Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Tyson Foods, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 3.7% to 3.7% 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 17, DPO 19, DIO 40). At a 6.1% WACC with mid-year discounting, the terminal value (86% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 14.8x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $140.56 per share, suggesting TSN is undervalued by 122.5% at the current price of $63.16.
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 | 2,128 | 2,144 | 2,186 | 2,268 | 2,352 | 2,411 |
| (−) Net Interest | 451 | 454 | 463 | 480 | 498 | 511 |
| (+) D&A | 1,429 | 1,497 | 1,431 | 1,361 | 1,464 | 1,500 |
| EBITDA | 4,008 | 4,094 | 4,080 | 4,109 | 4,314 | 4,422 |
| (−) Tax | 557 | 561 | 573 | 594 | 616 | — |
| (−) CapEx | 1,547 | 1,558 | 1,589 | 1,648 | 1,709 | — |
| (−) ΔWC | -17 | 41 | 112 | 213 | 221 | — |
| Free Cash Flow (FCF) | 1,921 | 1,934 | 1,806 | 1,654 | 1,768 | — |
| Peers' EBITDA Multiple | 14.8x | |||||
| Terminal Value | 65,401 | |||||
| WACC / Discount Rate | 6.11% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,865 | 1,769 | 1,557 | 1,344 | 1,353 | 48,613 |
| Enterprise Value | 56,502 | |||||
| Projection Period | 7,889 | 14.0% | ||||
| Terminal Value | 48,613 | 86.0% | ||||
| (−) Current Net Debt | 7,601 | |||||
| Equity Value | 48,901 | |||||
| (÷) Outstanding Shares | 348M | |||||
| Fair Price | $141 | +122.5% | ||||
| WACC \ EV/EBITDA Exit Multiple | 10.8x | 12.8x | 14.8x | 16.8x | 18.8x |
|---|---|---|---|---|---|
| 4.1% | $114 | $135 | $156 | $176 | $197 |
| 5.1% | $108 | $128 | $148 | $168 | $187 |
| 6.1% | $103 | $122 | $141 | $159 | $178 |
| 7.1% | $98 | $116 | $134 | $152 | $170 |
| 8.1% | $93 | $110 | $127 | $144 | $162 |
Current price: $63.16. 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.