Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Equifax Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 11.2% 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 60, DPO 31, DIO 60). At a 8.2% WACC with mid-year discounting, the terminal value (88% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 18.9x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $347.59 per share, suggesting EFX is undervalued by 97.9% at the current price of $175.60.
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 | 1,647 | 1,804 | 1,974 | 2,108 | 2,200 | 2,255 |
| (−) Net Interest | 252 | 276 | 302 | 322 | 336 | 345 |
| (+) D&A | 538 | 579 | 602 | 644 | 715 | 733 |
| EBITDA | 2,437 | 2,658 | 2,878 | 3,074 | 3,251 | 3,332 |
| (−) Tax | 395 | 432 | 473 | 505 | 527 | — |
| (−) CapEx | 676 | 741 | 811 | 865 | 903 | — |
| (−) ΔWC | 548 | 128 | 140 | 110 | 76 | — |
| Free Cash Flow (FCF) | 818 | 1,357 | 1,455 | 1,594 | 1,745 | — |
| Peers' EBITDA Multiple | 18.9x | |||||
| Terminal Value | 63,011 | |||||
| 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 | 786 | 1,205 | 1,194 | 1,208 | 1,223 | 42,439 |
| Enterprise Value | 48,056 | |||||
| Projection Period | 5,617 | 11.7% | ||||
| Terminal Value | 42,439 | 88.3% | ||||
| (−) Current Net Debt | 4,913 | |||||
| Equity Value | 43,143 | |||||
| (÷) Outstanding Shares | 124M | |||||
| Fair Price | $348 | +98.0% | ||||
| WACC \ EV/EBITDA Exit Multiple | 14.9x | 16.9x | 18.9x | 20.9x | 22.9x |
|---|---|---|---|---|---|
| 6.2% | $304 | $344 | $383 | $423 | $463 |
| 7.2% | $289 | $327 | $365 | $403 | $441 |
| 8.2% | $275 | $311 | $348 | $384 | $420 |
| 9.2% | $262 | $297 | $331 | $366 | $400 |
| 10.2% | $250 | $283 | $316 | $349 | $382 |
Current price: $175.60. 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.