Discounted Cash Flow

Morningstar, Inc.

MORN · 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 $798.6m $161.0m $150.9m 20.2% $3.74
2017 $911.7m (14.2%) $136.9m (-15.0%) $183.5m (21.6%) 15.0% (-25.5%) $3.21 (-14.2%)
2018 $1.0b (11.9%) $183.0m (33.7%) $238.7m (30.1%) 17.9% (19.5%) $4.30 (34.0%)
2019 $1.2b (15.6%) $114.1m (-37.7%) $254.4m (6.6%) 9.7% (-46.1%) $3.56 (-17.2%)
2020 $1.4b (17.9%) $137.7m (20.7%) $307.6m (20.9%) 9.9% (2.4%) $5.22 (46.6%)
2021 $1.7b (22.3%) $155.7m (13.1%) $348.1m (13.2%) 9.2% (-7.5%) $4.50 (-13.8%)
2022 $1.9b (10.1%) $25.9m (-83.4%) $168.3m (-51.7%) 1.4% (-84.9%) $1.65 (-63.3%)
2023 $2.0b (9.0%) $68.4m (164.1%) $197.3m (17.2%) 3.4% (142.3%) $3.31 (100.6%)
2024 $2.3b (11.6%) $296.8m (333.9%) $448.9m (127.5%) 13.0% (288.8%) $8.64 (161.0%)
2025 $2.4b (7.5%) $374.2m (26.1%) $442.6m (-1.4%) 15.3% (17.3%) $8.93 (3.4%)

Base FCF: (latest fiscal year)

Discount rate: %

Terminal growth:

Projection period: years

Alt A decline yrs:

Alt B total yrs:

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