Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Meta Platforms, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 24.7% to 13.8% 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 41, DPO 78, DIO 60). At a 8.1% WACC with mid-year discounting, the terminal value (87% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 10.9x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $799.39 per share, suggesting META is undervalued by 34.4% at the current price of $594.89.
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 | 91,098 | 107,924 | 125,639 | 145,667 | 165,695 | 169,837 |
| (−) Net Interest | 473 | 560 | 652 | 756 | 860 | 881 |
| (+) D&A | 36,842 | 45,179 | 53,169 | 64,335 | 76,152 | 78,056 |
| EBITDA | 128,413 | 153,663 | 179,460 | 210,758 | 242,707 | 248,775 |
| (−) Tax | 17,344 | 20,547 | 23,920 | 27,733 | 31,546 | — |
| (−) CapEx | 60,252 | 71,380 | 83,097 | 96,343 | 109,589 | — |
| (−) ΔWC | 14,886 | 4,758 | 5,010 | 5,663 | 5,664 | — |
| Free Cash Flow (FCF) | 35,931 | 56,978 | 67,434 | 81,019 | 95,908 | — |
| Peers' EBITDA Multiple | 10.9x | |||||
| Terminal Value | 2,714,134 | |||||
| WACC / Discount Rate | 8.12% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 34,555 | 50,678 | 55,471 | 61,638 | 67,483 | 1,836,574 |
| Enterprise Value | 2,106,399 | |||||
| Projection Period | 269,825 | 12.8% | ||||
| Terminal Value | 1,836,574 | 87.2% | ||||
| (−) Current Net Debt | 48,024 | |||||
| Equity Value | 2,058,375 | |||||
| (÷) Outstanding Shares | 2574M | |||||
| Fair Price | $800 | +34.4% | ||||
| WACC \ EV/EBITDA Exit Multiple | 6.9x | 8.9x | 10.9x | 12.9x | 14.9x |
|---|---|---|---|---|---|
| 6.1% | $588 | $731 | $875 | $1018 | $1162 |
| 7.1% | $562 | $699 | $836 | $973 | $1110 |
| 8.1% | $538 | $669 | $799 | $930 | $1061 |
| 9.1% | $515 | $640 | $765 | $890 | $1014 |
| 10.1% | $493 | $612 | $732 | $851 | $970 |
Current price: $594.89. 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.