2019 end of year tipping comp !!, page-105

Nice if forecast price for 2019 is with any supportive link. As below $2.30 is the target price. I may be wrong in interpreting and not sure if this is for the 2019 or 2023 range? This site is 14 days free so have a look at it.

link. https://**.st/stocks/au/materials/asx-pls/pilbara-minerals-shares


Below are the data sources, inputs and calculation used to determine the intrinsic value for Pilbara Minerals.

	{caption}ASXLS Discounted Cash Flow Data Sources{/caption}
1	Data Point	Source	Value
2	Valuation Model		2 Stage Free Cash Flow to Equity
3	Levered Free Cash Flow	Average of 6 Analyst Estimates (S&P Global)	See below
4	Discount Rate (Cost of Equity)	See below	10.2%
5	Perpetual Growth Rate	10-Year AU Government Bond Rate	2.8%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

	{caption}Calculation of Discount Rate/ Cost of Equity for ASXLS{/caption}
1	Data Point	Calculation/ Source	Result
2	Risk-Free Rate	10-Year AU Govt Bond Rate	2.8%
3	Equity Risk Premium	S&P Global	7.2%
4	Metals and Mining Unlevered Beta	Simply Wall St/ S&P Global	0.95
5	Re-levered Beta	= Unlevered beta (1 + (1- tax rate) (Debt/Equity)) = 0.951 (1 + (1- 30%) (12.03%))	1.031
6	Levered Beta	Levered Beta limited to 0.8 to 2.0(practical range for a stable firm)	1.03
7	Discount Rate/ Cost of Equity	= Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium) = 2.77% + (1.031 * 7.23%)	10.22%

Discounted Cash Flow Calculation for ASXLS using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for Pilbara Minerals is arrived at by discounting future cash flows to their present value using the 2 stage method. We use analyst's estimates of cash flows going forward 5 years for the 1st stage, the 2nd stage assumes the company grows at a stable rate into perpetuity.

	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6
0	{caption}ASXLS DCF 1st Stage: Next 5 year cash flow forecast{/caption}
1		2019	2020	2021	2022	2023
2	Levered FCF (AUD, Millions)[/B]	-72.10	129.90	364.50	330.00	382.80
3	Source	Analyst x2	Analyst x2	Analyst x2	Analyst x1	Est @ 16%, capped from 123.25%
4	Present ValueDiscounted (@ 10.22%)	-65.41	106.92	272.20	223.58	235.30
5	Present value of next 5 years cash flows	A$772.59

	{caption}ASXLS DCF 2nd Stage: Terminal Value{/caption}
1		Calculation	Result
2	Terminal Value	= FCF2023 × (1 + g) ÷ (Discount Rate – g) = A$382.80 × (1 + 2.77%) ÷ (10.22% – 2.77%)	A$5,281.79
3	Present Value of Terminal Value	= Terminal Value ÷ (1 + r)5 = A$5,281.79 ÷ (1 + 10.22%)5	A$3,246.59

	{caption}ASXLS Total Equity Value{/caption}
1		Calculation	Result
2	Total Equity Value	= Present value of next 5 years cash flows + Terminal Value = A$772.59 + A$3,246.59	A$4,019.18
3	Equity Value per Share(AUD)	= Total value / Shares Outstanding = A$4,019.18 / 1,744.51	A$2.3

	{caption}ASXLS Discount to Share Price{/caption}
1		Calculation	Result
2	Value per share (AUD)	From above.	A$2.30
3	Current discount	Discount to share price of A$0.63 = -1 x (A$0.63 - A$2.30) / A$2.30	72.9%