Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Intercontinental Exchange, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -15.4% to 8.4% 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 99, DPO 75, DIO 60). At a 7.4% WACC with mid-year discounting, the terminal value (85% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 19.8x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $181.74 per share, suggesting ICE is undervalued by 16.2% at the current price of $156.44.
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 | 4,647 | 4,916 | 5,215 | 5,494 | 5,957 | 6,105 |
| (−) Net Interest | 707 | 748 | 794 | 836 | 907 | 929 |
| (+) D&A | 440 | 441 | 441 | 445 | 471 | 483 |
| EBITDA | 5,794 | 6,105 | 6,449 | 6,775 | 7,335 | 7,518 |
| (−) Tax | 995 | 1,052 | 1,116 | 1,176 | 1,275 | — |
| (−) CapEx | 455 | 481 | 510 | 538 | 583 | — |
| (−) ΔWC | 577 | 157 | 174 | 163 | 270 | — |
| Free Cash Flow (FCF) | 3,768 | 4,415 | 4,648 | 4,898 | 5,207 | — |
| Peers' EBITDA Multiple | 19.8x | |||||
| Terminal Value | 148,630 | |||||
| WACC / Discount Rate | 7.37% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 3,636 | 3,968 | 3,891 | 3,819 | 3,781 | 104,149 |
| Enterprise Value | 123,244 | |||||
| Projection Period | 19,095 | 15.5% | ||||
| Terminal Value | 104,149 | 84.5% | ||||
| (−) Current Net Debt | 19,442 | |||||
| Equity Value | 103,802 | |||||
| (÷) Outstanding Shares | 571M | |||||
| Fair Price | $182 | +16.2% | ||||
| WACC \ EV/EBITDA Exit Multiple | 15.8x | 17.8x | 19.8x | 21.8x | 23.8x |
|---|---|---|---|---|---|
| 5.4% | $161 | $181 | $201 | $222 | $242 |
| 6.4% | $153 | $172 | $191 | $211 | $230 |
| 7.4% | $145 | $163 | $182 | $200 | $219 |
| 8.4% | $137 | $155 | $173 | $190 | $208 |
| 9.4% | $131 | $147 | $164 | $181 | $198 |
Current price: $156.44. 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.