Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Chipotle Mexican Grill, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 8.6% to 7.8% 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 7, DPO 10, DIO 2). At a 8.2% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 12.3x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $27.24 per share, suggesting CMG is overvalued by 15.7% at the current price of $32.31.
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 | 2,127 | 2,362 | 2,638 | 2,970 | 3,202 | 3,282 |
| (−) Net Interest | 259 | 288 | 321 | 362 | 390 | 400 |
| (+) D&A | 548 | 605 | 669 | 737 | 820 | 841 |
| EBITDA | 2,935 | 3,255 | 3,629 | 4,069 | 4,412 | 4,522 |
| (−) Tax | 489 | 543 | 607 | 683 | 736 | — |
| (−) CapEx | 723 | 803 | 897 | 1,010 | 1,089 | — |
| (−) ΔWC | -49 | 4 | 5 | 6 | 4 | — |
| Free Cash Flow (FCF) | 1,771 | 1,904 | 2,121 | 2,370 | 2,583 | — |
| Peers' EBITDA Multiple | 12.3x | |||||
| Terminal Value | 55,441 | |||||
| WACC / Discount Rate | 8.23% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,703 | 1,691 | 1,740 | 1,797 | 1,809 | 37,336 |
| Enterprise Value | 46,076 | |||||
| Projection Period | 8,740 | 19.0% | ||||
| Terminal Value | 37,336 | 81.0% | ||||
| (−) Current Net Debt | 9,499 | |||||
| Equity Value | 36,577 | |||||
| (÷) Outstanding Shares | 1343M | |||||
| Fair Price | $27 | -15.7% | ||||
| WACC \ EV/EBITDA Exit Multiple | 8.3x | 10.3x | 12.3x | 14.3x | 16.3x |
|---|---|---|---|---|---|
| 6.2% | $20 | $25 | $30 | $35 | $40 |
| 7.2% | $19 | $24 | $29 | $33 | $38 |
| 8.2% | $18 | $23 | $27 | $32 | $36 |
| 9.2% | $17 | $22 | $26 | $30 | $35 |
| 10.2% | $16 | $20 | $25 | $29 | $33 |
Current price: $32.31. 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.