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BlackRock, Inc.
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== Company Valuation == {| class="wikitable" | colspan="2" |'''DCF Assumptions & Output:''' | | | | | | | | | | | | |- | | | | | | | | | | | | | | |- | |'''Company Name:''' | |BlackRock | | colspan="3" |'''Terminal Value - Multiples Method:''' | | | colspan="4" |'''Terminal Value - Perpetuity Growth Method:''' |- | |'''Ticker:''' | |BLK | | | | | | | | | | |- | |'''Current Share Price:''' | |$ 745.74 | | colspan="3" |'''Median TEV / EBITDA of Comps:''' |14.0 x | | colspan="3" |'''Expected Long-Term GDP Growth:''' |1.80% |- | | | | | | colspan="3" |'''Baseline Terminal EBITDA Multiple:''' |17.4 x | | colspan="3" |'''Baseline Terminal FCF Growth Rate:''' |0.75% |- | |'''Discount Rate (WACC):''' | |10.10% | | | | | | | | | | |- | |'''Effective Tax Rate:''' | |22.0% | | colspan="2" |'''Baseline Terminal Value:''' | |$ 192,588 | | colspan="2" |'''Baseline Terminal Value:''' | |$ 192,875 |- | |'''Last Fiscal Year:''' | |2022-01-31 | | colspan="3" |'''Implied Terminal FCF Growth Rate:''' |0.74% | | colspan="3" |'''Implied Terminal EBITDA Multiple:''' |17.4 x |- | | | | | | | | | | | | | | |- | |'''Current Equity Value:''' | |$ 38,785 | | colspan="2" |'''(+) PV of Terminal Value:''' | | 119,034 | | colspan="2" |'''(+) PV of Terminal Value:''' | | 119,212 |- | |'''(-) Cash & Cash-Equivalents:''' | | (7,416) | | colspan="3" |'''(+) Sum of PV of Free Cash Flows:''' | 52,417 | | colspan="3" |'''(+) Sum of PV of Free Cash Flows:''' | 52,417 |- | |'''(-) Equity Investments:''' | | (533) | | colspan="2" |'''Implied Enterprise Value:''' | | 171,451 | | colspan="2" |'''Implied Enterprise Value:''' | | 171,628 |- | |'''(-) Other Non-Core Assets, Net:''' | | - | | | | | | | | | | |- | |'''(-) Net Operating Losses:''' | | (6,350) | | colspan="3" |'''% of Implied TEV from Terminal Value:''' |69.4% | | colspan="3" |'''% of Implied TEV from Terminal Value:''' |69.5% |- | |'''(+) Total Debt & Finance Leases:''' | | 8,492 | | | | | | | | | | |- | |'''(+) Preferred Stock:''' | | - | | colspan="2" |'''(+) Cash & Cash-Equivalents:''' | | 7,416 | | colspan="2" |'''(+) Cash & Cash-Equivalents:''' | | 7,416 |- | |'''(+) Noncontrolling Interests:''' | | 1,041 | | colspan="2" |'''(+) Equity Investments:''' | | 533 | | colspan="2" |'''(+) Equity Investments:''' | | 533 |- | |'''(+) Unfunded Pension Obligations:''' | | - | | colspan="3" |'''(+) Other Non-Core Assets, Net:''' | - | | colspan="3" |'''(+) Other Non-Core Assets, Net:''' | - |- | |'''Current Enterprise Value:''' | |$ 34,019 | | colspan="2" |'''(+) Net Operating Losses:''' | | 6,350 | | colspan="2" |'''(+) Net Operating Losses:''' | | 6,350 |- | | | | | | colspan="3" |'''(-) Total Debt & Capital Leases:''' | (8,492) | | colspan="2" |'''(-) Total Debt:''' | | (8,492) |- | | | | | | colspan="2" |'''(-) Preferred Stock:''' | | - | | colspan="2" |'''(-) Preferred Stock:''' | | - |- | | | | | | colspan="2" |'''(-) Noncontrolling Interests:''' | | (1,041) | | colspan="2" |'''(-) Noncontrolling Interests:''' | | (1,041) |- | | | | | | colspan="3" |'''(-) Unfunded Pension Obligations:''' | - | | colspan="3" |'''(-) Unfunded Pension Obligations:''' | - |- | | | | | | colspan="2" |'''Implied Equity Value:''' | | 176,217 | | colspan="2" |'''Implied Equity Value:''' | | 176,394 |- | | | | | | | | | | | | | | |- | | | | | | colspan="2" |'''Diluted Shares Outstanding:''' | | 150.2 | | colspan="2" |'''Diluted Shares Outstanding:''' | | 150.2 |- | | | | | | | | | | | | | | |- | | | | | | colspan="2" |'''Implied Share Price from DCF:''' | |$ 1,173.21 | | colspan="2" |'''Implied Share Price from DCF:''' | |$ 1,174.40 |- | | | | | | colspan="3" |'''Premium / (Discount) to Current:''' |57.3% | | colspan="3" |'''Premium / (Discount) to Current:''' |57.5% |} {| class="wikitable" | | | | | colspan="3" |Historical: | colspan="5" |Projected: |- | colspan="2" |'''Unlevered Free Cash Flow Projections:''' |Units: |FY19 |FY20 |FY21 |FY22 |FY23 |FY24 |FY25 |FY26 |FY27 |- | | | | | | | | | | | | |- | |'''AUM:''' |M |7,429,633 |8,676,680 |10,010,143 |8,594,485 |9,275,739 |10,017,557 |10,825,699 |11,563,964 |12,356,733 |- | |'''Equity''' |M |3,820,329 |4,419,806 |5,342,360 |4,435,354 |4,878,889 |5,366,778 |5,903,456 |6,375,733 |6,885,791 |- | |'''Growth Rate:''' |% |N/A |15.7% |20.9% |(17.0%) |10.0% |10.0% |10.0% |8.0% |8.0% |- | |'''Fixed Income''' |M |2,315,392 |2,674,488 |2,822,041 |2,536,823 |2,638,296 |2,743,828 |2,853,581 |2,967,724 |3,086,433 |- | |'''Growth Rate:''' |% |N/A |15.5% |5.5% |(10.1%) |4.0% |4.0% |4.0% |4.0% |4.0% |- | |'''Multi-asset''' |M |568,121 |658,733 |816,494 |684,904 |732,847 |784,147 |839,037 |880,989 |925,038 |- | |'''Growth Rate:''' |% |N/A |15.9% |23.9% |(16.1%) |7.0% |7.0% |7.0% |5.0% |5.0% |- | |'''Alternatives''' |M |178,072 |235,042 |264,881 |266,210 |300,817 |339,924 |384,114 |426,366 |473,266 |- | |'''Growth Rate:''' |% |N/A |32.0% |12.7% |0.5% |13.0% |13.0% |13.0% |11.0% |11.0% |- | |'''Cash Management''' |M |545,949 |666,252 |755,057 |671,194 |724,890 |782,881 |845,511 |913,152 |986,204 |- | |'''Growth Rate:''' |% |N/A |22.0% |13.3% |(11.1%) |8.0% |8.0% |8.0% |8.0% |8.0% |- | | | | | | | | | | | | |- | |'''Fees (For given AUM Performance)''' |Rev $ / AUM $ |0.159% |0.146% |0.152% |0.168% |0.173% |0.179% |0.185% |0.192% |0.198% |- | |'''Fees % on Equity;''' |Rev $ / AUM $ |0.150% |0.133% |0.150% |0.162% |0.167% |0.172% |0.177% |0.183% |0.188% |- | |'''Growth Rate:''' |% |N/A |(10.8%) |12.2% |8.4% |3.0% |3.0% |3.0% |3.0% |3.0% |- | |'''Fees % on Fixed Income;''' |Rev $ / AUM $ |0.119% |0.133% |0.146% |0.135% |0.139% |0.143% |0.147% |0.152% |0.156% |- | |'''Growth Rate:''' |% |N/A |11.8% |9.3% |(7.5%) |3.0% |3.0% |3.0% |3.0% |3.0% |- | |'''Fees % on Multi-asset''' |Rev $ / AUM $ |0.202% |0.177% |0.173% |0.190% |0.195% |0.201% |0.207% |0.213% |0.220% |- | |'''Growth Rate:''' |% |N/A |(12.6%) |(1.9%) |9.5% |3.0% |3.0% |3.0% |3.0% |3.0% |- | |'''Fees % on Alternatives;''' |Rev $ / AUM $ |0.567% |0.531% |0.571% |0.597% |0.609% |0.621% |0.634% |0.647% |0.659% |- | |'''Growth Rate:''' |% |N/A |(6.4%) |7.7% |4.6% |2.0% |2.0% |2.0% |2.0% |2.0% |- | |'''Fees % on Cash Management;''' |Rev $ / AUM $ |0.113% |0.119% |0.062% |0.129% |0.134% |0.139% |0.145% |0.151% |0.157% |- | |'''Growth Rate:''' |% |N/A |4.7% |(47.5%) |106.8% |4.0% |4.0% |4.0% |4.0% |4.0% |- | | | | | | | | | | | | |- | |'''COGS and OpEx per AUM:''' |$ / AUM $ | 0.001210 | 0.001211 | 0.001191 | 0.001336 | 0.001403 | 0.001473 | 0.001547 | 0.001624 | 0.001705 |- | |'''Growth Rate:''' |% |N/A |0.1% |(1.6%) |12.2% |5.0% |5.0% |5.0% |5.0% |5.0% |- | | | | | | | | | | | | |- | |'''Maintenance CapEx per AUM:''' |$ / AUM $ | 0.0000342 | 0.0000224 | 0.0000341 | 0.0000620 | 0.0000992 | 0.0001588 | 0.0002540 | 0.0004064 | 0.0006503 |- | |'''Growth Rate:''' |% |N/A |(34.6%) |52.4% |82.1% |60.0% |60.0% |60.0% |60.0% |60.0% |- | | | | | | | | | | | | |- | |'''D&A per AUM:''' |$ / AUM $ | 0.00003984 | 0.00004126 | 0.00004146 | 0.00004864 | 0.00005107 | 0.00005362 | 0.00005630 | 0.00005912 | 0.00006207 |- | |'''Growth Rate:''' |% |N/A |3.6% |0.5% |17.3% |5.0% |5.0% |5.0% |5.0% |5.0% |- | | | | | | | | | | | | |- | |'''Growth CapEx per New AUM:''' |$ / AUM $ | | | | | 0.00029 | 0.000299 | 0.000308 | 0.000315 | 0.000323 |- | |'''Growth Rate:''' |% | | | | | |3.0% |3.0% |2.5% |2.5% |- | | | | | | | | | | | | |- | |'''Tech and Advisory Services Growth Rate:''' |% |29.1% |15.4% |(16.8%) |15.0% |15.0% |15.0% |15.0% |15.0% |15.0% |- | | | | | | | | | | | | |- | |'''Revenue:''' | | | | | | | | | | |- | |'''(+) Equity Sales''' |$ M |$ 5,716 |$ 5,900 |$ 8,000 |$ 7,203 |$ 8,161 |$ 9,246 |$ 10,476 |$ 11,654 |$ 12,964 |- | |'''(+) Fixed Income Sales''' |$ M |$ 3,286 |$ 3,539 |$ 3,863 |$ 3,495 |$ 3,666 |$ 3,927 |$ 4,206 |$ 4,506 |$ 4,827 |- | |'''(+) Multi-asset Sales''' |$ M |$ 1,148 |$ 1,163 |$ 1,414 |$ 1,299 |$ 1,432 |$ 1,578 |$ 1,739 |$ 1,881 |$ 2,034 |- | |'''(+) Alternatives Sales''' |$ M |$ 1,009 |$ 1,247 |$ 1,513 |$ 1,590 |$ 1,833 |$ 2,112 |$ 2,435 |$ 2,756 |$ 3,121 |- | |'''(+) Cash Managment Sales''' |$ M |$ 618 |$ 790 |$ 470 |$ 864 |$ 970 |$ 1,090 |$ 1,224 |$ 1,375 |$ 1,545 |- | |'''(+) Net Sales:''' |$ M |$ 11,777 |$ 12,639 |$ 15,260 |$ 14,451 |$ 16,061 |$ 17,953 |$ 20,080 |$ 22,172 |$ 24,489 |- | |'''(+) Tech and Advisory Services:''' |$ M | 2,762 | 3,566 | 4,114 | 3,422 | 3,935 | 4,526 | 5,204 | 5,985 | 6,883 |- | |'''Total Revenue:''' |$ M | 14,539 | 16,205 | 19,374 | 17,873 | 19,997 | 22,479 | 25,285 | 28,157 | 31,372 |- | |'''Revenue Growth:''' |% |N/A |11.5% |19.6% |(7.7%) |11.9% |12.4% |12.5% |11.4% |11.4% |- | | | | | | | | | | | | |- | |'''Operating Income (EBIT):''' |$ M | 5,550 | 5,700 | 7,450 | 6,390 | 6,984 | 7,722 | 8,541 | 9,377 | 10,301 |- | |'''Operating (EBIT) Margin:''' |% |38.2% |35.2% |38.5% |35.8% |34.9% |34.4% |33.8% |33.3% |32.8% |- | | | | | | | | | | | | |- | |'''(-) Taxes, Excluding Effect of Interest:''' |$ M | (1,221) | (1,254) | (1,639) | (1,406) | (1,536) | (1,699) | (1,879) | (2,063) | (2,266) |- | | | | | | | | | | | | |- | |'''Net Operating Profit After Tax (NOPAT):''' |$ M | 4,329 | 4,446 | 5,811 | 4,984 | 5,447 | 6,024 | 6,662 | 7,314 | 8,035 |- | | | | | | | | | | | | |- | |'''Adjustments for Non-Cash Charges:''' | | | | | | | | | | |- | |'''(+) Depreciation & Amortization:''' |$ M | 296 | 358 | 415 | 418 | 474 | 537 | 610 | 684 | 767 |- | |'''% Revenue:''' |% |2.0% |2.2% |2.1% |2.3% |2.4% |2.4% |2.4% |2.4% |2.4% |- | | | | | | | | | | | | |- | |'''(+/-) Deferred Taxes:''' |$ M | 796 | 1,028 | 2,369 | 1,635 | 1,536 | 1,699 | 1,879 | 2,063 | 2,266 |- | |'''% Book Taxes:''' |% |65.2% |82.0% |144.5% |116.3% |100.0% |100.0% |100.0% |100.0% |100.0% |- | | | | | | | | | | | | |- | |'''(+/-) Other Operating Activities:''' |$ M | 1,243 | 1,331 | 1,450 | 1,527 | 1,616 | 1,816 | 2,043 | 2,275 | 2,535 |- | |'''% Revenue:''' |% |8.5% |8.2% |7.5% |8.5% |8.1% |8.1% |8.1% |8.1% |8.1% |- | | | | | | | | | | | | |- | |'''Change in Working Capital:''' | | | | | | | | | | |- | |'''Accounts Receivable:''' |$ M | 3,179 | 3,535 | 3,789 | 3,264 | | | | | |- | |'''Accounts Payable:''' |$ M | (1,167) | (1,028) | (1,379) | (1,294) | | | | | |- | |'''(+/-) Change in Working Capital: ''' |$ M | 2,012 | 2,507 | 2,410 | 1,970 | 2,364 | 2,837 | 3,404 | 4,085 | 4,902 |- | |'''% Change in Revenue:''' |% |N/A |150.5% |76.0% |(131.2%) |120.0% |120.0% |120.0% |120.0% |120.0% |- | | | | | | | | | | | | |- | |'''(-) Capital Expenditures:''' |$ M | (254) | (194) | (341) | (533) | (549) | (564) | (578) | (591) | (604) |- | |'''% Revenue:''' |% |1.7% |1.2% |1.8% |3.0% |2.7% |2.5% |2.3% |2.1% |1.9% |- | | | | | | | | | | | | |- | |'''Annual Unlevered Free Cash Flow:''' |$ M | 8,422 | 9,476 | 12,114 | 10,001 | 10,888 | 12,349 | 14,019 | 15,829 | 17,902 |- | |'''Growth Rate:''' |% |N/A |12.5% |27.8% |(17.4%) |8.9% |13.4% |13.5% |12.9% |13.1% |- | | | | | | | | | | | | |- | |'''Period:''' |# | | | | |1 |2 |3 |4 |5 |- | |'''PV of Unlevered FCF:''' |$ M | | | | | 9,889 | 10,187 | 10,504 | 10,772 | 11,065 |- | | | | | | | | | | | | |- | |'''EBITDA:''' |$ M |$ 5,846 |$ 6,058 |$ 7,865 |$ 6,808 |$ 7,457 |$ 8,260 |$ 9,150 |$ 10,060 |$ 11,068 |- | |'''Growth Rate:''' |% |N/A |N/A |29.8% |(13.4%) |9.5% |10.8% |10.8% |9.9% |10.0% |} {| class="wikitable" | colspan="2" |'''Discount Rate Calculations - Assumptions:''' | | | | | | |- |'''Risk-Free Rate:''' | |3.90% | | | | | |- |'''Equity Risk Premium:''' | |5.00% | | | | | |- |'''Pre-Tax Cost of Debt:''' | |3.73% | | | | | |- |'''Cost of Preferred Stock:''' | |– | | | | | |- | |'''Debt''' |'''% Debt''' |'''Stock''' |'''% Preferred''' |'''Equity''' |'''% Equity''' |'''Beta''' |- |'''Current Capital Structure:''' |$ 1,073 |2.7% |$ - |– |$ 38,785 |97.3% | 1.28 |- |'''Cost of Equity Based on Historical Beta:''' | | | | | | |10.30% |- |'''WACC, Current Capital Structure:''' | | | | | | |10.10% |} ==== Ratios ==== {| class="wikitable" | |'''Mkt Cap (USD)''' |'''BF P/E''' |'''BF EV/EBITDA''' |'''BF EV/EBIT''' |'''BF EV/Rev''' |'''LF P/BV''' |- |'''BlackRock''' |109.89B |19.1x |14.4x |15.5x |5.9x |2.9x |- |'''Mean from Comps''' |8.94B |12.3x |8.7x |9.7x |3.2x |2.1x |}
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