DCF Studio

    UCG.MI · MIL · Financial Services

    UniCredit S.p.A.

    Also onConsensus Drift

    Implied value per share

    EUR 31.48

    Market price

    EUR 81.13

    Implied upside

    -61.2%

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

    Wrong toolThis is a financial. Banks and insurers report no meaningful operating income, and capex and working capital do not mean what a free-cashflow model assumes, so a DCF will misprice it. The model below runs on best-effort numbers - treat it as an illustration, not a valuation.
    NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    EUR 31.48-61.2%
    Exit multiple
    EUR 71.65-11.7%
    Market price
    EUR 81.13

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0bn5bn11bnFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 26.5bnEUR 28.1bnEUR 29.8bnEUR 31.6bnEUR 33.5bn+6.0%
    EBITEUR 12.1bnEUR 12.8bnEUR 13.6bnEUR 14.4bnEUR 15.3bn+6.0%
    NOPATEUR 9.9bnEUR 10.5bnEUR 11.2bnEUR 11.8bnEUR 12.5bn+6.0%
    Add depreciation & amortisationEUR 1.5bnEUR 1.6bnEUR 1.7bnEUR 1.8bnEUR 1.9bn+6.0%
    Less capital expenditureEUR -1.4bnEUR -1.5bnEUR -1.6bnEUR -1.7bnEUR -1.8bn+6.0%
    Less increase in working capitalEUR -1.5bnEUR -1.6bnEUR -1.7bnEUR -1.8bnEUR -1.9bn+6.0%
    Free cashflow to firmEUR 8.5bnEUR 9.0bnEUR 9.5bnEUR 10.1bnEUR 10.7bn+6.0%
    Discount factor0.95520.87150.79520.72550.6620-
    Present valueEUR 8.1bnEUR 7.8bnEUR 7.6bnEUR 7.3bnEUR 7.1bn-3.3%
    Present Value Of The ForecastEUR 38.0bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.20%USD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta1.040Reported 1.059, pulled toward 1.0 (Blume)
    Cost of equity10.96%Risk-free + beta x equity risk premium
    Cost of debt10.14%Interest expense / average total debt
    Market capitalisationEUR 122.3bn48.5% of capital
    Total debtEUR 129.9bn51.5% of capital, book value as a proxy
    Tax rate17.9%Effective, capped at statutory
    WACC9.60%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 shareEUR 31.48

    70% of EV

    Forecast FCFF, final year
    EUR 10.7bn
    Capex at depreciation, working capital in reinvestment
    EUR 12.5bn
    Less reinvestment at g/ROIC (26.0% of NOPAT)
    EUR -3.3bn
    Capitalised
    EUR 9.3bn
    ROIC (WACC floor)
    9.6%
    Terminal value, undiscounted
    EUR 133.7bn
    Terminal value, discounted
    EUR 88.5bn
    Enterprise value
    EUR 126.5bn
    Less net debt
    EUR 76.6bn
    Equity value
    EUR 49.9bn

    Exit at 13.4x EBITDA

    Value per shareEUR 71.65

    80% of EV

    Terminal value, undiscounted
    EUR 229.9bn
    Terminal value, discounted
    EUR 152.2bn
    Enterprise value
    EUR 190.2bn
    Less net debt
    EUR 76.6bn
    Equity value
    EUR 113.5bn

    Spread between methods: 78%.

    Sensitivity

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

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    7.60%52.6553.0253.3953.7754.14
    8.60%40.5140.8341.1541.4741.78
    9.60%30.9431.2131.4831.7532.03
    10.60%23.1923.4223.6623.9024.13
    11.60%16.7917.0017.2117.4117.62

    Outlined: this model. Green text: above today's price of 81.13. 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 year6.0%20.6%+14.6pp
    EBIT margin45.6%72.6%+27.0pp
    Discount rate9.6%6.0%-3.6pp
    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.