Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Accenture plc's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 6.4% to 12.1% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 73, DPO 22, DIO 60). At a 9.0% WACC with mid-year discounting, the terminal value (90% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 22.9x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $426.47 per share, suggesting ACN is undervalued by 118.4% at the current price of $195.26.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 11,098 | 11,693 | 12,423 | 13,312 | 14,915 | 15,288 |
| (−) Net Interest | 102 | 107 | 114 | 122 | 137 | 140 |
| (+) D&A | 589 | 615 | 621 | 674 | 742 | 760 |
| EBITDA | 11,789 | 12,415 | 13,158 | 14,108 | 15,794 | 16,189 |
| (−) Tax | 2,607 | 2,746 | 2,918 | 3,126 | 3,503 | — |
| (−) CapEx | 711 | 749 | 796 | 853 | 955 | — |
| (−) ΔWC | 7,767 | 1,074 | 1,320 | 1,606 | 2,899 | — |
| Free Cash Flow (FCF) | 704 | 7,846 | 8,125 | 8,523 | 8,437 | — |
| Peers' EBITDA Multiple | 22.9x | |||||
| Terminal Value | 369,917 | |||||
| WACC / Discount Rate | 9.01% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 674 | 6,893 | 6,548 | 6,301 | 5,721 | 240,257 |
| Enterprise Value | 266,394 | |||||
| Projection Period | 26,137 | 9.8% | ||||
| Terminal Value | 240,257 | 90.2% | ||||
| (−) Current Net Debt | (3,296) | |||||
| Equity Value | 269,690 | |||||
| (÷) Outstanding Shares | 632M | |||||
| Fair Price | $426 | +118.4% | ||||
| WACC \ EV/EBITDA Exit Multiple | 18.9x | 20.9x | 22.9x | 24.9x | 26.9x |
|---|---|---|---|---|---|
| 7.0% | $393 | $429 | $466 | $502 | $539 |
| 8.0% | $376 | $411 | $445 | $480 | $515 |
| 9.0% | $360 | $393 | $426 | $460 | $493 |
| 10.0% | $345 | $377 | $408 | $440 | $472 |
| 11.0% | $331 | $361 | $391 | $422 | $452 |
Current price: $195.26. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.