DCF Studio

    UAL · NMS · Industrials

    United Airlines Holdings, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 149.95

    Market price

    USD 109.24

    Implied upside

    +37.3%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedCapital expenditure runs at 11.0% of revenue against depreciation of 5.1%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 149.95+37.3%
    Exit multiple
    USD 138.50+26.8%
    Market price
    USD 109.24

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn3bn5bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 68.7bnUSD 73.5bnUSD 78.3bnUSD 83.0bnUSD 87.4bnUSD 91.6bnUSD 95.5bnUSD 99.0bnUSD 102.0bnUSD 104.5bn+4.8%
    EBITUSD 5.6bnUSD 6.0bnUSD 6.4bnUSD 6.8bnUSD 7.1bnUSD 7.5bnUSD 7.8bnUSD 8.1bnUSD 8.3bnUSD 8.5bn+4.8%
    NOPATUSD 4.4bnUSD 4.7bnUSD 5.1bnUSD 5.4bnUSD 5.6bnUSD 5.9bnUSD 6.2bnUSD 6.4bnUSD 6.6bnUSD 6.7bn+4.8%
    Add depreciation & amortisationUSD 3.5bnUSD 3.8bnUSD 4.0bnUSD 4.3bnUSD 4.5bnUSD 4.7bnUSD 4.9bnUSD 5.1bnUSD 5.2bnUSD 5.4bn+4.8%
    Less capital expenditureUSD -7.5bnUSD -7.7bnUSD -7.9bnUSD -7.9bnUSD -8.0bnUSD -7.9bnUSD -7.8bnUSD -7.6bnUSD -7.4bnUSD -7.1bn-0.7%
    Capex, % of revenue11.0%10.5%10.0%9.6%9.1%8.6%8.2%7.7%7.2%6.8%-
    Less increase in working capitalUSD 88.9mUSD 45.0mUSD 44.3mUSD 43.1mUSD 41.2mUSD 38.8mUSD 35.8mUSD 32.2mUSD 28.2mUSD 23.6m+13.7%
    Free cashflow to firmUSD 516.4mUSD 845.2mUSD 1.3bnUSD 1.7bnUSD 2.2bnUSD 2.7bnUSD 3.3bnUSD 3.9bnUSD 4.5bnUSD 5.1bn+28.9%
    Discount factor0.96440.89700.83440.77610.72180.67140.62450.58090.54030.5025-
    Present valueUSD 498.0mUSD 758.2mUSD 1.1bnUSD 1.3bnUSD 1.6bnUSD 1.8bnUSD 2.1bnUSD 2.2bnUSD 2.4bnUSD 2.5bn-
    Present Value Of The ForecastUSD 16.3bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.245Reported 1.366, pulled toward 1.0 (Blume)
    Cost of equity10.16%Risk-free + beta x equity risk premium
    Cost of debt5.67%Risk-free + 78bp, the spread for a A rating at 4.3x interest cover. Book interest / average debt was lower, at 3.6%.
    Market capitalisationUSD 35.5bn53.3% of capital
    Total debtUSD 31.0bn46.7% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC7.51%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 149.95

    76% of EV

    Forecast FCFF, final year
    USD 5.1bn
    Capex at depreciation, working capital in reinvestment
    USD 6.7bn
    Less reinvestment at g/ROIC (25.4% of NOPAT)
    USD -1.7bn
    Capitalised
    USD 5.0bn
    ROIC (reported)
    9.9%
    Terminal value, undiscounted
    USD 102.9bn
    Terminal value, discounted
    USD 51.7bn
    Enterprise value
    USD 68.1bn
    Less net debt
    USD 18.8bn
    Equity value
    USD 49.3bn

    Exit at 6.9x EBITDA

    Value per shareUSD 138.50

    75% of EV

    Terminal value, undiscounted
    USD 95.4bn
    Terminal value, discounted
    USD 48.0bn
    Enterprise value
    USD 64.3bn
    Less net debt
    USD 18.8bn
    Equity value
    USD 45.5bn

    Spread between methods: 8%.

    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%
    5.51%269.74287.40311.82347.01401.02
    6.51%195.22201.70210.42222.34239.05
    7.51%145.98147.57149.95153.39158.28
    8.51%111.17110.44109.97109.82110.08
    9.51%85.3683.5081.6879.9078.18

    Outlined: this model. Green text: above today's price of 109.24. 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.

    InputActualModelImplied
    Revenue growth, a year9.5%5.9%3.5%
    EBIT margin9.6%8.2%6.9%
    Discount rate-7.5%8.5%
    Download as Excel

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    Yahoo Finance and RBA data. General information, not advice. Methodology.