Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Snap-on Incorporated's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -8.0% to 2.9% 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 39, DIO 146). At a 8.7% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 16.1x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $608.49 per share, suggesting SNA is undervalued by 67.8% at the current price of $362.60.
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 | 1,905 | 1,964 | 2,036 | 2,171 | 2,234 | 2,290 |
| (−) Net Interest | 48 | 50 | 52 | 55 | 57 | 58 |
| (+) D&A | 82 | 83 | 83 | 80 | 81 | 83 |
| EBITDA | 2,035 | 2,097 | 2,170 | 2,307 | 2,372 | 2,431 |
| (−) Tax | 424 | 437 | 453 | 483 | 497 | — |
| (−) CapEx | 78 | 81 | 84 | 89 | 92 | — |
| (−) ΔWC | 285 | 60 | 75 | 139 | 65 | — |
| Free Cash Flow (FCF) | 1,248 | 1,519 | 1,559 | 1,595 | 1,719 | — |
| Peers' EBITDA Multiple | 16.1x | |||||
| Terminal Value | 39,097 | |||||
| WACC / Discount Rate | 8.68% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,197 | 1,340 | 1,266 | 1,192 | 1,182 | 25,782 |
| Enterprise Value | 31,959 | |||||
| Projection Period | 6,177 | 19.3% | ||||
| Terminal Value | 25,782 | 80.7% | ||||
| (−) Current Net Debt | (298) | |||||
| Equity Value | 32,257 | |||||
| (÷) Outstanding Shares | 53M | |||||
| Fair Price | $609 | +67.9% | ||||
| WACC \ EV/EBITDA Exit Multiple | 12.1x | 14.1x | 16.1x | 18.1x | 20.1x |
|---|---|---|---|---|---|
| 6.7% | $529 | $595 | $661 | $728 | $794 |
| 7.7% | $507 | $571 | $634 | $698 | $761 |
| 8.7% | $487 | $548 | $608 | $669 | $729 |
| 9.7% | $469 | $526 | $584 | $642 | $700 |
| 10.7% | $451 | $506 | $561 | $616 | $671 |
Current price: $362.60. 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.