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HEICO Corp
NYSE:HEI

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HEICO Corp Logo
HEICO Corp
NYSE:HEI
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Price: 175.9 USD +2.85% Market Closed
Updated: Dec 4, 2023
Section:
 

DCF Value

This DCF valuation model was created by Alpha Spread and was last updated on Dec 3, 2023.

Estimated DCF Value of one HEI stock is 68.6 USD. Compared to the current market price of 175.9 USD, the stock is Overvalued by 61%.

HEI DCF Value
Base Case
68.6 USD
Overvaluation 61%
DCF Value
Price
Worst Case
Base Case
Best Case
68.6
DCF Value
Worst Case
Base Case
Best Case
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DCF Value: 68.6 USD
HEICO Corp Competitors:
DCF Valuation
TDG
TransDigm Group Inc
MRCY
Mercury Systems Inc
NPK
National Presto Industries Inc
NOC
Northrop Grumman Corp
TDG
TransDigm Group Inc
MRCY
Mercury Systems Inc
NPK
National Presto Industries Inc
NOC
Northrop Grumman Corp
PKE
Park Aerospace Corp
LHX
L3harris Technologies Inc
LMT
Lockheed Martin Corp
PSN
Parsons Corp

Valuation Analysis

DCF Financials
Financials used in DCF Calculation

Revenue
3.6B 4.8B
Operating Income
744m 1B
FCFF
674m 842m

Sensitivity Analysis
DCF Value Sensitivity Analysis

Revenue Growth Operating Margin Discount Rate

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
1 valuation model available
Alpha Spread
Updated on Dec 3, 2023
Default Valuation
Create My Valuation Model
Other investors haven't shared any valuation models for HEICO Corp.
Model Settings
Operating Model
Worst Case Base Case Best Case
Discount Rate
8.05%
Forecast Period
5 Years
Terminal Growth
0%
Discount Rate
8.05%
Terminal Growth
0%
Growth Period
5 Years
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DCF Model
Base Case Scenario

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DCF Model
Currency: USD
Millions
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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 10.2B USD
+ Cash & Equivalents 694m USD
Firm Value 10.9B USD
- Debt 1.2B USD
- Minority Interest 389m USD
Equity Value 9.3B USD
/ Shares Outstanding 135m
HEI DCF Value 68.6 USD
Overvalued by 61%

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

See Also

Summary
HEI intrinsic value, competitors valuation, and company profile.
DCF Valuation
HEI stock valuation using Discount Cash Flow valuation method.
Relative Valuation
HEI stock valuation using valuation multiples.
Wall Street Estimates
HEI price targets and financial estimates made by Wall st analysts.
Profitability Analysis
Detailed analysis of the company's profitability.
Solvency Analysis
Analysis of the financial position and solvency of the company.
Financials
Income Statement, Balance Sheet, Cash Flow Statement.
Discount Rate
HEI stock discount rate: cost of equity and WACC.
Summary
DCF Valuation
Relative Valuation
Wall Street Estimates
Profitability Analysis
Solvency Analysis
Financials
Discount Rate
Discover More

What is the DCF value of one HEI stock?

Estimated DCF Value of one HEI stock is 68.6 USD. Compared to the current market price of 175.9 USD, the stock is Overvalued by 61%.

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 HEICO Corp's future free cash flow and discount it at a selected discount rate to calculate its Present Value (10.2B 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 68.6 USD per one HEI share.

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How is DCF value calculated?

Alpha Spread forecasts a company's future cash flow and estimates the appropriate discount rate to calculate the DCF value of a stock.

1. Free cash flow forecasting

You can view the operating model used to estimate free cash flow in the "DCF Operating Model" block. You can change model inputs forecasted by our algorithm (such as revenue growth, margins, etc.) if you are a professional analyst and have your own opinion about them.
Click here to read more about FCF forecasting.

2. Calculating present value

Once free cash flow is forecasted, it is discounted at a risk-appropriate discount rate (which you can also change in the DCF settings). The resulting value is the present value of the company's free cash flow.

DCF Operating Model
Capital Structure
3. Calculating the value of equity

Depending on which type of operating model for the company our algorithm has 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. You can see these and subsequent steps in the block "Capital structure".

4. Calculating the DCF value of one stock

In order to come from the value of equity to the DCF value of one share, we only need divide the equity value by the number of shares outstanding.

See Also:
What is DCF valuation? What are valuation scenarios?
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