DCF Studio

    CNU.NZ · NZE · Communication Services

    Chorus Limited

    Also onConsensus Drift

    Implied value per share

    NZD -0.40

    Market price

    NZD 8.51

    Implied upside

    -104.7%

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

    AdjustedSome line items were not reported and have been derived. Each one is labelled in the workings below.
    NoteRisk-free rate is an assumption: NZD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    NZD -0.40-104.7%
    Exit multiple
    NZD 7.29-14.3%
    Market price
    NZD 8.51

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (NZD). Outflows negative.

    0m109m217mFY27FY28FY29FY30FY31
    Nominal FCFFDiscounted to todayNZD
    LineFY27FY28FY29FY30FY31CAGR
    RevenueNZD 1.0bnNZD 1.1bnNZD 1.1bnNZD 1.1bnNZD 1.1bn+1.6%
    EBITNZD 245.1mNZD 249.2mNZD 253.2mNZD 257.4mNZD 261.6m+1.6%
    NOPATNZD 176.5mNZD 179.4mNZD 182.3mNZD 185.3mNZD 188.4m+1.6%
    Add depreciation & amortisationNZD 476.3mNZD 484.1mNZD 492.0mNZD 500.1mNZD 508.3m+1.6%
    Less capital expenditureNZD -450.8mNZD -458.2mNZD -465.7mNZD -473.3mNZD -481.1m+1.6%
    Less increase in working capitalNZD 1.5mNZD 1.5mNZD 1.5mNZD 1.6mNZD 1.6m-1.6%
    Free cashflow to firmNZD 203.5mNZD 206.8mNZD 210.2mNZD 213.6mNZD 217.1m+1.6%
    Discount factor0.96850.90850.85220.79940.7498-
    Present valueNZD 197.1mNZD 187.9mNZD 179.1mNZD 170.8mNZD 162.8m-4.7%
    Present Value Of The ForecastNZD 897.7m

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.50%NZD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta0.599Reported 0.401, pulled toward 1.0 (Blume)
    Cost of equity8.39%Risk-free + beta x equity risk premium
    Cost of debt6.54%Interest expense / average total debt
    Market capitalisationNZD 3.7bn51.6% of capital
    Total debtNZD 3.5bn48.4% of capital, book value as a proxy
    Tax rate28.0%Effective, capped at statutory
    WACC6.61%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 shareNZD -0.40

    71% of EV

    Forecast FCFF, final year
    NZD 217.1m
    Capex at depreciation, working capital in reinvestment
    NZD 188.4m
    Less reinvestment at g/ROIC (37.8% of NOPAT)
    NZD -71.3m
    Capitalised
    NZD 117.1m
    ROIC (WACC floor)
    6.6%
    Terminal value, undiscounted
    NZD 2.9bn
    Terminal value, discounted
    NZD 2.2bn
    Enterprise value
    NZD 3.1bn
    Less net debt
    NZD 3.3bn
    Equity value
    NZD -175.4m

    Exit at 9.6x EBITDA

    Value per shareNZD 7.29

    86% of EV

    Terminal value, undiscounted
    NZD 7.4bn
    Terminal value, discounted
    NZD 5.5bn
    Enterprise value
    NZD 6.4bn
    Less net debt
    NZD 3.3bn
    Equity value
    NZD 3.2bn

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.61%2.502.572.652.762.93
    5.61%0.740.770.800.830.86
    6.61%-0.45-0.43-0.40-0.38-0.35
    7.61%-1.33-1.31-1.29-1.27-1.25
    8.61%-2.01-2.00-1.98-1.96-1.94

    Outlined: this model. Green text: above today's price of 8.51. 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 year1.6%21.3%+19.6pp
    EBIT margin23.4%54.0%+30.5pp
    Discount rate6.6%3.8%-2.8pp
    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.