Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Constellation Energy Corporation's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 17.1% to 4.4% 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 51, DPO 42, DIO 43). At a 6.8% WACC with mid-year discounting, the terminal value (87% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 13.6x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $459.09 per share, suggesting CEG is undervalued by 56.1% at the current price of $294.11.
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 | 7,689 | 8,081 | 8,553 | 8,942 | 9,337 | 9,570 |
| (−) Net Interest | 503 | 529 | 560 | 585 | 611 | 626 |
| (+) D&A | 2,191 | 2,473 | 2,711 | 2,836 | 2,961 | 3,035 |
| EBITDA | 10,383 | 11,083 | 11,823 | 12,364 | 12,909 | 13,231 |
| (−) Tax | 3,844 | 4,040 | 4,276 | 4,471 | 4,668 | — |
| (−) CapEx | 2,740 | 2,880 | 3,048 | 3,187 | 3,327 | — |
| (−) ΔWC | -1,766 | 216 | 260 | 215 | 217 | — |
| Free Cash Flow (FCF) | 5,564 | 3,947 | 4,239 | 4,491 | 4,695 | — |
| Peers' EBITDA Multiple | 13.6x | |||||
| Terminal Value | 180,211 | |||||
| WACC / Discount Rate | 6.78% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 5,384 | 3,577 | 3,598 | 3,570 | 3,495 | 129,812 |
| Enterprise Value | 149,436 | |||||
| Projection Period | 19,624 | 13.1% | ||||
| Terminal Value | 129,812 | 86.9% | ||||
| (−) Current Net Debt | 5,244 | |||||
| Equity Value | 144,192 | |||||
| (÷) Outstanding Shares | 314M | |||||
| Fair Price | $459 | +56.1% | ||||
| WACC \ EV/EBITDA Exit Multiple | 9.6x | 11.6x | 13.6x | 15.6x | 17.6x |
|---|---|---|---|---|---|
| 4.8% | $369 | $436 | $503 | $570 | $636 |
| 5.8% | $353 | $417 | $480 | $544 | $608 |
| 6.8% | $338 | $398 | $459 | $520 | $581 |
| 7.8% | $323 | $381 | $439 | $497 | $555 |
| 8.8% | $309 | $365 | $420 | $475 | $531 |
Current price: $294.11. 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.