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Alphabet Inc
NASDAQ:GOOGL

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Alphabet Inc Logo
Alphabet Inc
NASDAQ:GOOGL
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Price: 96.97 USD -2.52% Market Closed
Updated: Dec 7, 2022

DCF Value

This DCF valuation model was created by Alpha Spread and was last updated on Dec 6, 2022.

Estimated DCF Value of one GOOGL stock is 101.13 USD. Compared to the current market price of 96.97 USD, the stock is Undervalued by 4%.

GOOGL DCF Value
Base Case
101.13 USD
Undervaluation 4%
DCF Value
Price
Worst Case
Base Case
Best Case
101.13
DCF Value
Worst Case
Base Case
Best Case
Hide
DCF Value: 101.13 USD
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Present Value Calculation

The first step in the DCF calculation process is to estimate the company's future free cash flow. Once free cash flow is forecasted, it is discounted at a risk-appropriate discount rate. The resulting value is the present value of the company's free cash flow. You can change any model inputs below.

Available Valuation Models
4 valuation models available
Alpha Spread
Updated on Dec 6, 2022
Default Valuation
Thijs Nijenhuis
Updated on Sep 27, 2022
Set As Default
abe shop
Updated on Sep 20, 2022
Set As Default
Stockado
Updated on Oct 24, 2022
Set As Default
Create My Valuation Model
Model Settings
Discount Rate
8.53%
Forecast Period
5 Years
Terminal Growth
0%
Discount Rate
8.53%
Terminal Growth
0%
Growth Period
5 Years
Copy as My Model

DCF Model
Base Case Scenario

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DCF Model

To view the process of deriving the DCF Value of one share from the estimated Present Value, see the DCF Value Calculation block.

DCF Value Calculation

Depending on which type of operating model is chosen (equity or whole firm valuation model), the resulting value is either the value of equity or the value of the entire firm. In the case of the latter, to move from the value of the firm to the value of equity, liabilities are subtracted and assets are added.

Capital Structure
From Present Value to DCF Value

Present Value 1.2T USD
+ Cash & Equivalents 22B USD
+ Investments 125B USD
Firm Value 1.3T USD
- Debt 14.7B USD
Equity Value 1.3T USD
/ Shares Outstanding 12.9B
GOOGL DCF Value 101.13 USD
Undervalued by 4%

To view the process of calculating the Present Value of Alphabet Inc' future free cash flow, see the Present Value Calculation block.

Valuation Analysis

After the valuation process, in order to gain a deeper understanding of the relationship between risk and opportunity, it is useful to study the dynamic of company's valuation under various inputs to the DCF model in use.

DCF Financials
Financials used in DCF Calculation

Revenue
309B 516B
Operating Income
81.2B 130B
FCFF
73.8B 106B

Sensitivity Analysis
DCF Value Sensitivity Analysis

See Also

Similar Stocks
What is the DCF value of one GOOGL stock?

Estimated DCF Value of one GOOGL stock is 101.13 USD. Compared to the current market price of 96.97 USD, the stock is Undervalued by 4%.

The true DCF Value lies somewhere between the worst-case and best-case scenario values. This is because the future is not predetermined, and the stock's DCF Value is based almost entirely on the future of the company. Knowing the full range of possible stock DCF values gives a complete picture of the investment risks and opportunities.

How was the DCF Value calculated?

1. Present Value Calculation. Using the DCF Operating Model we project Alphabet Inc's future free cash flow and discount it at a selected discount rate to calculate its Present Value (1.2T USD).

2. DCF Value Calculation. We use the company's capital structure to calculate the total Equity Value based on the previously computed Present Value of the free cash flow. Dividing the Equity Value by the number of shares outstanding gives us the DCF Value of 101.13 USD per one GOOGL share.