Using an unlevered Free Cash Flow to Firm (FCFF) model, we project BlackRock, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 17.4% to 5.7% 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 77, DPO 46, DIO 60). At a 7.8% WACC with mid-year discounting, the terminal value (82% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 15.6x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $1198.73 per share, suggesting BLK is undervalued by 23.0% at the current price of $974.86.
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 | 9,691 | 10,748 | 12,077 | 12,917 | 13,657 | 13,999 |
| (−) Net Interest | 536 | 595 | 668 | 715 | 756 | 775 |
| (+) D&A | 370 | 409 | 422 | 487 | 580 | 594 |
| EBITDA | 10,597 | 11,752 | 13,167 | 14,119 | 14,993 | 15,368 |
| (−) Tax | 2,110 | 2,340 | 2,629 | 2,812 | 2,973 | — |
| (−) CapEx | 538 | 597 | 671 | 718 | 759 | — |
| (−) ΔWC | 1,381 | 713 | 897 | 566 | 500 | — |
| Free Cash Flow (FCF) | 6,568 | 8,102 | 8,970 | 10,023 | 10,761 | — |
| Peers' EBITDA Multiple | 15.6x | |||||
| Terminal Value | 240,353 | |||||
| WACC / Discount Rate | 7.76% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 6,327 | 7,242 | 7,441 | 7,716 | 7,687 | 165,403 |
| Enterprise Value | 201,817 | |||||
| Projection Period | 36,414 | 18.0% | ||||
| Terminal Value | 165,403 | 82.0% | ||||
| (−) Current Net Debt | 3,528 | |||||
| Equity Value | 198,289 | |||||
| (÷) Outstanding Shares | 165M | |||||
| Fair Price | $1199 | +23.0% | ||||
| WACC \ EV/EBITDA Exit Multiple | 11.6x | 13.6x | 15.6x | 17.6x | 19.6x |
|---|---|---|---|---|---|
| 5.8% | $1027 | $1167 | $1308 | $1448 | $1589 |
| 6.8% | $984 | $1118 | $1252 | $1386 | $1520 |
| 7.8% | $943 | $1071 | $1199 | $1327 | $1454 |
| 8.8% | $904 | $1026 | $1148 | $1271 | $1393 |
| 9.8% | $867 | $984 | $1101 | $1217 | $1334 |
Current price: $974.86. 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.