Brunswick Corporation manufactures recreation products, like boats, boat engines, and fitness and billiards products. The company was founded in 1845 and is based in Lake Forest, Illinois.
BC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for BC, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Brunswick Corp ranked in the 56th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 84.17% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for BC, they are:
Brunswick Corp's effective tax rate, as measured by taxes paid relative to net income, is at 76 -- greater than 96.68% of US stocks with positive free cash flow.
Brunswick Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 0.33. This coverage rate is greater than that of just 20.02% of stocks we're observing for the purpose of forecasting via discounted cash flows.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than 81.91% of stocks in its sector (Consumer Cyclical).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as BC, try ADNT, DBI, GPS, BBY, and ICON.