DCF Studio

    CCL-B.TO · TOR · Consumer Cyclical

    CCL Industries Inc.

    Also onConsensus Drift

    Implied value per share

    CAD 102.59

    Market price

    CAD 92.85

    Implied upside

    +10.5%

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

    NoteRisk-free rate is an assumption: CAD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    CAD 102.59+10.5%
    Exit multiple
    CAD 106.78+15.0%
    Market price
    CAD 92.85

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (CAD). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayCAD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueCAD 8.1bnCAD 8.7bnCAD 9.2bnCAD 9.8bnCAD 10.4bn+6.3%
    EBITCAD 1.2bnCAD 1.2bnCAD 1.3bnCAD 1.4bnCAD 1.5bn+6.3%
    NOPATCAD 883.4mCAD 939.0mCAD 998.1mCAD 1.1bnCAD 1.1bn+6.3%
    Add depreciation & amortisationCAD 485.2mCAD 515.7mCAD 548.2mCAD 582.7mCAD 619.3m+6.3%
    Less capital expenditureCAD -531.2mCAD -564.6mCAD -600.1mCAD -637.8mCAD -677.9m+6.3%
    Less increase in working capitalCAD -47.4mCAD -50.4mCAD -53.6mCAD -56.9mCAD -60.5m+6.3%
    Free cashflow to firmCAD 790.1mCAD 839.8mCAD 892.6mCAD 948.8mCAD 1.0bn+6.3%
    Discount factor0.96680.90350.84450.78920.7376-
    Present valueCAD 763.8mCAD 758.8mCAD 753.8mCAD 748.8mCAD 743.9m-0.7%
    Present Value Of The ForecastCAD 3.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate3.30%CAD assumption - no free live source available for this market (assumption)
    Equity risk premium5.50%Market assumption
    Beta0.761Reported 0.644, pulled toward 1.0 (Blume)
    Cost of equity7.49%Risk-free + beta x equity risk premium
    Cost of debt4.72%Interest expense / average total debt
    Market capitalisationCAD 15.7bn87.4% of capital
    Total debtCAD 2.3bn12.6% of capital, book value as a proxy
    Tax rate24.3%Effective, capped at statutory
    WACC7.00%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 shareCAD 102.59

    80% of EV

    Forecast FCFF, final year
    CAD 1.0bn
    Capex at depreciation, working capital in reinvestment
    CAD 1.2bn
    Less reinvestment at g/ROIC (23.6% of NOPAT)
    CAD -284.4m
    Capitalised
    CAD 923.2m
    ROIC (reported)
    10.6%
    Terminal value, undiscounted
    CAD 21.0bn
    Terminal value, discounted
    CAD 15.5bn
    Enterprise value
    CAD 19.3bn
    Less net debt
    CAD 1.3bn
    Equity value
    CAD 18.0bn

    Exit at 10.5x EBITDA

    Value per shareCAD 106.78

    81% of EV

    Terminal value, undiscounted
    CAD 22.0bn
    Terminal value, discounted
    CAD 16.3bn
    Enterprise value
    CAD 20.0bn
    Less net debt
    CAD 1.3bn
    Equity value
    CAD 18.8bn

    Spread between methods: 4%.

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.00%152.87167.77188.54219.59271.21
    6.00%117.26124.30133.28145.17161.73
    7.00%94.6398.23102.59107.97114.83
    8.00%78.9780.8683.0685.6588.76
    9.00%67.5068.4669.5370.7572.14

    Outlined: this model. Green text: above today's price of 92.85. 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 year6.3%4.1%-2.2pp
    EBIT margin14.3%13.0%-1.3pp
    Discount rate7.0%7.4%+0.4pp
    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.