at g/ROIC (11.6% of NOPAT)
    GBP -53.9m
    Capitalised
    GBP 412.0m
    ROIC (reported)
    21.6%
    Terminal value, undiscounted
    GBP 5.9bn
    Terminal value, discounted
    GBP 3.9bn
    Enterprise value
    GBP 7.0bn
    Less net debt
    GBP -426.2m
    Equity value
    GBP 7.5bn

    Exit at 15.0x EBITDA

    Value per shareGBP 106.16

    71% of EV

    Terminal value, undiscounted
    GBP 11.5bn
    Terminal value, discounted
    GBP 7.6bn
    Enterprise value
    GBP 10.8bn
    Less net debt
    GBP -426.2m
    Equity value
    GBP 11.2bn

    Spread between methods: 40%.

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    7.70%83.6686.8490.6195.16100.78
    8.70%74.5576.6679.1081.9585.34
    9.70%67.5869.0470.6972.5874.77
    10.70%62.0663.1064.2665.5667.03
    11.70%57.5658.3259.1560.0761.10

    Outlined: this model. Green text: above today's price of 54.30. 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 year12.4%7.5%-4.9pp
    EBIT margin3.5%2.3%-1.2pp
    Discount rate9.7%12.9%+3.2pp
    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.