Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Vertiv Holdings Co's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 33.0% to 6.2% 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 114, DPO 87, DIO 73). At a 8.8% WACC with mid-year discounting, the terminal value (92% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 18.0x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $93.02 per share, suggesting VRT is overvalued by 63.7% at the current price of $255.93.
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 | 1,304 | 1,616 | 1,871 | 1,995 | 2,119 | 2,172 |
| (−) Net Interest | 280 | 347 | 402 | 429 | 456 | 467 |
| (+) D&A | 147 | 185 | 230 | 282 | 329 | 337 |
| EBITDA | 1,732 | 2,148 | 2,504 | 2,706 | 2,903 | 2,976 |
| (−) Tax | 403 | 500 | 579 | 617 | 655 | — |
| (−) CapEx | 273 | 339 | 392 | 418 | 444 | — |
| (−) ΔWC | 1,077 | 928 | 761 | 370 | 368 | — |
| Free Cash Flow (FCF) | -22 | 382 | 771 | 1,300 | 1,436 | — |
| Peers' EBITDA Multiple | 18.0x | |||||
| Terminal Value | 53,444 | |||||
| WACC / Discount Rate | 8.76% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | -22 | 336 | 625 | 969 | 984 | 35,126 |
| Enterprise Value | 38,020 | |||||
| Projection Period | 2,894 | 7.6% | ||||
| Terminal Value | 35,126 | 92.4% | ||||
| (−) Current Net Debt | 1,675 | |||||
| Equity Value | 36,345 | |||||
| (÷) Outstanding Shares | 391M | |||||
| Fair Price | $93 | -63.6% | ||||
| WACC \ EV/EBITDA Exit Multiple | 14.0x | 16.0x | 18.0x | 20.0x | 22.0x |
|---|---|---|---|---|---|
| 6.8% | $80 | $91 | $102 | $113 | $124 |
| 7.8% | $77 | $87 | $98 | $108 | $118 |
| 8.8% | $73 | $83 | $93 | $103 | $113 |
| 9.8% | $70 | $79 | $89 | $98 | $108 |
| 10.8% | $66 | $76 | $85 | $94 | $103 |
Current price: $255.93. 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.