DCF Studio

    URW.PA · PAR · Real Estate

    Unibail-Rodamco-Westfield SE

    Also onConsensus Drift

    Implied value per share

    EUR 11.15

    Market price

    EUR 93.12

    Implied upside

    -88.0%

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

    AdjustedCapital expenditure runs at 34.5% of revenue against depreciation of 1.7%. A perpetuity has to be a steady state, so the terminal year uses maintenance capex at depreciation and then charges the reinvestment terminal growth requires (g/ROIC of NOPAT). The bridge is shown under Terminal Value.
    NoteRisk-free rate is an assumption: EUR assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    EUR 11.15-88.0%
    Exit multiple
    EUR 54.09-41.9%
    Market price
    EUR 93.12

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0m188m376mFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 3.1bnEUR 3.1bnEUR 3.1bnEUR 3.1bnEUR 3.2bn+0.6%
    EBITEUR 1.7bnEUR 1.7bnEUR 1.7bnEUR 1.7bnEUR 1.8bn+0.6%
    NOPATEUR 1.4bnEUR 1.4bnEUR 1.4bnEUR 1.4bnEUR 1.4bn+0.6%
    Add depreciation & amortisationEUR 53.1mEUR 53.5mEUR 53.8mEUR 54.1mEUR 54.4m+0.6%
    Less capital expenditureEUR -1.1bnEUR -1.1bnEUR -1.1bnEUR -1.1bnEUR -1.1bn+0.6%
    Less increase in working capitalEUR -8.8mEUR -8.9mEUR -8.9mEUR -9.0mEUR -9.0m+0.6%
    Free cashflow to firmEUR 367.4mEUR 369.6mEUR 371.8mEUR 374.1mEUR 376.3m+0.6%
    Discount factor0.97280.92060.87110.82440.7801-
    Present valueEUR 357.4mEUR 340.2mEUR 323.9mEUR 308.4mEUR 293.6m-4.8%
    Present Value Of The ForecastEUR 1.6bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate3.20%EUR assumption - no free live source available for this market (assumption)
    Equity risk premium6.00%Market assumption
    Beta1.259Reported 1.386, pulled toward 1.0 (Blume)
    Cost of equity10.75%Risk-free + beta x equity risk premium
    Cost of debt3.30%Interest expense / average total debt
    Market capitalisationEUR 13.5bn37.2% of capital
    Total debtEUR 22.7bn62.8% of capital, book value as a proxy
    Tax rate19.3%Effective, capped at statutory
    WACC5.67%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 11.15

    92% of EV

    Forecast FCFF, final year
    EUR 376.3m
    Capex at depreciation, working capital in reinvestment
    EUR 1.4bn
    Less reinvestment at g/ROIC (44.1% of NOPAT)
    EUR -625.5m
    Capitalised
    EUR 793.9m
    ROIC (WACC floor)
    5.7%
    Terminal value, undiscounted
    EUR 25.6bn
    Terminal value, discounted
    EUR 20.0bn
    Enterprise value
    EUR 21.6bn
    Less net debt
    EUR 20.0bn
    Equity value
    EUR 1.6bn

    Exit at 18.5x EBITDA

    Value per shareEUR 54.09

    94% of EV

    Terminal value, undiscounted
    EUR 33.7bn
    Terminal value, discounted
    EUR 26.3bn
    Enterprise value
    EUR 27.9bn
    Less net debt
    EUR 20.0bn
    Equity value
    EUR 7.9bn

    Spread between methods: 132%.

    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%
    3.67%103.36104.49105.62106.75370.63
    4.67%46.4347.2848.1348.9849.83
    5.67%9.8110.4811.1511.8212.49
    6.67%-15.65-15.10-14.56-14.01-13.46
    7.67%-34.32-33.86-33.40-32.95-32.49

    Outlined: this model. Green text: above today's price of 93.12. 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 year0.6%10.6%+10.0pp
    EBIT margin55.8%81.3%+25.5pp
    Discount rate5.7%3.9%-1.8pp
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    Yahoo Finance and RBA data. General information, not advice. Methodology.