Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Equinix, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 10.2% to 10.6% 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 53, DPO 11, DIO 60). At a 7.2% WACC with mid-year discounting, the terminal value (98% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 21.4x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $938.43 per share, suggesting EQIX is fairly valued by 3.2% at the current price of $969.22.
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 | 1,336 | 1,454 | 1,588 | 1,776 | 1,964 | 2,014 |
| (−) Net Interest | 535 | 583 | 637 | 712 | 788 | 807 |
| (+) D&A | 3,038 | 3,256 | 3,637 | 3,995 | 4,404 | 4,514 |
| EBITDA | 4,909 | 5,293 | 5,862 | 6,483 | 7,156 | 7,335 |
| (−) Tax | 197 | 215 | 234 | 262 | 290 | — |
| (−) CapEx | 3,844 | 4,185 | 4,570 | 5,111 | 5,653 | — |
| (−) ΔWC | 1,307 | 194 | 218 | 307 | 307 | — |
| Free Cash Flow (FCF) | -439 | 699 | 839 | 803 | 906 | — |
| Peers' EBITDA Multiple | 21.4x | |||||
| Terminal Value | 157,191 | |||||
| WACC / Discount Rate | 7.23% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | -424 | 630 | 705 | 629 | 661 | 110,861 |
| Enterprise Value | 113,062 | |||||
| Projection Period | 2,201 | 1.9% | ||||
| Terminal Value | 110,861 | 98.1% | ||||
| (−) Current Net Debt | 20,999 | |||||
| Equity Value | 92,063 | |||||
| (÷) Outstanding Shares | 98M | |||||
| Fair Price | $938 | -3.2% | ||||
| WACC \ EV/EBITDA Exit Multiple | 17.4x | 19.4x | 21.4x | 23.4x | 25.4x |
|---|---|---|---|---|---|
| 5.2% | $820 | $936 | $1051 | $1167 | $1283 |
| 6.2% | $772 | $883 | $993 | $1104 | $1214 |
| 7.2% | $728 | $833 | $938 | $1044 | $1149 |
| 8.2% | $685 | $786 | $886 | $987 | $1088 |
| 9.2% | $645 | $741 | $837 | $933 | $1030 |
Current price: $969.22. 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.