DCF Studio

    XYZ · NYQ · Technology

    Block, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 21.99

    Market price

    USD 77.08

    Implied upside

    -71.5%

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

    AdjustedReported capital expenditure averages just 0.74% of revenue, which is too low to be the company's real investment - property trusts and similar structures invest through lines that are not reported as capex. Capex has been set to 1.72% of revenue so the forecast is not handed free growth. The accounts do not separate depreciation from amortisation, so the combined charge is used - if a large part of it is amortisation of an acquisition, the reported capex is probably right and this substitution is not. Override it if the reported figure is right.

    Value Per Share

    Perpetuity growth
    USD 21.99-71.5%
    Exit multiple
    USD 35.75-53.6%
    Market price
    USD 77.08

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn1bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 26.1bnUSD 29.1bnUSD 32.1bnUSD 35.0bnUSD 37.8bnUSD 40.4bnUSD 42.8bnUSD 44.8bnUSD 46.4bnUSD 47.6bn+6.9%
    EBITUSD 1.4bnUSD 1.5bnUSD 1.7bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.3bnUSD 2.4bnUSD 2.5bnUSD 2.5bn+6.9%
    NOPATUSD 1.1bnUSD 1.2bnUSD 1.3bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 1.9bnUSD 2.0bn+6.9%
    Add depreciation & amortisationUSD 450.2mUSD 501.3mUSD 552.6mUSD 603.0mUSD 651.4mUSD 696.5mUSD 737.1mUSD 771.8mUSD 799.6mUSD 819.6m+6.9%
    Less capital expenditureUSD -450.2mUSD -528.9mUSD -613.5mUSD -702.7mUSD -795.0mUSD -888.4mUSD -980.7mUSD -1.1bnUSD -1.2bnUSD -1.2bn+11.8%
    Capex, % of revenue1.7%1.8%1.9%2.0%2.1%2.2%2.3%2.4%2.5%2.6%-
    Less increase in working capitalUSD -390.3mUSD -599.4mUSD -602.3mUSD -592.3mUSD -568.2mUSD -529.3mUSD -475.5mUSD -407.5mUSD -326.6mUSD -234.6m-5.5%
    Free cashflow to firmUSD 701.8mUSD 589.0mUSD 677.2mUSD 770.9mUSD 868.6mUSD 968.6mUSD 1.1bnUSD 1.2bnUSD 1.3bnUSD 1.3bn+7.5%
    Discount factor0.94390.84110.74940.66780.59500.53020.47240.42090.37510.3342-
    Present valueUSD 662.5mUSD 495.4mUSD 507.5mUSD 514.8mUSD 516.8mUSD 513.5mUSD 504.9mUSD 491.2mUSD 472.8mUSD 450.2m-
    Present Value Of The ForecastUSD 5.1bn

    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
    Beta2.045Reported 2.559, pulled toward 1.0 (Blume)
    Cost of equity13.54%Risk-free + beta x equity risk premium
    Cost of debt6.89%Assumed: risk-free + 200bp (interest expense not reported)
    Market capitalisationUSD 46.3bn83.8% of capital
    Total debtUSD 9.0bn16.2% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC12.23%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 21.99

    52% of EV

    Forecast FCFF, final year
    USD 1.3bn
    Capex at depreciation, working capital in reinvestment
    USD 2.0bn
    Less reinvestment at g/ROIC (20.4% of NOPAT)
    USD -406.5m
    Capitalised
    USD 1.6bn
    ROIC (WACC floor)
    12.2%
    Terminal value, undiscounted
    USD 16.7bn
    Terminal value, discounted
    USD 5.6bn
    Enterprise value
    USD 10.7bn
    Less net debt
    USD -3.0bn
    Equity value
    USD 13.7bn

    Exit at 12.7x EBITDA

    Value per shareUSD 35.75

    73% of EV

    Terminal value, undiscounted
    USD 42.3bn
    Terminal value, discounted
    USD 14.1bn
    Enterprise value
    USD 19.3bn
    Less net debt
    USD -3.0bn
    Equity value
    USD 22.3bn

    Spread between methods: 48%.

    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%
    10.23%26.7826.4926.1925.8925.59
    11.23%24.4024.1423.8923.6323.38
    12.23%22.4422.2121.9921.7721.54
    13.23%20.7920.6020.4020.2120.01
    14.23%19.4019.2319.0618.8818.71

    Outlined: this model. Green text: above today's price of 77.08. 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 year11.3%7.0%33.2%
    EBIT margin12.6%5.3%18.6%
    Discount rate-12.2%4.1%
    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.