AEO — Valuation Models

Interactive models with editable assumptions. All calculations run client-side.

Valuation Summary

Model	Intrinsic Value	vs Price ($22.50)
DCF	$6.72	-70.1%
Graham Number	$15.61	-30.6%
Reverse DCF	—	implied g: 41.3%
DDM	$10.30	-54.2%
EV/EBITDA	$22.50	+0.0%

Values reflect default assumptions. Adjust inputs in each model below to update.

1 — Discounted Cash Flow (DCF)

Assumptions

Base FCF($B)Yahoo: $42.84M

Near-term growth (yrs 1–5)(%)Rev: 5.7% / EPS: 29.3%

Long-term growth (yrs 6–10)(%)

Terminal growth rate(%)

WACC(%)Computed: 7.72%

Computed WACC: 7.72%

Cost of equity (Re)11.71%(Rf 4.30% + β 1.35 × ERP 5.50%)

Cost of debt (Rd)0.00%(no debt / unavailable → 0%)

Tax rate (T)21.00%(US statutory fallback)

Equity weight (E/V)65.93%

Debt weight (D/V)34.07%

Results

Intrinsic Value / share$11.95

Current Price$22.50

Upside / Downside-46.9%

Net Debt (used)$1.86B

Sensitivity: WACC (rows) × Near-term g (cols)

WACC \ Near-term	21.3%	25.3%	29.3%	33.3%	37.3%
7.0%	$9.02	$12.42	$16.27	$20.62	$25.52
8.0%	$4.88	$7.56	$10.59	$14.01	$17.85
9.0%	$2.05	$4.23	$6.69	$9.47	$12.60
10.0%	$-0.01	$1.81	$3.87	$6.19	$8.79
11.0%	$-1.56	$-0.02	$1.73	$3.70	$5.92

2 — Graham Number

Assumptions

MultiplierGraham used 22.5 (15× P/E × 1.5× P/B)

EPS (trailing)($)Yahoo: $1.13

Book Value / share($)Yahoo: $9.59

Results

Graham Number$15.61

Current Price$22.50

Margin of Safety-30.6%

Formula: √(22.5 × max(0,EPS) × max(0,BVPS))

3 — Reverse DCF (Implied Growth)

Assumptions

WACC(%)Computed: 7.72%

Terminal growth rate(%)

Computed WACC: 7.72%

Cost of equity (Re)11.71%(Rf 4.30% + β 1.35 × ERP 5.50%)

Cost of debt (Rd)0.00%(no debt / unavailable → 0%)

Tax rate (T)21.00%(US statutory fallback)

Equity weight (E/V)65.93%

Debt weight (D/V)34.07%

Results

Current Price$22.50

Implied Near-term FCF Growth36.2%

Historical Revenue Growth5.7%

Historical Earnings Growth29.3%

Base FCF (TTM)$42.84M

Implied growth is the FCF growth rate (yrs 1–5) that makes the DCF intrinsic value equal the current price. Long-term growth is set to half the implied near-term rate.

4 — Dividend Discount Model (DDM)

Assumptions

Annual dividend D0($/share)Yahoo: $0.50

Dividend growth rate (g)(%)

Required return (r)(%)

Results

DDM Intrinsic Value / share$10.30

Current Price$22.50

Upside / Downside-54.2%

Formula: D0 × (1+g) / (r − g)

5 — EV/EBITDA Multiple

Assumptions

EBITDA($B)Yahoo: $514.33M

Target EV/EBITDA multipleCurrent: 11.0×

Net Debt($B)Default: $1.86B

Results

Implied Equity Value / share$22.50

Current Price$22.50

Upside / Downside+0.0%

Implied EV$5.67B

Sensitivity: EV/EBITDA multiple (rows) × Net Debt (cols)

Mult \ Net Debt	$1.86B	$1.86B	$1.86B	$1.86B	$1.86B
7.0x	$10.36	$10.36	$10.36	$10.36	$10.36
9.0x	$16.43	$16.43	$16.43	$16.43	$16.43
11.0x	$22.50	$22.50	$22.50	$22.50	$22.50
13.0x	$28.57	$28.57	$28.57	$28.57	$28.57
15.0x	$34.64	$34.64	$34.64	$34.64	$34.64

← Overview Financial Statements ← Companies