LII — Valuation Models

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

Valuation Summary

Model	Intrinsic Value	vs Price ($563.40)
DCF	$111.26	-80.3%
Graham Number	$131.01	-76.7%
Reverse DCF	—	implied g: 28.5%
DDM	$107.12	-81.0%
EV/EBITDA	$563.41	+0.0%

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

1 — Discounted Cash Flow (DCF)

Assumptions

Base FCF($B)Yahoo: $319.44M

Near-term growth (yrs 1–5)(%)Rev: -11.2% / EPS: -17.9%

Long-term growth (yrs 6–10)(%)

Terminal growth rate(%)

WACC(%)Computed: 10.21%

Computed WACC: 10.21%

Cost of equity (Re)10.83%(Rf 4.30% + β 1.19 × ERP 5.50%)

Cost of debt (Rd)4.14%(interest expense ÷ avg debt (SEC))

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

Equity weight (E/V)91.78%

Debt weight (D/V)8.22%

Results

Intrinsic Value / share$85.68

Current Price$563.40

Upside / Downside-84.8%

Net Debt (used)$1.74B

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

WACC \ Near-term	-3.0%	1.0%	5.0%	9.0%	13.0%
7.0%	$112.64	$145.51	$183.74	$228.00	$278.97
8.0%	$83.72	$110.18	$140.91	$176.42	$217.28
9.0%	$63.68	$85.71	$111.26	$140.75	$174.63
10.0%	$48.97	$67.76	$89.53	$114.61	$143.41
11.0%	$37.71	$54.04	$72.92	$94.65	$119.57

2 — Graham Number

Assumptions

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

EPS (trailing)($)Yahoo: $22.82

Book Value / share($)Yahoo: $33.43

Results

Graham Number$131.01

Current Price$563.40

Margin of Safety-76.7%

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

3 — Reverse DCF (Implied Growth)

Assumptions

WACC(%)Computed: 10.21%

Terminal growth rate(%)

Computed WACC: 10.21%

Cost of equity (Re)10.83%(Rf 4.30% + β 1.19 × ERP 5.50%)

Cost of debt (Rd)4.14%(interest expense ÷ avg debt (SEC))

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

Equity weight (E/V)91.78%

Debt weight (D/V)8.22%

Results

Current Price$563.40

Implied Near-term FCF Growth32.3%

Historical Revenue Growth-11.2%

Historical Earnings Growth-17.9%

Base FCF (TTM)$319.44M

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: $5.20

Dividend growth rate (g)(%)

Required return (r)(%)

Results

DDM Intrinsic Value / share$107.12

Current Price$563.40

Upside / Downside-81.0%

Formula: D0 × (1+g) / (r − g)

5 — EV/EBITDA Multiple

Assumptions

EBITDA($B)Yahoo: $1.15B

Target EV/EBITDA multipleCurrent: 18.5×

Net Debt($B)Default: $1.74B

Results

Implied Equity Value / share$563.41

Current Price$563.40

Upside / Downside+0.0%

Implied EV$21.34B

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

Mult \ Net Debt	$1.74B	$1.74B	$1.74B	$1.74B	$1.74B
14.5x	$430.68	$430.68	$430.68	$430.68	$430.68
16.5x	$497.04	$497.04	$497.04	$497.04	$497.04
18.5x	$563.41	$563.41	$563.41	$563.41	$563.41
20.5x	$629.77	$629.77	$629.77	$629.77	$629.77
22.5x	$696.13	$696.13	$696.13	$696.13	$696.13

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