In this article I am going to calculate the intrinsic value of Telstra Corporation Limited (ASX:TLS) using the discounted cash flows (DCF) model. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. Also note that this article was written in December 2017 so be sure check the latest calculation for Telstra here.
What’s the value?
I will be using the 2-stage growth model, which simply means we take in account two stages of company’s growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have perpetual stable growth rate. Firstly, I use the analyst consensus estimates of TLS’s levered free cash flow (FCF) over the next five years and discounted these values at the cost of equity of 8.55%. This resulted in a present value of 5-year cash flow of A$14,511.4M. Keen to understand how I arrived at this number? Check out our detailed analysis here.
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Last
$4.86 |
Change
-0.020(0.41%) |
Mkt cap ! $55.49B | |||
| Open | High | Low | Value | Volume |
| $4.88 | $4.91 | $4.85 | $101.2M | 20.76M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 6 | 294751 | $4.85 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $4.87 | 213089 | 4 |
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| Last trade - 16.13pm 24/06/2025 (20 minute delay) ? |
| TLS (ASX) Chart |