Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Old Dominion Freight Line, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 1.3% to 1.1% 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 37, DPO 10, DIO 60). At a 8.9% WACC with mid-year discounting, the terminal value (91% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 22.6x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $220.67 per share, suggesting ODFL is undervalued by 16.6% at the current price of $189.19.
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 | 1,661 | 1,815 | 1,907 | 2,094 | 2,117 | 2,170 |
| (−) Net Interest | 1 | 1 | 1 | 1 | 1 | 1 |
| (+) D&A | 654 | 670 | 652 | 645 | 650 | 666 |
| EBITDA | 2,315 | 2,486 | 2,560 | 2,740 | 2,768 | 2,838 |
| (−) Tax | 412 | 451 | 473 | 520 | 526 | — |
| (−) CapEx | 630 | 688 | 723 | 794 | 803 | — |
| (−) ΔWC | 1,064 | 99 | 59 | 120 | 15 | — |
| Free Cash Flow (FCF) | 209 | 1,248 | 1,305 | 1,307 | 1,425 | — |
| Peers' EBITDA Multiple | 22.6x | |||||
| Terminal Value | 64,270 | |||||
| WACC / Discount Rate | 8.91% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 201 | 1,098 | 1,054 | 969 | 970 | 41,948 |
| Enterprise Value | 46,241 | |||||
| Projection Period | 4,293 | 9.3% | ||||
| Terminal Value | 41,948 | 90.7% | ||||
| (−) Current Net Debt | (80) | |||||
| Equity Value | 46,321 | |||||
| (÷) Outstanding Shares | 210M | |||||
| Fair Price | $221 | +16.7% | ||||
| WACC \ EV/EBITDA Exit Multiple | 18.6x | 20.6x | 22.6x | 24.6x | 26.6x |
|---|---|---|---|---|---|
| 6.9% | $202 | $222 | $241 | $261 | $280 |
| 7.9% | $194 | $212 | $231 | $249 | $268 |
| 8.9% | $185 | $203 | $221 | $238 | $256 |
| 9.9% | $177 | $194 | $211 | $228 | $245 |
| 10.9% | $170 | $186 | $202 | $218 | $234 |
Current price: $189.19. 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.