Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Seagate Technology Holdings plc's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 26.7% to -15.0% 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 40, DPO 100, DIO 75). At a 9.3% WACC with mid-year discounting, the terminal value (87% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 24.4x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $202.87 per share, suggesting STX is overvalued by 46.9% at the current price of $381.87.
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 | 998 | 1,252 | 1,449 | 1,766 | 1,501 | 1,538 |
| (−) Net Interest | 393 | 493 | 571 | 695 | 591 | 606 |
| (+) D&A | 343 | 331 | 365 | 429 | 533 | 546 |
| EBITDA | 1,733 | 2,076 | 2,385 | 2,889 | 2,625 | 2,690 |
| (−) Tax | 80 | 100 | 116 | 141 | 120 | — |
| (−) CapEx | 438 | 550 | 637 | 775 | 659 | — |
| (−) ΔWC | -229 | 175 | 136 | 218 | -182 | — |
| Free Cash Flow (FCF) | 1,445 | 1,251 | 1,496 | 1,755 | 2,028 | — |
| Peers' EBITDA Multiple | 24.4x | |||||
| Terminal Value | 65,748 | |||||
| WACC / Discount Rate | 9.28% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,382 | 1,095 | 1,199 | 1,287 | 1,360 | 42,184 |
| Enterprise Value | 48,506 | |||||
| Projection Period | 6,322 | 13.0% | ||||
| Terminal Value | 42,184 | 87.0% | ||||
| (−) Current Net Debt | 4,482 | |||||
| Equity Value | 44,024 | |||||
| (÷) Outstanding Shares | 217M | |||||
| Fair Price | $203 | -46.9% | ||||
| WACC \ EV/EBITDA Exit Multiple | 20.4x | 22.4x | 24.4x | 26.4x | 28.4x |
|---|---|---|---|---|---|
| 7.3% | $188 | $206 | $223 | $241 | $258 |
| 8.3% | $179 | $196 | $213 | $229 | $246 |
| 9.3% | $171 | $187 | $203 | $219 | $235 |
| 10.3% | $163 | $178 | $194 | $209 | $224 |
| 11.3% | $156 | $170 | $185 | $199 | $214 |
Current price: $381.87. 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.