Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Aptiv PLC's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 5.3% to 5.0% 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 71, DPO 72, DIO 54). At a 7.0% WACC with mid-year discounting, the terminal value (80% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 2.5% perpetual rate. After subtracting net debt, the equity value implies a fair price of $36.27 per share, suggesting APTV is overvalued by 48.6% at the current price of $70.61.
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 | 576 | 604 | 633 | 668 | 702 | 720 |
| (−) Net Interest | 305 | 321 | 336 | 355 | 372 | 382 |
| (+) D&A | 769 | 825 | 842 | 857 | 897 | 919 |
| EBITDA | 1,651 | 1,750 | 1,812 | 1,880 | 1,972 | 2,021 |
| (−) Tax | 0 | 0 | 0 | 0 | 0 | 0 |
| (−) CapEx | 888 | 932 | 977 | 1,031 | 1,083 | 1,110 |
| (−) ΔWC | 55 | 163 | 166 | 200 | 192 | 197 |
| Free Cash Flow (FCFF) | 707 | 655 | 668 | 648 | 696 | 714 |
| Terminal Value | 15,946 | |||||
| WACC / Discount Rate | 7.0% | |||||
| Long-term Growth Rate | 2.5% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 684 | 592 | 565 | 512 | 514 | 11,383 |
| Enterprise Value | 14,249 | |||||
| Projection Period | 2,866 | 20.1% | ||||
| Terminal Value | 11,383 | 79.9% | ||||
| (−) Current Net Debt | 6,243 | |||||
| Equity Value | 8,006 | |||||
| (/) Outstanding Shares | 221 | |||||
| Fair Price | $36.27 | |||||
| WACC \ Terminal Growth Rate | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 5.0% | $58 | $71 | $88 | $114 | $157 |
| 6.0% | $39 | $46 | $55 | $66 | $83 |
| 7.0% | $27 | $31 | $36 | $43 | $51 |
| 8.0% | $18 | $21 | $25 | $29 | $34 |
| 9.0% | $12 | $14 | $17 | $19 | $23 |
Current price: $70.61. Green = undervalued, Red = overvalued.
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue is projected using analyst consensus estimates, while expenses (COGS, SG&A, R&D, Interest) are modeled as individual line items based on historical ratios. Depreciation is calculated from a vintage matrix that tracks each year's CapEx depreciated straight-line over its useful life. Working capital is projected using historical turnover days (DSO, DPO, DIO).
FCFF equals EBITDA minus taxes, capital expenditure, and change in net working capital. The terminal value is calculated using the Gordon Growth Model on the Year 6 FCFF. Cash flows are discounted at the Weighted Average Cost of Capital (WACC) using mid-year convention. Enterprise value is converted to equity value by subtracting net debt (total debt minus cash).