Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Welltower Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 22.9% to 22.7% 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 162, DPO 19, DIO 60). At a 7.5% WACC with mid-year discounting, the terminal value (86% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 22.6x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $160.39 per share, suggesting WELL is overvalued by 17.9% at the current price of $195.29.
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 | 3,312 | 3,684 | 4,159 | 4,039 | 4,955 | 5,079 |
| (−) Net Interest | 1,111 | 1,235 | 1,394 | 1,354 | 1,661 | 1,703 |
| (+) D&A | 38 | 49 | 59 | 67 | 74 | 75 |
| EBITDA | 4,462 | 4,968 | 5,612 | 5,460 | 6,689 | 6,857 |
| (−) Tax | 52 | 58 | 65 | 64 | 78 | — |
| (−) CapEx | 73 | 81 | 91 | 89 | 109 | — |
| (−) ΔWC | 2,305 | 752 | 962 | -243 | 1,856 | — |
| Free Cash Flow (FCF) | 2,031 | 4,077 | 4,493 | 5,551 | 4,647 | — |
| Peers' EBITDA Multiple | 22.6x | |||||
| Terminal Value | 155,099 | |||||
| WACC / Discount Rate | 7.45% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,960 | 3,660 | 3,755 | 4,317 | 3,363 | 108,295 |
| Enterprise Value | 125,350 | |||||
| Projection Period | 17,055 | 13.6% | ||||
| Terminal Value | 108,295 | 86.4% | ||||
| (−) Current Net Debt | 16,347 | |||||
| Equity Value | 109,003 | |||||
| (÷) Outstanding Shares | 680M | |||||
| Fair Price | $160 | -17.9% | ||||
| WACC \ EV/EBITDA Exit Multiple | 18.6x | 20.6x | 22.6x | 24.6x | 26.6x |
|---|---|---|---|---|---|
| 5.4% | $146 | $162 | $177 | $193 | $208 |
| 6.4% | $139 | $154 | $169 | $183 | $198 |
| 7.4% | $132 | $146 | $160 | $174 | $189 |
| 8.4% | $126 | $139 | $153 | $166 | $179 |
| 9.4% | $119 | $132 | $145 | $158 | $171 |
Current price: $195.29. 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.