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Apple (AAPL) Stock Valuation
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We use a modified version of a valuation method known as a Discounted Cash Flow Model. This is industry-standard and used by analysts from the most reputable brokers, institutions and research firms around the world.
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The model has two parts, one which models the next 10 years (1st Stage) and one that models the growth after that (Terminal Value).
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The yellow boxs are the same inputs used in the Valuation Tool.
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Next 10 years (1st Stage)
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TodayNext year2 years...
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Year012345678910
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Growth Rate10.0%10.0%10.0%10.0%10.0%10.0%10.0%10.0%10.0%10.0%
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Earnings$1,000,000$1,100,000.0$1,210,000.0$1,331,000.0$1,464,100.0$1,610,510.0$1,771,561.0$1,948,717.1$2,143,588.8$2,357,947.7$2,593,742.5
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Discounted to Today's Value
Total Discounted
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$1,047,619.05$1,097,505.67$1,149,767.84$1,204,518.69$1,261,876.73$1,321,966.09$1,384,916.86$1,450,865.28$1,519,954.11$1,592,332.87$13,031,323.20
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Risk Level/ "Discount Rate"5.0%
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After 10 years (Terminal Value)
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"Perpetual Growth Rate"2.2%
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Terminal Value$94,671,599.8
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Terminal Value Discounted$58,120,149.8
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Totals in Todays Money
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Next 10 years (1st Stage)$13,031,323.20
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After 10 years (Terminal Value)$58,120,149.8
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Grand Total$71,151,473.0
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My Estimate of Fair Value$4,579.1
1. Insert latest Free cash flow figures (Cell B10)
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2. Estimate Future growth rate of cash flows (Cell C9 onwards)
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Market Cap Today$2,828,000.00
3. Estimate the discount rate (Cell C15)
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Share Price Today$182.0
4. Estimate the perpetual growth rate (Cell C18)
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5. Update Cell C29 and C30 with the market cap today and Share price today, respectively
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Discount to Market Cap2415.96%Undervalued
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