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Mastercard’s Stock Analysis Valuation Assumptions:
Today I’ll make a stock analysis based on the Discounted Cash Flow Model.
Here’s my assumptions:
Risk Free Rate (10 Years Interest Rate Swap): 4.131%
Risk Premium (Taken from the Aswath Damodaran equity premium spreadsheet): 4.33%
Interest Rate Spread on The Risk free rate ( For the cost of debt calculation): 3%
HISTORICAL DATA
Revenue growth in the last 10 years (CAGR): 12.62%
Earnings growth in the last 10 years (CAGR): 14.49%
Unlevered Free Cash Flow growth in the last 10 years (CAGR): 13.82%
FUTURE ASSUMPTIONS
End of Year FCF growth: 10%
Growth until end of 2026: 8%
Growth until end of 2034: 6%
Perpetual growth: 3.2%
Net Debt: 10.706B
Stock Options Present Value Assumption: $0.634B
Restricted Stock Units Present Value Assumption: 1.552B
Stock Valuation based on these assumptions: $764
Last update 05/13/2025
All the content in this newsletter should be taken as informational content only. THIS IS NOT FINANCIAL ADVICE! Do your own Due Diligence before investing or contact a professional financial advisor.
I don’t have a position in Mastercard (MA) and I don’t plan to add any position in the coming days.