Open main menu
Home
Random
Donate
Recent changes
Special pages
Community portal
Preferences
About Stockhub
Disclaimers
Search
User menu
Talk
Contributions
Create account
Log in
Editing
Ryanair Holdings plc
(section)
Warning:
You are not logged in. Your IP address will be publicly visible if you make any edits. If you
log in
or
create an account
, your edits will be attributed to your username, along with other benefits.
Anti-spam check. Do
not
fill this in!
=== Discounted Cash Flow Analysis === ===== Historical Cash Flows: ===== Ryan Air's annual free cash flows from the past 10 years<ref><nowiki>https://www.macrotrends.net/stocks/charts/RYAAY/ryanair-holdings/free-cash-flow</nowiki></ref>: {| class="wikitable" !Year !Annual Free Cashflow (£ Mn) |- |2023 |2,063.22 |- |2022 |1,010.68 |- |2021 |(3,072.54) |- |2020 |831.96 |- |2019 |545.19 |- |2018 |892.85 |- |2017 |523.90 |- |2016 |1,133.79 |- |2015 |1,143.06 |- |2014 |722.26 |- |2013 |918.44 |- |2012 |1,006.38 |- |2011 |(146.75) |- |2010 |52.45 |- |2009 |36.00 |} ===== Projected Cash Flows: ===== Projected cash flow values for the next 10 years, based on an earnings growth prediction rate of 12.3%<ref>[https://simplywall.st/stocks/ie/transportation/ise-rya/ryanair-holdings-shares/future#:~:text=Ryanair%20Holdings%20is%20forecasted%20to,be%2025.3%25%20in%203%20years. https://simplywall.st/stocks/ie/transportation/ise-rya/ryanair-holdings-shares/future#:~:text=Ryanair%20Holdings%20is%20forecasted%20to,be%2025.3%25%20in%203%20years.]</ref>: {| class="wikitable" !Year !Projected cash flow (£Mn) |- |2024 |2,317.00 |- |2025 |2,601.99 |- |2026 |2,922.03 |- |2027 |3,281.44 |- |2028 |3,685.06 |- |2029 |4,138.32 |- |2030 |4,647.33 |- |2031 |5,218.96 |- |2032 |5,860.89 |- |2033 |6,581.78 |} ===== Determining a Discount Rate: ===== A WACC value was calculated as follows: ''UK 10 Year Government Bond Yield = 4.43% (government data)'' ''Beta value = 1.45''<ref>https://finance.yahoo.com/quote/RYAAY/?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAA-QsnB5Z3NE6_hbXttVYrUnEYFEWtxrdExBHRP0wG2Rwy_Q5T0mlSLNPF2WwFhQbDYfevMryfNXYe8P_oYpm8Xt7ytyiQCF8KpRHed-kXXUK8BorxHOIxb-yyG92X5Dx2IfOOw3sPZlEWgKeH5FetsTHRtMu9XR-g5kdP4aoX-1</ref> ''Assumed market return premium = 6% (government data)'' WACC = [risk-free rate] + [beta value * assumed market return premium] WACC = [4.43%] + [1.45 * 6%] WACC = 13.13% ===== Present value of predicted future cash flows: ===== The present value of each predicted cash flow (over the next 10 years), after the discount rate had been applied as follows: Present value of cash flow = { predicted cash flow } / { (1 + WACC)^(number of years) } {| class="wikitable" !Year !Present value of predicted cash flow (£Mn) |- |2024 |2,048.08 |- |2025 |2,033.06 |- |2026 |2,018.14 |- |2027 |2,003.33 |- |2028 |1,988.64 |- |2029 |1,974.05 |- |2030 |1,959.56 |- |2031 |1,945.19 |- |2032 |1,930.92 |- |2033 |1,916.75 |} ===== Net present / intrinsic value of Ryan Air: ===== The net present value was calculated by summing the present values of predicted cash flows over the next 10 years: Net present value = £19 817.71 Mn (£19.82 Bn) ===== Comparison with present market cap of Ryan Air: ===== Given that the net present value (£19.82 Bn) calculated from the DCF analysis is less than the current market cap of Ryan Air (£18.98 Bn - as of October 2023<ref>[https://companiesmarketcap.com/ryanair/marketcap/#:~:text=Market%20cap%3A%20%2422.31%20Billion,cap%20according%20to%20our%20data. https://companiesmarketcap.com/ryanair/marketcap/#:~:text=Market%20cap%3A%20%2422.31%20Billion,cap%20according%20to%20our%20data.]</ref>) - it is possible that Ryan Air is ''potentially undervalued'', calling for a sensitivity analysis to be carried out.
Summary:
Please note that all contributions to Stockhub may be edited, altered, or removed by other contributors. If you do not want your writing to be edited mercilessly, then do not submit it here.
You are also promising us that you wrote this yourself, or copied it from a public domain or similar free resource (see
Stockhub:Copyrights
for details).
Do not submit copyrighted work without permission!
Cancel
Editing help
(opens in new window)