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): 3.5%

Risk Premium (Taken from the Aswath Damodaran equity premium spreadsheet): 4.6%

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): 1.95%

Earnings growth in the last 10 years (CAGR): -7.13%

Unlevered Free Cash Flow growth in the last 10 years (CAGR): 7.57%

FUTURE ASSUMPTIONS

End of Year FCF growth: 2%

Growth until end of 2026: 3%

Growth until end of 2034: 3%

Perpetual growth: 3%

Net Debt: 37.555B

Stock Options Present Value Assumption: $52M

Restricted Stock Units Present Value Assumption: $5.179B

Stock Valuation based on these assumptions: $184

Last update 09/23/2024

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 RTX Corporation (RTX) and I don’t plan to add a position in the coming days.