Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Roper Technologies, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 7.8% to 13.1% 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 58, DPO 26, DIO 22). At a 8.2% WACC with mid-year discounting, the terminal value (85% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 19.9x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $460.75 per share, suggesting ROP is undervalued by 30.8% at the current price of $352.33.
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 | 2,078 | 2,212 | 2,384 | 2,696 | 3,049 | 3,125 |
| (−) Net Interest | 322 | 342 | 369 | 417 | 472 | 484 |
| (+) D&A | 71 | 78 | 86 | 87 | 100 | 102 |
| EBITDA | 2,471 | 2,633 | 2,839 | 3,200 | 3,620 | 3,711 |
| (−) Tax | 451 | 480 | 517 | 585 | 661 | — |
| (−) CapEx | 100 | 107 | 115 | 130 | 147 | — |
| (−) ΔWC | 80 | 85 | 110 | 199 | 225 | — |
| Free Cash Flow (FCF) | 1,839 | 1,961 | 2,097 | 2,287 | 2,587 | — |
| Peers' EBITDA Multiple | 19.9x | |||||
| Terminal Value | 73,881 | |||||
| WACC / Discount Rate | 8.18% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,768 | 1,743 | 1,723 | 1,737 | 1,816 | 49,876 |
| Enterprise Value | 58,663 | |||||
| Projection Period | 8,787 | 15.0% | ||||
| Terminal Value | 49,876 | 85.0% | ||||
| (−) Current Net Debt | 9,004 | |||||
| Equity Value | 49,660 | |||||
| (÷) Outstanding Shares | 108M | |||||
| Fair Price | $461 | +30.7% | ||||
| WACC \ EV/EBITDA Exit Multiple | 15.9x | 17.9x | 19.9x | 21.9x | 23.9x |
|---|---|---|---|---|---|
| 6.2% | $408 | $459 | $510 | $561 | $612 |
| 7.2% | $387 | $436 | $485 | $533 | $582 |
| 8.2% | $368 | $414 | $461 | $507 | $554 |
| 9.2% | $349 | $394 | $438 | $482 | $527 |
| 10.2% | $332 | $374 | $417 | $459 | $501 |
Current price: $352.33. 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.