DCF Studio

    LNT · NMS · Utilities

    Alliant Energy Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 17.48

    Market price

    USD 65.61

    Implied upside

    -73.4%

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

    Value Per Share

    Perpetuity growth
    USD 17.48-73.4%
    Exit multiple
    USD 57.14-12.9%
    Market price
    USD 65.61

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueUSD 4.4bnUSD 4.5bnUSD 4.5bnUSD 4.6bnUSD 4.6bn+1.2%
    EBITUSD 1.0bnUSD 1.0bnUSD 1.0bnUSD 1.0bnUSD 1.1bn+1.2%
    NOPATUSD 988.7mUSD 1.0bnUSD 1.0bnUSD 1.0bnUSD 1.0bn+1.2%
    Add depreciation & amortisationUSD 789.6mUSD 799.3mUSD 809.2mUSD 819.1mUSD 829.2m+1.2%
    Less capital expenditureUSD -632.2mUSD -640.0mUSD -647.9mUSD -655.8mUSD -663.9m+1.2%
    Less increase in working capitalUSD 53.6mUSD 54.3mUSD 55.0mUSD 55.6mUSD 56.3m-1.2%
    Free cashflow to firmUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.2bnUSD 1.3bn+1.2%
    Discount factor0.96600.90140.84110.78490.7324-
    Present valueUSD 1.2bnUSD 1.1bnUSD 1.0bnUSD 976.8mUSD 922.7m-5.5%
    Present Value Of The ForecastUSD 5.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate5.00%US 10-year Treasury (^TNX)
    Equity risk premium5.50%Market assumption
    Beta0.686Reported 0.532, pulled toward 1.0 (Blume)
    Cost of equity8.77%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 17.0bn58.4% of capital
    Total debtUSD 12.1bn41.6% of capital, book value as a proxy
    Tax rate1.8%Effective, capped at statutory
    WACC7.16%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 17.48

    68% of EV

    Forecast FCFF, final year
    USD 1.3bn
    Capex at depreciation, working capital in reinvestment
    USD 1.0bn
    Less reinvestment at g/ROIC (34.9% of NOPAT)
    USD -362.3m
    Capitalised
    USD 676.0m
    ROIC (WACC floor)
    7.2%
    Terminal value, undiscounted
    USD 14.9bn
    Terminal value, discounted
    USD 10.9bn
    Enterprise value
    USD 16.1bn
    Less net debt
    USD 11.6bn
    Equity value
    USD 4.5bn

    Exit at 15.3x EBITDA

    Value per shareUSD 57.14

    80% of EV

    Terminal value, undiscounted
    USD 28.8bn
    Terminal value, discounted
    USD 21.1bn
    Enterprise value
    USD 26.3bn
    Less net debt
    USD 11.6bn
    Equity value
    USD 14.7bn

    Spread between methods: 106%.

    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%
    5.16%40.5741.5742.8444.5647.13
    6.16%26.4026.6526.9027.1427.39
    7.16%17.0717.2717.4817.6917.89
    8.16%10.0110.1810.3610.5310.70
    9.16%4.484.634.774.925.07

    Outlined: this model. Green text: above today's price of 65.61. 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 year1.2%12.8%+11.5pp
    EBIT margin22.8%41.5%+18.7pp
    Discount rate7.2%4.5%-2.6pp
    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.