DCF Studio

    LVS · NYQ · Consumer Cyclical

    Las Vegas Sands Corp.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 168.88

    Market price

    USD 39.98

    Implied upside

    +322.4%

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

    Value Per Share

    Perpetuity growth
    USD 168.88+322.4%
    Exit multiple
    USD 228.87+472.5%
    Market price
    USD 39.98

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn6bn12bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30CAGR
    RevenueUSD 19.1bnUSD 28.1bnUSD 41.2bnUSD 60.5bnUSD 88.9bn+46.9%
    EBITUSD 2.4bnUSD 3.5bnUSD 5.1bnUSD 7.5bnUSD 11.0bn+46.9%
    NOPATUSD 2.0bnUSD 2.9bnUSD 4.3bnUSD 6.3bnUSD 9.3bn+46.9%
    Add depreciation & amortisationUSD 3.0bnUSD 4.4bnUSD 6.5bnUSD 9.5bnUSD 13.9bn+46.9%
    Less capital expenditureUSD -2.6bnUSD -3.8bnUSD -5.6bnUSD -8.3bnUSD -12.1bn+46.9%
    Less increase in working capitalUSD 125.1mUSD 183.8mUSD 269.9mUSD 396.4mUSD 582.1m-46.9%
    Free cashflow to firmUSD 2.5bnUSD 3.7bnUSD 5.4bnUSD 7.9bnUSD 11.7bn+46.9%
    Discount factor0.96350.89440.83030.77080.7156-
    Present valueUSD 2.4bnUSD 3.3bnUSD 4.5bnUSD 6.1bnUSD 8.3bn+36.3%
    Present Value Of The ForecastUSD 24.7bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate5.00%US 10-year Treasury (^TNX)
    Equity risk premium5.50%Market assumption
    Beta0.879Reported 0.819, pulled toward 1.0 (Blume)
    Cost of equity9.83%Risk-free + beta x equity risk premium
    Cost of debt5.05%Interest expense / average total debt
    Market capitalisationUSD 25.9bn62.1% of capital
    Total debtUSD 15.8bn37.9% of capital, book value as a proxy
    Tax rate15.7%Effective, capped at statutory
    WACC7.72%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 168.88

    81% of EV

    Forecast FCFF, final year
    USD 11.7bn
    Capex at depreciation, working capital in reinvestment
    USD 9.3bn
    Less reinvestment at g/ROIC (20.0% of NOPAT)
    USD -1.9bn
    Capitalised
    USD 7.4bn
    ROIC (reported)
    12.5%
    Terminal value, undiscounted
    USD 145.8bn
    Terminal value, discounted
    USD 104.3bn
    Enterprise value
    USD 129.0bn
    Less net debt
    USD 11.9bn
    Equity value
    USD 117.0bn

    Exit at 8.2x EBITDA

    Value per shareUSD 228.87

    86% of EV

    Terminal value, undiscounted
    USD 203.9bn
    Terminal value, discounted
    USD 145.9bn
    Enterprise value
    USD 170.6bn
    Less net debt
    USD 11.9bn
    Equity value
    USD 158.6bn

    Spread between methods: 30%.

    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%
    5.72%241.15260.60285.96320.48370.37
    6.72%190.39200.80213.57229.67250.64
    7.72%155.96161.89168.88177.27187.56
    8.72%131.07134.55138.53143.15148.57
    9.72%112.25114.29116.58119.15122.07

    Outlined: this model. Green text: above today's price of 39.98. 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 year46.9%14.0%-32.8pp
    EBIT margin12.4%3.5%-8.9pp
    Discount rate7.7%19.6%+11.9pp
    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.