Discounted Cash Flow

Arch Capital Group Ltd.

ACGL · Based on 10 years of SEC filings

Average annual growth rates

Metric 10-Year 5-Year 3-Year
Sales
Free Cash Flow
Average (FCF & NI)
Net Income

Average annual growth is the mean year-over-year change across each period.

Endpoint CAGR (better for long term trend)

Metric 10-Year 5-Year 3-Year
Sales
Free Cash Flow
Average (FCF & NI)
Net Income

Endpoint CAGR is the compound annual rate from the first to last year in each period.

Projections use average year-over-year growth. Change this in Settings.

Projected growth rate

Free cash flow growth
10-year: — 5-year: — 3-year: —
Averaged growth (FCF & NI)
10-year: — 5-year: — 3-year: —
Net income growth
10-year: — 5-year: — 3-year: —
Sales growth (not added to calculations)
10-year: — 5-year: — 3-year: —

Click a greyed-out slider to switch metrics. Slide between the 10-year, 5-year, and 3-year historic growth rates for FCF, net income, or their average.

%
%

Historical inputs (10 fiscal years)

YEAR Sales Net Income Free Cash Flow Net Margin EPS (diluted)
2016 $4.5b $692.7m $1.4b 15.5% $5.50
2017 $5.6b (26.1%) $619.3m (-10.6%) $1.1b (-21.1%) 11.0% (-29.1%) $4.21 (-23.5%)
2018 $5.5b (-3.1%) $758.0m (22.4%) $1.5b (40.4%) 13.9% (26.4%) $1.76 (-58.2%)
2019 $6.9b (27.1%) $1.6b (115.9%) $2.0b (31.5%) 23.6% (69.8%) $3.97 (125.6%)
2020 $8.5b (22.8%) $1.4b (-14.1%) $2.8b (41.6%) 16.5% (-30.1%) $3.38 (-14.9%)
2021 $9.2b (8.7%) $2.2b (53.5%) $3.4b (19.0%) 23.3% (41.2%) $5.34 (58.0%)
2022 $9.6b (3.9%) $1.5b (-31.5%) $3.8b (11.2%) 15.4% (-34.1%) $3.90 (-27.0%)
2023 $13.6b (41.8%) $4.4b (200.8%) $5.7b (51.3%) 32.6% (112.1%) $11.94 (206.2%)
2024 $17.4b (27.9%) $4.3b (-2.9%) $6.6b (16.2%) 24.7% (-24.1%) $11.47 (-3.9%)
2025 $19.9b (14.3%) $4.4b (2.0%) $6.1b (-7.5%) 22.1% (-10.7%) $11.83 (3.1%)

Base FCF: (latest fiscal year)

Discount rate: %

Terminal growth:

Projection period: years

Alt A decline yrs:

Alt B total yrs:

Values abbreviated: b = billions, m = millions, k = thousands.

Projected cash flows

Year Projected cash flow Discount Factor Present Value

PV of projected FCF:

Terminal FCF:

Terminal value:

PV of terminal value:

Enterprise value (DCF):

DCF price per share:

Current price:

Alternative DCF Models

Model Fair Value Upside PV(FCFs) PV(Terminal) Total Years
Standard (10yr→TV) 10 + TV
Alt A (Gradual Decline)
Alt B (30yr Hard Stop) N/A

This is a simplified DCF model for illustration. It uses reported free cash flow, a single growth assumption, fixed WACC, and a Gordon Growth terminal value. It is not investment advice.

+ 10YR Financials Balance Sheet (10YR) Cash Flow (10YR) DCF Model