DCF Studio

    CCEP.L · LSE · Consumer Defensive

    Coca-Cola Europacific Partners PLC

    Also onConsensus Drift

    Implied value per share

    GBp 7487.53

    Market price

    GBp 7495.00

    Implied upside

    -0.1%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · EUR model at 0.8573

    AdjustedReports in EUR, trades in GBp. Modelled in EUR, converted at the end.
    NoteRisk-free rate is an assumption: GBP assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    GBp 7487.53-0.1%
    Exit multiple
    GBp 8311.47+10.9%
    Market price
    GBp 7495.00

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0bn2bn3bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 22.3bnEUR 23.7bnEUR 25.2bnEUR 26.9bnEUR 28.6bn+6.5%
    EBITEUR 2.9bnEUR 3.0bnEUR 3.2bnEUR 3.4bnEUR 3.7bn+6.5%
    NOPATEUR 2.2bnEUR 2.3bnEUR 2.5bnEUR 2.6bnEUR 2.8bn+6.5%
    Add depreciation & amortisationEUR 1.0bnEUR 1.1bnEUR 1.1bnEUR 1.2bnEUR 1.3bn+6.5%
    Less capital expenditureEUR -948.9mEUR -1.0bnEUR -1.1bnEUR -1.1bnEUR -1.2bn+6.5%
    Less increase in working capitalEUR 210.0mEUR 223.6mEUR 238.1mEUR 253.4mEUR 269.8m-6.5%
    Free cashflow to firmEUR 2.4bnEUR 2.6bnEUR 2.8bnEUR 3.0bnEUR 3.1bn+6.5%
    Discount factor0.96700.90430.84570.79090.7396-
    Present valueEUR 2.4bnEUR 2.4bnEUR 2.3bnEUR 2.3bnEUR 2.3bn-0.4%
    Present Value Of The ForecastEUR 11.7bn

    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
    Beta0.648Reported 0.475, pulled toward 1.0 (Blume)
    Cost of equity8.07%Risk-free + beta x equity risk premium
    Cost of debt4.50%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationEUR 33.0bn75.5% of capital
    Total debtEUR 10.7bn24.5% of capital, book value as a proxy
    Tax rate23.6%Effective, capped at statutory
    WACC6.93%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 87.34

    76% of EV

    Forecast FCFF, final year
    EUR 3.1bn
    Capex at depreciation, working capital in reinvestment
    EUR 3.0bn
    Less reinvestment at g/ROIC (25.4% of NOPAT)
    EUR -754.7m
    Capitalised
    EUR 2.2bn
    ROIC (reported)
    9.8%
    Terminal value, undiscounted
    EUR 51.2bn
    Terminal value, discounted
    EUR 37.8bn
    Enterprise value
    EUR 49.6bn
    Less net debt
    EUR 9.7bn
    Equity value
    EUR 39.8bn

    Exit at 11.5x EBITDA

    Value per shareEUR 96.95

    78% of EV

    Terminal value, undiscounted
    EUR 57.1bn
    Terminal value, discounted
    EUR 42.2bn
    Enterprise value
    EUR 53.9bn
    Less net debt
    EUR 9.7bn
    Equity value
    EUR 44.2bn

    Spread between methods: 10%.

    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%
    4.93%136.87150.73170.19199.56249.24
    5.93%102.38108.68116.74127.46142.49
    6.93%80.5583.6387.3491.9397.79
    7.93%65.4866.9868.7070.7373.16
    8.93%54.4555.1055.8256.6257.53

    Outlined: this model. Green text: above today's price of 87.42. 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 year6.5%6.5%+0.0pp
    EBIT margin12.8%12.9%+0.0pp
    Discount rate6.9%6.9%-0.0pp
    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.