What is Beazer Homes USA Inc worth?
With the base-case assumptions below, a discounted cash flow model on Beazer Homes USA Inc's reported free cash flow gives $6.06 per share.
Inputs from the filings
Three sets of assumptions
| Case | Growth yrs 1-5 | Discount rate | Value per share | Value vs price |
|---|---|---|---|---|
| Bear | -3.0% | 10.0% | $5.38 | - |
| Base | 2.0% | 9.0% | $6.06 | - |
| Bull | 7.0% | 8.0% | $7.32 | - |
Sensitivity: base case value per share
| 1.5% | 2.0% | 2.5% | 3.0% | 3.5% | |
|---|---|---|---|---|---|
| 7.0% | $6.53 | $6.67 | $6.85 | $7.07 | $7.35 |
| 8.0% | $6.18 | $6.27 | $6.38 | $6.51 | $6.67 |
| 9.0% | $5.92 | $5.98 | $6.06 | $6.14 | $6.24 |
| 10.0% | $5.72 | $5.77 | $5.82 | $5.88 | $5.94 |
| 11.0% | $5.57 | $5.60 | $5.64 | $5.68 | $5.73 |
Where the presets come from
Base: years 1 to 5 grow at Beazer Homes USA Inc's revenue growth rate over the last 5 fiscal years (2.2% a year), held between -5% and 15%. Years 6 to 10 grow halfway between that and the long-run rate of 2.5%. Future cash is discounted at 9% a year.
Bear: 5 points less growth, 2% long-run growth, 10% discount rate. Bull: 5 points more growth (at most 25%), 3% long-run growth, 8% discount rate.
Value per share = (present value of 10 years of free cash flow + present value of everything after + cash - debt) / diluted shares.
This is a model run on assumptions, not a recommendation or a price target. Small changes in the discount rate or growth move the result a lot, as the table above shows. Change them yourself in the calculator.
Adjust the assumptions
Move the sliders for growth, long-run growth and discount rate, or switch to average free cash flow, and see the value per share change.
Adjust the assumptions