Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Conagra Brands, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -3.1% to 0.5% 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 26, DPO 69, DIO 84). At a 6.4% WACC with mid-year discounting, the terminal value (74% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 11.0x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $29.24 per share, suggesting CAG is undervalued by 91.8% at the current price of $15.24.
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 | 1,132 | 1,120 | 1,133 | 1,159 | 1,164 | 1,193 |
| (−) Net Interest | 397 | 393 | 398 | 407 | 409 | 419 |
| (+) D&A | 422 | 402 | 390 | 399 | 404 | 414 |
| EBITDA | 1,952 | 1,915 | 1,920 | 1,964 | 1,977 | 2,026 |
| (−) Tax | 238 | 236 | 238 | 244 | 245 | — |
| (−) CapEx | 407 | 402 | 407 | 416 | 418 | — |
| (−) ΔWC | -88 | -12 | 13 | 26 | 5 | — |
| Free Cash Flow (FCF) | 1,395 | 1,289 | 1,262 | 1,278 | 1,308 | — |
| Peers' EBITDA Multiple | 11.0x | |||||
| Terminal Value | 22,289 | |||||
| WACC / Discount Rate | 6.38% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,352 | 1,175 | 1,081 | 1,029 | 991 | 16,361 |
| Enterprise Value | 21,990 | |||||
| Projection Period | 5,629 | 25.6% | ||||
| Terminal Value | 16,361 | 74.4% | ||||
| (−) Current Net Debt | 8,000 | |||||
| Equity Value | 13,990 | |||||
| (÷) Outstanding Shares | 478M | |||||
| Fair Price | $29 | +91.9% | ||||
| WACC \ EV/EBITDA Exit Multiple | 7.0x | 9.0x | 11.0x | 13.0x | 15.0x |
|---|---|---|---|---|---|
| 4.4% | $20 | $26 | $33 | $40 | $47 |
| 5.4% | $18 | $25 | $31 | $38 | $44 |
| 6.4% | $17 | $23 | $29 | $35 | $42 |
| 7.4% | $16 | $21 | $27 | $33 | $39 |
| 8.4% | $14 | $20 | $26 | $31 | $37 |
Current price: $15.24. 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.