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Ratio analysis

Profit Margin Financial assessment

For the Fiscal year of 2019 2020 2021 2019 2020 2021

Net Income($M) -862 721 5519 Profit Margin -0.0351 0.0229 0.1025

Sales($M) 24578 31536 53823 Asset Turnover 0.7164 0.6047 0.8663

Profit Margin -0.0351 0.0229 0.1025 Equity Multiplier 4.2305 2.2023 1.9672

ROE -0.1063 0.0304 0.1747

Current ratio 1.1346 1.8751 1.3753

Interest Coverage ratio 0.1103 2.4885 18.2207

Asset Turnover

For the Fiscal year of 2019 2020 2021

Sales($M) 24578 31536 53823

Total Assets($M) 34309 52148 62131

Asset Turnover 0.7164 0.6047 0.8663

Equity Multiplier

For the Fiscal year of 2019 2020 2021

Total Assets($M) 34309 52148 62131

Book Value of Equity 8110 23679 31583

Equity Multiplier 4.2305 2.2023 1.9672

ROE

For the Fiscal year of 2019 2020 2021

Profit Margin -0.0351 0.0229 0.1025

Asset Turnover 0.7164 0.6047 0.8663

Equity Multiplier 4.2305 2.2023 1.9672

ROE -10.63% 3.04% 17.47%

Revenue & Profit

2019 2020 2021 CAGR

Revenue 24578 31536 53823 29.86%

Gross Profit 4069 6630 13606

Gross profit total automotive 4423 6977 13839

Gross profit total automotive & services and other segment 3879 6612 13735

Gross profit energy generation and storage segment 190 18 -129

Margins

For the Fiscal year of 2019 2020 2021

Gross margin total automotive 21.20% 25.60% 29.30%

Gross margin total automotive & services and other segment 16.80% 22.40% 26.90%

Gross margin energy generation and storage segment 12.40% 0.90% -4.60%

Total gross margin 16.60% 21.00% 25.30%

ROA

For the Fiscal year of 2019 2020 2021

ROA -2.5% 1.4% 8.9%

Financial Performance of Tesla

Profit Margin 2019 2020 2021 -3.5072015623728539E-2 2.2862760020294266E-2 0.10253980640246735 Asset Turnover 2019 2020 2021 0.71637179748753976 0.60474035437600671 0.86628253206933736 Equity Multiplier 2019 2020 2021 4.2304562268803947 2.2022889480130075 1.9672292055852831 ROE 2019 2020 2021 -0.10628853267570901 3.0448920984838885E-2 0.17474590760852354 Current ratio 2019 2020 2021 1.1346207931002157 1.8751403705783267 1.3752854605430094 Interest Coverage ratio 2019 2020 2021 0.1103448275862069 2.4885204081632653 18.220670391061454

Profits Analyse

Gross profit total automotive Revenue & Profit 4423 6977 13839 Gross profit total automotive & services and other segment Revenue & Profit 3879 6612 13735 Gross profit energy generation and storage segment Revenue & Profit 190 18 -129 Gross Profit 4069 6630 13606

Revenue Analyse

Revenue 2019 2020 2021 24578 31536 53823

Margins Analyse

Gross margin total automotive 2019 2020 2021 0.21199999999999999 0.25600000000000001 0.29299999999999998 Gross margin total automotive & services and other segment 2019 2020 2021 0.16800000000000001 0.224 0.26900000000000002 Gross margin energy generation and storage segment 2019 2020 2021 0.124 8.9999999999999993E-3 -4.5999999999999999E-2 Total gross margin 2019 2020 2021 0.16600000000000001 0.21 0.253

Industry analysis

Profitablitiy analysis

Name Profit Margin Asset Turnover Equity Multiplier Current ratio Interest coverage ratio

TSLA Tesla 13.50% 0.87 1.97 1.35 18.2

TM Toyota Motor 9.99% 0.12 2.56 1.07 85.32

F Ford Motor Company 8.59% 0.14 5.56 1.17 1.62

GM General Motors Company 7.61% 0.15 4.00 1.11 9.72

HMC Honda Motor Company Ltd. 5.56% 0.16 2.27 1.38 70.8

RACE Ferrari N.V. Common Shares 19.45% 0.17 3.13 1.92 0

LCID Lucid Group 0.00% 0 2.00 0.1643 0

RIVN Rivian Automotive 0.00% 0 1.14 14.14 0

NIO Nio Auto -29.26% 0.13 2.38 2.18 0

LI Li Auto -1.19% 0.18 1.52 4.33 2.49

Peer Comparisons

Name Revenue Gross Profit Profit Margin ROE ROA

TSLA Tesla 62190 13610 13.50% 28.26% 10.12%

TM Toyota Motor 30960000 4830000 9.99% 13.06% 3.31%

F Ford Motor Company 134590 16510 8.59% 29.17% 2.27%

GM General Motors Company 130510 18080 7.61% 16.03% 2.61%

HMC Honda Motor Company Ltd. 14300000 2730000 5.56% 6.19% 5.56%

RACE Ferrari N.V. Common Shares 4270 2190 19.45% 41.65% 19.45%

LCID Lucid Group 27.11 -127.79 0.00% -101.35% -20.60%

RIVN Rivian Automotive 55 -465 0.00% -40.11% -19.61%

NIO Nio Auto 36140 6820 -29.26% -30.33% -29.26%

LI Li Auto 27010 5760 -1.19% -0.91% 1.29%

Liquidity Analysis

Name Asset Turnover Current ratio Interest coverage ratio

TSLA Tesla 0.87 1.35 18.2

TM Toyota Motor 0.12 1.07 85.32

F Ford Motor Company 0.14 1.17 1.62

GM General Motors Company 0.15 1.11 9.72

HMC Honda Motor Company Ltd. 0.16 1.38 70.8

RACE Ferrari N.V. Common Shares 0.17 1.92 0

LCID Lucid Group 0 0.1643 0

RIVN Rivian Automotive 0 14.14 0

NIO Nio Auto 0.13 2.18 0

LI Li Auto 0.18 4.33 2.49

Cash flow analysis

Overall cash flow & Quality of earnings

2019 2020 2021

Cash from operation Exclude SBC($M) 2405 5943 11497

Cash fron investing -1436 -3132 -7868

Cash from financing 1529 9973 -5203

Net Income($M) -862 721 5519

Sales 24578 31536 53823

Net change in cash 2506 13118 -1757

Operating cash index -0.4142 5.0929 1.5833

Working capital management

2019 2020 2021

Change in inventories -429 -422 -1709

Change in Acc. Payable 646 2102 4578

Change in Other Net Operating Assets -1000 -1165 -3014

Net working capital 1436 12469 7395

Capital expenditure

2019 2020 2021

Capital expenditure 1432 3232 8014

Depreciation 2048 2271 2759

Working capital management

Change in inventories 2019 2020 2021 -429 -422 -1709 Change in Acc. Payable 2019 2020 2021 646 2102 4578 Change in Other Net Operating Assets 2019 2020 2021 -1000 -1165 -3014 Net working capital
2019 2020 2021 1436 12469 7395

Operating Cash Index

Cash from operation Exclude SBC($M) 2019 2020 2021 2405 5943 11497 Net Income($M) 2019 2020 2021 -862 721 5519 Operating cash index
2019 2020 2021 -0.41415313225058004 5.0929264909847438 1.5832578365645951

Overall cash flow

Cash from operation Exclude SBC($M) 2019 2020 2021 2405 5943 11497 Cash fron investing 2019 2020 2021 -1436 -3132 -7868 Cash from financing 2019 2020 2021 1529 9973 -5203 Net change in cash 2019 2020 2021 2506 13118 -1757

Capex

Capital expenditure 2019 2020 2021 1432 3232 8014 Depreciation 2019 2020 2021 2048 2271 2759

DCF Approach-Income Statement

Tesla, Inc. (TSLA)

Income statement Projections

2019 2020 2021 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

Revenue

Sales 24578.00 31536.00 53823.00 83425.65 108453.35 138820.28 177689.96 222112.45 277640.56 333168.68 399802.41 439782.65 483760.92

Growth rate 28.31% 70.67% 55.00% 30.00% 28.00% 28.00% 25.00% 25.00% 20.00% 20.00% 10.00% 10.00%

Total Revenue 24578.00 31536.00 53823.00 83425.65 108453.35 138820.28 177689.96 222112.45 277640.56 333168.68 399802.41 439782.65 483760.92

Expenses

COGS 20509 24906 40217 58397.96 70494.67 90233.18 106613.98 133267.47 166584.34 199901.21 239881.45 263869.59 290256.55

% of sales 83.4% 79.0% 74.7% 70.0% 65.0% 65.0% 60.0% 60.0% 60.0% 60.0% 60.0% 60.0% 60.0%

Total Operating Expenses 20509.00 24906.00 40217.00 58397.96 70494.67 90233.18 106613.98 133267.47 166584.34 199901.21 239881.45 263869.59 290256.55

Gross Profit 4069.00 6630.00 13606.00 25027.70 37958.67 48587.10 71075.98 88844.98 111056.23 133267.47 159920.96 175913.06 193504.37

70.0% 65.0% 65.0% 60.0% 60.0% 60.0% 60.0% 60.0% 60.0% 60.0%

Other Expenses 30.0% 35.0% 35.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%

SG&A 2646.00 3188.00 4517.00 5839.80 7591.73 9717.42 12438.30 13326.75 16658.43 19990.12 23988.14 26386.96 29025.66

% of sales 10.77% 10.11% 8.39% 7.00% 7.00% 7.00% 7.00% 6.00% 6.00% 6.00% 6.00% 6.00% 6.00%

R&D 1343 1491 2593 4174.01 5426.21 6945.55 8890.31 11112.89 13891.11 16669.33 20003.19 22003.51 24203.86

% of sales 5.46% 4.73% 4.82% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%

Deprecation 2092 2322 2810 2502.77 3253.60 4164.61 5330.70 6663.37 8329.22 9995.06 11994.07 13193.48 14512.83

% of sales 8.51% 7.36% 5.22% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00%

Total other expenses 6081.16 7001.15 9920.13 12516.70 16271.67 20827.70 26659.42 31103.12 38878.87 46654.62 55985.52 61584.06 67742.46

Total Expenses 26590.16 31907.15 50137.13 70914.65 86766.34 111060.88 133273.40 164370.59 205463.21 246555.82 295866.97 325453.65 357999.01

Operating Income -2012.16 -371.15 3685.87 12511.00 21687.00 27759.40 44416.56 57741.86 72177.36 86612.85 103935.44 114329.00 125761.91

Interest Expense -725.00 -784.00 -358.00 -417.13 -542.27 -694.10 -888.45 -1110.56 -1388.20 -1665.84 -1999.01 -2198.91 -2418.80

% of salses -2.95% -2.49% -0.67% -0.5% -0.5% -0.5% -0.5% -0.5% -0.5% -0.5% -0.5% -0.5% -0.5%

Invest.Income 44.00 30.00 56.00 83.43 108.45 138.82 177.69 222.11 277.64 333.17 399.80 439.78 483.76

% of salses 0.18% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%

Other Non-Operating Income 37.00 28.00 25.00 25.03 32.54 41.65 53.31 66.63 83.29 99.95 119.94 131.93 145.13

% of salses 0.15% 0.09% 0.05% 0.03% 0.03% 0.03% 0.03% 0.03% 0.03% 0.03% 0.03% 0.03% 0.03%

EBIT -2656.16 -1097.15 3408.87 12202.32 21285.73 27245.76 43759.11 56920.05 71150.09 85380.13 102456.18 112701.80 123972.00

Effective Tax rate 8.89% 9.54% 11.00% 11% 11% 11% 11% 11% 11% 11% 11% 11% 11%

EBIT(1-τ) (Net Income) -2420.03 -992.48 3033.89 10860.07 18944.30 24248.73 38945.61 50658.84 63323.58 75988.31 91186.00 100304.61 110335.08

-0.10 -0.03 0.06 0.13 0.17 0.17 0.22 0.23 0.23 0.23 0.23 0.23 0.23

Projected Shares outstanding(M) 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030

EPS -2.35 -0.96 2.95 10.54 18.39 23.54 37.81 49.18 61.48 73.78 88.53 97.38 107.12

DCF-Balance Sheet+Cash flow

as % of revenues

Balance Sheet Assumptions

2019 2020 2021 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

Assets

Current Assets

Cash And Equivalents 25.50% 61.47% 32.66% 39.87% 39.87% 39.87% 39.87% 39.87% 39.87% 39.87% 39.87% 39.87% 39.87%

Accounts Receivable 5.39% 6.03% 3.69% 5.04% 5.04% 5.04% 5.04% 5.04% 5.04% 5.04% 5.04% 5.04% 5.04%

Inventory 14.45% 13.00% 10.70% 12.72% 12.72% 12.72% 12.72% 12.72% 12.72% 12.72% 12.72% 12.72% 12.72%

Prepaid Exp. 2.90% 3.46% 2.42% 2.93% 2.93% 2.93% 2.93% 2.93% 2.93% 2.93% 2.93% 2.93% 2.93%

Restricted Cash 1.00% 0.75% 0.64% 0.80% 0.80% 0.80% 0.80% 0.80% 0.80% 0.80% 0.80% 0.80% 0.80% $

Non-current Assets

Net Property, Plant & Equipment 82.18% 74.12% 57.92% 71.41% 71.41% 71.41% 71.41% 71.41% 71.41% 71.41% 71.41% 71.41% 71.41%

Goodwill 0.81% 0.66% 0.37% 0.61% 0.61% 0.61% 0.61% 0.61% 0.61% 0.61% 0.61% 0.61% 0.61%

Other Intangibles 1.38% 0.99% 0.48% 0.95% 0.95% 0.95% 0.95% 0.95% 0.95% 0.95% 0.95% 0.95% 0.95%

Accounts Receivable Long-Term – 0.23% 0.56% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%

Other Long-Term Assets 5.98% 4.64% 5.75% 5.45% 5.45% 5.45% 5.45% 5.45% 5.45% 5.45% 5.45% 5.45% 5.45%

Liabilities

Current Liabilities CAPEX Assumptions

Accounts Payable 15.34% 19.19% 18.63% 17.72% 17.72% 17.72% 17.72% 17.72% 17.72% 17.72% 17.72% 17.72% 17.72% 2019 2020 2021 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

Accrued Exp. 4.84% 5.18% 5.51% 5.18% 5.18% 5.18% 5.18% 5.18% 5.18% 5.18% 5.18% 5.18% 5.18% CAPEX -5.83% -10.25% -14.89% -10.32% -10.32% -10.32% -10.32% -10.32% -10.32% -10.32% -10.32% -10.32% -10.32%

Curr. Port. of LT Debt 5.69% 5.57% 2.02% 4.43% 4.43% 4.43% 4.43% 4.43% 4.43% 4.43% 4.43% 4.43% 4.43%

Curr. Port. of Leases 2.50% 2.09% 1.61% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07% 2.07%

Curr. Income Taxes Payable 2.49% 2.46% 2.08% 2.34% 2.34% 2.34% 2.34% 2.34% 2.34% 2.34% 2.34% 2.34% 2.34%

Unearned Revenue, Current 4.73% 4.62% 2.69% 4.01% 4.01% 4.01% 4.01% 4.01% 4.01% 4.01% 4.01% 4.01% 4.01%

Other Current Liabilities 7.81% 6.06% 4.06% 5.98% 5.98% 5.98% 5.98% 5.98% 5.98% 5.98% 5.98% 5.98% 5.98%

Non-current Liabilities

Long-Term Debt 42.21% 27.18% 7.96% 25.78% 25.78% 25.78% 25.78% 25.78% 25.78% 25.78% 25.78% 25.78% 25.78%

Long-Term Leases 8.90% 7.45% 4.95% 7.10% 7.10% 7.10% 7.10% 7.10% 7.10% 7.10% 7.10% 7.10% 7.10%

Unearned Revenue, Non-Current 4.91% 4.07% 3.81% 4.26% 4.26% 4.26% 4.26% 4.26% 4.26% 4.26% 4.26% 4.26% 4.26%

Def. Tax Liability, Non-Curr. 0.27% 0.48% 0.04% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26% 0.26%

Other Non-Current Liabilities 6.90% 5.92% 3.38% 5.40% 5.40% 5.40% 5.40% 5.40% 5.40% 5.40% 5.40% 5.40% 5.40%

Cash flow statement Projection

Balance Sheet Projection 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

2019 2020 2021 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E Cash from operation activities

Assets Net Income 10,860.07 18,944.30 24,248.73 38,945.61 50,658.84 63,323.58 75,988.31 91,186.00 100,304.61 110,335.08

Current Assets Depreciation & Amort. 2,502.77 3,253.60 4,164.61 5,330.70 6,663.37 8,329.22 9,995.06 11,994.07 13,193.48 14,512.83

Cash And Equivalents 6268.00 19384.00 17576.00 33265.68 43245.38 55354.09 70853.24 88566.55 110708.18 132849.82 159419.78 175361.76 192897.94 (Increase)Decrease in Acc.Receivables (2,216.20) (1,260.66) (1,529.60) (1,957.89) (2,237.59) (2,796.98) (2,796.98) (3,356.38) (2,013.83) (2,215.21)

Accounts Receivable 1324.00 1903.00 1986.00 4202.20 5462.86 6992.46 8950.35 11187.94 13984.92 16781.90 20138.28 22152.11 24367.32 (Increase)Decrease in Inventories (4,852.60) (3,182.88) (3,861.90) (4,943.23) (5,649.40) (7,061.75) (7,061.75) (8,474.10) (5,084.46) (5,592.91)

Inventory 3552.00 4101.00 5757.00 10609.60 13792.48 17654.38 22597.61 28247.01 35308.76 42370.51 50844.61 55929.07 61521.98 (Increase)Decrease in Prepaid Expense (1,138.01) (732.90) (889.26) (1,138.25) (1,300.86) (1,626.07) (1,626.07) (1,951.28) (1,170.77) (1,287.85)

Prepaid Exp. 713.00 1091.00 1305.00 2443.01 3175.92 4065.18 5203.43 6504.28 8130.35 9756.42 11707.71 12878.48 14166.33 (Increase)Decrease in Restricted Cash (321.45) (199.94) (242.59) (310.51) (354.87) (443.59) (443.59) (532.31) (319.39) (351.32)

Restricted Cash 246.00 238.00 345.00 666.45 866.39 1108.98 1419.49 1774.37 2217.96 2661.55 3193.86 3513.24 3864.57 Increase(Decrease) in Acc.Payable 4,757.04 4,434.61 5,380.66 6,887.25 7,871.14 9,838.92 9,838.92 11,806.71 7,084.03 7,792.43

Total Current Assets 12103.00 26717.00 26969.00 51186.95 66543.04 85175.08 109024.11 136280.14 170350.17 204420.20 245304.24 269834.67 296818.14 Increase(Decrease) in Accrued Exp. 1,295.54 1,571.92 2,012.06 2,299.50 2,874.37 2,874.37 3,449.25 2,069.55 2,276.50 (25,041.53)

Non-current Assets Increase(Decrease) in Unearned Revenue 1,902.15 1,004.75 1,219.09 1,560.44 1,783.36 2,229.20 2,229.20 2,675.03 1,605.02 1,765.52

Net Property, Plant & Equipment 20199.00 23375.00 31176.00 59573.72 77445.84 99130.68 126887.27 158609.08 198261.35 237913.62 285496.35 314045.98 345450.58 Increase(Decrease) in Tax Payable 834.17 586.85 712.05 911.42 1,041.62 1,302.03 1,302.03 1,562.43 937.46 1,031.21

Goodwill 198.00 207.00 200.00 509.89 662.86 848.46 1086.03 1357.54 1696.92 2036.30 2443.57 2687.92 2956.71 Increase(Decrease) in Other Current Liabilities 2,800.19 1,496.16 1,815.34 2,323.63 2,655.58 3,319.48 3,319.48 3,983.37 2,390.02 2,629.02

Other Intangibles 339.00 313.00 257.00 792.35 1030.05 1318.46 1687.63 2109.54 2636.93 3164.31 3797.18 4176.89 4594.58 Total 16,423.66 25,915.80 33,029.19 49,908.66 64,005.57 79,288.39 94,193.85 110,963.09 119,202.67 103,577.27

Accounts Receivable Long-Term 0.00 74.00 303.00 332.71 432.52 553.62 708.64 885.79 1107.24 1328.69 1594.43 1753.87 1929.26

Other Long-Term Assets 1469.00 1462.00 3095.00 4550.37 5915.48 7571.81 9691.92 12114.90 15143.62 18172.34 21806.81 23987.49 26386.24 Cash from investing activities

Total non-current Assets 22205.00 25431.00 35031.00 65759.03 85486.74 109423.03 140061.48 175076.85 218846.06 262615.28 315138.33 346652.16 381317.38 CAPEX (8,610.78) (11,194.01) (14,328.33) (18,340.27) (22,925.34) (28,656.67) (34,388.00) (41,265.60) (45,392.16) (49,931.38)

(Increase)Decrease in Other Long-Term Assets (1,455.37) (1,365.11) (1,656.33) (2,120.11) (2,422.98) (3,028.72) (3,028.72) (3,634.47) (2,180.68) (2,398.75)

Total Assets 34308.00 52148.00 62000.00 116945.98 152029.78 194598.12 249085.59 311356.99 389196.23 467035.48 560442.58 616486.83 678135.52 Total (10,066.14) (12,559.12) (15,984.67) (20,460.38) (25,348.31) (31,685.39) (37,416.73) (44,900.07) (47,572.85) (52,330.13)

Liabilities

Current Liabilities Cash from financing activities

Accounts Payable 3771.00 6051.00 10025.00 14782.04 19216.65 24597.31 31484.56 39355.70 49194.62 59033.55 70840.26 77924.28 85716.71 Long term debt 17,225.55 6,453.17 7,829.84 10,022.20 11,453.94 14,317.42 14,317.42 17,180.91 10,308.54 11,339.40

Accrued Exp. 1190.00 1632.00 2967.00 4318.47 5614.01 7185.93 9197.99 11497.49 14371.86 17246.23 20695.48 22765.03 25041.53 Other Non-current Liabilities 2,685.58 1,351.68 1,640.03 2,099.24 2,399.13 2,998.92 2,998.92 3,598.70 2,159.22 2,375.14

Curr. Port. of LT Debt 1399.00 1758.00 1088.00 3695.23 4803.80 6148.86 7870.54 9838.18 12297.72 14757.27 17708.72 19479.59 21427.55 Long-Term Leases 3,259.43 1,776.43 2,155.40 2,758.91 3,153.04 3,941.31 3,941.31 4,729.57 2,837.74 3,121.51

Curr. Port. of Leases 614.00 660.00 869.00 1725.68 2243.38 2871.53 3675.56 4594.45 5743.06 6891.67 8270.00 9097.00 10006.70 Dividends paid 0 0 0 0 0 0 0 0 0 0

Curr. Income Taxes Payable 611.00 777.00 1122.00 1956.17 2543.02 3255.07 4166.49 5208.11 6510.14 7812.17 9374.60 10312.06 11343.27 Total 23,170.57 9,581.27 11,625.27 14,880.35 17,006.12 21,257.64 21,257.64 25,509.17 15,305.50 16,836.05

Unearned Revenue, Current 1163.00 1458.00 1447.00 3349.15 4353.90 5572.99 7133.42 8916.78 11145.98 13375.17 16050.21 17655.23 19420.75

Other Current Liabilities 1919.00 1912.00 2187.00 4987.19 6483.35 8298.69 10622.32 13277.90 16597.38 19916.85 23900.22 26290.25 28919.27 Net Change in cash 29,528.09 22,937.95 28,669.80 44,328.64 55,663.37 68,860.64 78,034.76 91,572.19 86,935.33 68,083.19

Total current liabilities 10667.00 14248.00 19705.00 34813.93 45258.11 57930.38 74150.88 92688.60 115860.75 139032.91 166839.49 183523.44 201875.78

Non-current Liabilities

Long-Term Debt 10375.00 8571.00 4285.00 21510.55 27963.72 35793.56 45815.75 57269.69 71587.11 85904.53 103085.44 113393.99 124733.38

Long-Term Leases 2188.00 2348.00 2662.00 5921.43 7697.86 9853.26 12612.18 15765.22 19706.53 23647.84 28377.40 31215.14 34336.66

Unearned Revenue, Non-Current 1207.00 1284.00 2052.00 3558.08 4625.51 5920.65 7578.44 9473.04 11841.30 14209.57 17051.48 18756.63 20632.29

Def. Tax Liability, Non-Curr. 66.00 151.00 24.00 220.23 286.30 366.46 469.07 586.33 732.92 879.50 1055.40 1160.94 1277.03

Other Non-Current Liabilities 1696.00 1867.00 1820.00 4505.58 5857.26 7497.29 9596.53 11995.67 14994.58 17993.50 21592.20 23751.42 26126.56

Total non-current liabilities 15532 14221 10843 35715.8791589033 46430.6429065743 59431.2229204152 76071.9653381314 95089.9566726642 118862.44584083 142634.935008996 171161.922010796 188278.114211875 207105.925633063

Total liabilities 26199.00 28469.00 30548.00 70529.81 91688.75 117361.60 150222.85 187778.56 234723.20 281667.84 338001.41 371801.55 408981.70

Total Stockholders’ equity 8109.00 23679.00 31452.00 46416.18 60341.03 77236.52 98862.74 123578.43 154473.03 185367.64 222441.17 244685.28 269153.81

Totla Liabilities and stockholders’ equity 34308.00 52148.00 62000.00 116945.98 152029.78 194598.12 249085.59 311356.99 389196.23 467035.48 560442.58 616486.83 678135.52

Ratio Analysis

2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

ROE 23.40% 31.40% 31.40% 39.39% 40.99% 40.99% 40.99% 40.99% 40.99% 40.99%

ROA 31.65% 36.33% 39.11% 33.30% 33.32% 32.54% 30.51% 29.29% 25.77% 23.62%

Profit Margin 13.02% 17.47% 17.47% 21.92% 22.81% 22.81% 22.81% 22.81% 22.81% 22.81%

WACC

WACC

Cost of debt:

Cost of debt 4.25%

Tax rate 11%

After-tax cost of debt 3.78%

Cost of equity:

Risk free rate 3%

Beta 1.65

Market premium 5%

Cost of equity 11.25%

Percentage of Capital:

Total Debt/Equity 19.84%

Debt % 16.56%

Equity % 83.44%

WACC:

WACC 10.01%

Valuation

WACC 10.01%

Terminal growth rate 5%

2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E

Net Income 10,860.07 18,944.30 24,248.73 38,945.61 50,658.84 63,323.58 75,988.31 91,186.00 100,304.61 110,335.08

Depreciation & Amort. 2,502.77 3,253.60 4,164.61 5,330.70 6,663.37 8,329.22 9,995.06 11,994.07 13,193.48 14,512.83

Increase in working capital 9109.02 4911.91 5959.78 7628.52 8718.31 10897.88 10897.88 13077.46 7846.48 8631.12

CAPEX 8,610.78 11,194.01 14,328.33 18,340.27 22,925.34 28,656.67 34,388.00 41,265.60 45,392.16 49,931.38

FCF (4,356.96) 6,091.98 8,125.22 18,307.52 25,678.57 32,098.24 40,697.49 48,837.00 60,259.44 66,285.40

Terminal value $ 1,388,182.82

PV OF FCF $ 148,390.25

PV OF TV $ 534,537.24

Value of the firm $ 682,927.49

Current cash $ 17,576.00

Value of equity $ 700,503.49

# of shares(in Million) 1030

Value per share $ 680.10

EBO

TSLA

PARAMETERS FY1 FY2 Ltg

EPS Forecasts 12.32 15.90 30.00%

Book value/share (last fye) 32.90 30.2%

Discount Rate 8.50%

Dividend Payout Ratio 0

Next Fsc Year end 2022

Current Fsc Mth (1 to 12) 5

Target ROE (industry avg.) 0.2500

Year 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033

Long-term EPS Growth Rate (Ltg) 0.3024 0.3024 0.3024 0.3024 0.3024

Forecasted EPS 12.32 15.90 20.71 26.97 35.12 45.74 59.57

Beg. of year BV/Shr 32.9 45.22 61.12 81.8275972952 108.7964391658 143.9197043844 189.6630019844

Implied ROE 0.3516143299 0.3388023118 0.3295812508 0.3228346947 0.3178390186 0.3141068701

ROE 0.374 0.352 0.339 0.330 0.323 0.318 0.314 0.301 0.288 0.276 0.263 0.250

Abnormal ROE 0.289 0.267 0.254 0.245 0.238 0.233 0.229 0.216 0.203 0.191 0.178 0.165

Beg of year BV/shr 32.900 45.220 61.120 81.828 108.796 143.920 189.663 249.237 324.329 417.886 533.074 673.177

End of year BV/shr 45.220 61.120 81.828 108.796 143.920 189.663 249.237 324.329 417.886 533.074 673.177 841.471

required rate (r) 0.085 0.085 0.085 0.085 0.085 0.085 0.085 0.085 0.085 0.085 0.085 0.085

discount rate 1.085 1.177 1.277 1.386 1.504 1.631 1.770 1.921 2.084 2.261 2.453 2.662

Perpetuity 103.26 120.49 142.88 169.90 202.45 241.65 288.80 330.21 372.55 414.54 454.60 490.95

PV of Abnormal ROE 0.27 0.23 0.20 0.18 0.16 0.14 0.13 0.11 0.10 0.08 0.07 0.06

Incremental value each year 8.78 10.24 12.14 14.44 17.21 20.54 24.55 28.07 31.67 35.24 38.64 41.73

Cumulative Incremental value 8.78 19.02 31.16 45.60 62.81 83.35 107.90 135.97 167.64 202.87 241.51 283.24

Implied price 150.07 178.51 214.27 257.20 308.73 370.57 444.81 516.75 593.38 673.34 754.83 835.68

Multiple

LTM EPS 8.37

NTM EPS 12.74

LTM Sales 62190

NTM Sales 95197.52

LTM EBITDA 12702

NTM EBITDA 23183.08

Multiples Valuation

Name LTM P/E  NTM P/E LTM EV/Sales NTM EV/Sales LTM EV/EBITDA NTM EV/EBITDA

TM Toyota Motor 9.94 11.16 0.05 1.45 0.32 12.23

F Ford Motor Company 16.47 6.06 4.91 1.08 12.79 9.61

GM General Motors Company 6.35 5.63 5.18 0.96 32.2 5.91

HMC Honda Motor Company Ltd. 7.27 8 0.02 0.66 0.21 7.85

RACE Ferrari N.V. Common Shares 40.2 35.9 41.68 7.03 130.21 20.24

STLA Stellantis N.V. 4.74 2.84 0.15 0.14 1.11 0.95

RIVN Rivian Automotive, Inc. N/A N/A 169.62 2.03 -2.09 N/A

Average 14.16 11.60 31.66 1.91 24.96 9.47

Tesla 106.4 61.76 13 8.46 60.3 34.76

EV 1968846.56 181555.27 317096.36 219427.85

Share price $118.53 $147.76 $1,911.50 $176.27 $307.86 $213.04

Source: Capital IQ

$

Income Statement

Tesla, Inc. (NasdaqGS:TSLA) > Financials > Income Statement

In Millions of the reported currency, except per share items. Template: Standard   Restatement: Latest Filings

Period Type: Annual   Order: Latest on Right

Currency: Reported Currency   Conversion: Historical

Units: S&P Capital IQ (Default)   Decimals: Capital IQ (Default)

Source: Capital IQ & Proprietary Data  

Income Statement

For the Fiscal Period Ending
Restated
12 months
Dec-31-2019 12 months
Dec-31-2020 12 months
Dec-31-2021

Currency USD USD USD

Revenue 24,578.0 31,536.0 53,823.0

Other Revenue – – –

Total Revenue 24,578.0 31,536.0 53,823.0

Cost Of Goods Sold 20,509.0 24,906.0 40,217.0

Gross Profit 4,069.0 6,630.0 13,606.0

Selling General & Admin Exp. 2,646.0 3,188.0 4,517.0

R & D Exp. 1,343.0 1,491.0 2,593.0

Depreciation & Amort. – – –

Other Operating Expense/(Income) – – (27.0)

Other Operating Exp., Total 3,989.0 4,679.0 7,083.0

Operating Income 80.0 1,951.0 6,523.0

Interest Expense (725.0) (784.0) (358.0)

Interest and Invest. Income 44.0 30.0 56.0

Net Interest Exp. (681.0) (754.0) (302.0)

Currency Exchange Gains (Loss) 48.0 (114.0) 97.0

Other Non-Operating Inc. (Exp.) 37.0 28.0 25.0

EBT Excl. Unusual Items (516.0) 1,111.0 6,343.0

Restructuring Charges (87.0) – –

Impairment of Goodwill – – –

Asset Writedown (15.0) – –

In Process R & D Exp. (47.0) – –

Legal Settlements – 43.0 –

Other Unusual Items – – –

EBT Incl. Unusual Items (665.0) 1,154.0 6,343.0

Income Tax Expense 110.0 292.0 699.0

Earnings from Cont. Ops. (775.0) 862.0 5,644.0

Earnings of Discontinued Ops. – – –

Extraord. Item & Account. Change – – –

Net Income to Company (775.0) 862.0 5,644.0

Minority Int. in Earnings (87.0) (141.0) (125.0)

Net Income (862.0) 721.0 5,519.0

Pref. Dividends and Other Adj. 8.0 31.0 (5.0)

NI to Common Incl Extra Items (870.0) 690.0 5,524.0

NI to Common Excl. Extra Items (870.0) 690.0 5,524.0

Per Share Items

Basic EPS ($0.98) $0.74 $5.6

Basic EPS Excl. Extra Items (0.98) 0.74 5.6

Weighted Avg. Basic Shares Out. 887.0 933.0 986.0

Diluted EPS ($0.98) $0.64 $4.9

Diluted EPS Excl. Extra Items (0.98) 0.64 4.9

Weighted Avg. Diluted Shares Out. 887.0 1,083.0 1,129.0

Normalized Basic EPS ($0.46) $0.59 $3.89

Normalized Diluted EPS (0.46) 0.51 3.4

Dividends per Share NA NA NA

Shares per Depository Receipt 0.031 0.031 0.031

Supplemental Items

EBITDA 2,172.0 4,273.0 9,333.0

EBITA 124.0 2,002.0 6,574.0

EBIT 80.0 1,951.0 6,523.0

EBITDAR 2,598.0 4,724.0 9,960.0

As Reported Total Revenue* 24,578.0 31,536.0 53,823.0

Effective Tax Rate % NM 25.3% 11.0%

Current Domestic Taxes 5.0 4.0 9.0

Current Foreign Taxes 86.0 248.0 839.0

Total Current Taxes 91.0 252.0 848.0

Deferred Domestic Taxes (4.0) NA NA

Deferred Foreign Taxes 23.0 40.0 (149.0)

Total Deferred Taxes 19.0 40.0 (149.0)

Normalized Net Income (409.5) 553.4 3,839.4

Interest Capitalized 31.0 48.0 53.0

Interest on Long Term Debt 355.0 506.0 159.0

Filing Date Feb-07-2022 Feb-07-2022 Feb-07-2022

Restatement Type RS NC O

Calculation Type REP REP REP

Supplemental Operating Expense Items

R&D Exp. 1,390.0 1,491.0 2,593.0

Net Rental Exp. 426.0 451.0 627.0

Imputed Oper. Lease Interest Exp. 181.4 215.1 185.4

Imputed Oper. Lease Depreciation 244.6 235.9 441.6

Stock-Based Comp., COGS 128.0 281.0 421.0

Stock-Based Comp., R&D Exp. 285.0 346.0 448.0

Stock-Based Comp., SG&A Exp. 482.0 1,107.0 1,252.0

Stock-Based Comp., Unallocated 3.0 – –

Stock-Based Comp., Total 898.0 1,734.0 2,121.0

* Occasionally, certain items classified as Revenue by the company will be re-classified as other income if it is deemed to be non-recurring and unrelated to the core business of the firm. This field shows Total Revenue exactly as reported by the firm on its consolidated statement of income.

Note: For multiple class companies, per share items are primary class equivalent, and for foreign companies listed as primary ADRs, per share items are ADR-equivalent.

Balance Sheet

Tesla, Inc. (NasdaqGS:TSLA) > Financials > Balance Sheet

In Millions of the reported currency, except per share items. Template: Standard   Restatement:

Period Type: Annual   Order:

Currency: Reported Currency   Conversion:

Units: S&P Capital IQ (Default)   Decimals:

Source: Capital IQ & Proprietary Data  

Balance Sheet

Balance Sheet as of:
Dec-31-2019 Dec-31-2020 Dec-31-2021

Currency USD USD USD

ASSETS

Cash And Equivalents 6,268.0 19,384.0 17,576.0

Short Term Investments – – 131.0

Total Cash & ST Investments 6,268.0 19,384.0 17,707.0

Accounts Receivable 1,324.0 1,903.0 1,986.0

Total Receivables 1,324.0 1,903.0 1,986.0

Inventory 3,552.0 4,101.0 5,757.0

Prepaid Exp. 713.0 1,091.0 1,305.0

Restricted Cash 246.0 238.0 345.0

Other Current Assets – – –

Total Current Assets 12,103.0 26,717.0 27,100.0

Gross Property, Plant & Equipment 25,062.0 29,893.0 39,867.0

Accumulated Depreciation (4,863.0) (6,518.0) (8,691.0)

Net Property, Plant & Equipment 20,199.0 23,375.0 31,176.0

Long-term Investments 1.0 – –

Goodwill 198.0 207.0 200.0

Other Intangibles 339.0 313.0 257.0

Accounts Receivable Long-Term – 74.0 303.0

Other Long-Term Assets 1,469.0 1,462.0 3,095.0

Total Assets 34,309.0 52,148.0 62,131.0

LIABILITIES

Accounts Payable 3,771.0 6,051.0 10,025.0

Accrued Exp. 1,190.0 1,632.0 2,967.0

Curr. Port. of LT Debt 1,399.0 1,758.0 1,088.0

Curr. Port. of Leases 614.0 660.0 869.0

Curr. Income Taxes Payable 611.0 777.0 1,122.0

Unearned Revenue, Current 1,163.0 1,458.0 1,447.0

Other Current Liabilities 1,919.0 1,912.0 2,187.0

Total Current Liabilities 10,667.0 14,248.0 19,705.0

Long-Term Debt 10,375.0 8,571.0 4,285.0

Long-Term Leases 2,188.0 2,348.0 2,662.0

Unearned Revenue, Non-Current 1,207.0 1,284.0 2,052.0

Def. Tax Liability, Non-Curr. 66.0 151.0 24.0

Other Non-Current Liabilities 1,696.0 1,867.0 1,820.0

Total Liabilities 26,199.0 28,469.0 30,548.0

Common Stock 1.0 1.0 1.0

Additional Paid In Capital 12,736.0 27,260.0 29,803.0

Retained Earnings (6,083.0) (5,399.0) 331.0

Treasury Stock – – –

Comprehensive Inc. and Other (36.0) 363.0 54.0

Total Common Equity 6,618.0 22,225.0 30,189.0

Minority Interest 1,492.0 1,454.0 1,394.0

Total Equity 8,110.0 23,679.0 31,583.0

Total Liabilities And Equity 34,309.0 52,148.0 62,131.0

Supplemental Items

Total Shares Out. on Filing Date 906.7 959.9 1,033.5

Total Shares Out. on Balance Sheet Date 905.0 960.0 1,033.0

Book Value/Share $7.31 $23.15 $29.22

Tangible Book Value 6,081.0 21,705.0 29,732.0

Tangible Book Value/Share $6.72 $22.61 $28.78 0.2819238198

Total Debt 14,576.0 13,337.0 8,904.0 0.2819238198

Net Debt 8,308.0 (6,047.0) (8,803.0)

Debt Equivalent Oper. Leases 3,408.0 3,608.0 5,016.0

Total Minority Interest 1,492.0 1,454.0 1,394.0

Inventory Method FIFO FIFO FIFO

Raw Materials Inventory 1,428.0 1,508.0 2,816.0

Work in Progress Inventory 362.0 493.0 1,089.0

Finished Goods Inventory 1,762.0 2,100.0 1,852.0

Land 3,024.0 3,662.0 4,675.0

Machinery 16,062.0 18,030.0 20,453.0

Construction in Progress 782.0 1,649.0 5,577.0

Leasehold Improvements 1,087.0 1,421.0 1,826.0

Full Time Employees 48,016 70,757 99,290

Assets on Oper. Lease, Gross 2,853.0 3,537.0 5,284.0

Assets on Oper. Lease, Accum. Depr. (406.0) (446.0) (773.0)

Filing Date Feb-07-2022 Feb-07-2022 Feb-07-2022

Restatement Type NC NC O

Calculation Type RUP REP REP

Note: For multiple class companies, total share counts are primary class equivalent, and for foreign companies listed as primary ADRs, total share counts are ADR-equivalent.

Cash flow

Tesla, Inc. (NasdaqGS:TSLA) > Financials > Cash Flow

In Millions of the reported currency, except per share items. Template: Standard   Restatement:

Period Type: Annual   Order:

Currency: Reported Currency   Conversion:

Units: S&P Capital IQ (Default)   Decimals:

Source: Capital IQ & Proprietary Data  

Cash Flow

For the Fiscal Period Ending
12 months
Dec-31-2019 12 months
Dec-31-2020 12 months
Dec-31-2021

Currency USD USD USD

Net Income (862.0) 721.0 5,519.0

Depreciation & Amort. 2,048.0 2,271.0 2,759.0

Amort. of Goodwill and Intangibles 44.0 51.0 51.0

Depreciation & Amort., Total 2,092.0 2,322.0 2,810.0

Asset Writedown & Restructuring Costs 62.0 – –

Stock-Based Compensation 898.0 1,734.0 2,121.0

Other Operating Activities 564.0 982.0 529.0

Change in Acc. Receivable (367.0) (652.0) (130.0)

Change In Inventories (429.0) (422.0) (1,709.0)

Change in Acc. Payable 646.0 2,102.0 4,578.0

Change in Unearned Rev. 801.0 321.0 793.0

Change in Other Net Operating Assets (1,000.0) (1,165.0) (3,014.0)

Cash from Ops. 2,405.0 5,943.0 11,497.0

Capital Expenditure (1,432.0) (3,232.0) (8,014.0)

Sale of Property, Plant, and Equipment – – 272.0

Cash Acquisitions (45.0) (13.0) –

Divestitures – – –

Sale (Purchase) of Intangible assets (5.0) (10.0) –

Invest. in Marketable & Equity Securt. – – (132.0)

Net (Inc.) Dec. in Loans Originated/Sold – – –

Other Investing Activities 46.0 123.0 6.0

Cash from Investing (1,436.0) (3,132.0) (7,868.0)

Short Term Debt Issued – – –

Long-Term Debt Issued 10,669.0 9,713.0 8,883.0

Total Debt Issued 10,669.0 9,713.0 8,883.0

Short Term Debt Repaid – – –

Long-Term Debt Repaid (9,871.0) (12,201.0) (14,615.0)

Total Debt Repaid (9,871.0) (12,201.0) (14,615.0)

Issuance of Common Stock 1,111.0 12,686.0 707.0

Total Dividends Paid – – –

Special Dividend Paid – – –

Other Financing Activities (380.0) (225.0) (178.0)

Cash from Financing 1,529.0 9,973.0 (5,203.0)

Foreign Exchange Rate Adj. 8.0 334.0 (183.0)

Net Change in Cash 2,506.0 13,118.0 (1,757.0)

Supplemental Items

Cash Interest Paid 455.0 444.0 266.0

Cash Taxes Paid 54.0 115.0 561.0

Levered Free Cash Flow 1,308.9 3,221.4 4,628.1

Unlevered Free Cash Flow 1,762.0 3,711.4 4,851.9

Change in Net Working Capital (159.0) (1,678.0) (3,858.0)

Net Debt Issued 798.0 (2,488.0) (5,732.0)

Filing Date Feb-07-2022 Feb-07-2022 Feb-07-2022

Restatement Type NC NC O

Calculation Type REP REP REP

Company: Tesla
1. Overall industry analysis and firm strategy analysis

· Tesla company overview
Tesla(NASDAQ: TSLA), an American manufacturer that produces electric automobiles, solar panels, and batteries, was founded in 2003 by Martin Eberhard and Marc Tarpenning in Austin, Taxes of the United States. It was named after Serbian American inventor Nikola Tesla. Also, Tesla is the first automobile company that produces and sells federal compliant electric vehicles like known sports car Roadsters first released in 2008, then sedan Model S and Model 3, and SUV in Model X. Elon Musk, the CEO of Tesla, an South African-born American entrepreneur who co-founded the electronic-payment firm PayPal and formed SpaceX. He became its biggest shareholder in February 2004, aimed to accelerate the development of the electric car’s industry, leading Tesla’s market capitalization growth to $1.01 trillion, making it the world’s 6th most valuable company.
electric vehicle industry overview+firm Strategy analysis
And this is just the beginning. With Tesla building its most affordable car yet, Tesla continues to make products accessible and affordable to more and more people, ultimately accelerating the advent of clean transport and clean energy production.
Explain Peer company compare

2. Profitability analysis (Dupont decomposition) over time and using comparables. The important part here is identifying performance strengths and weaknesses and the associated discussion rather than simply describing the ratios.

· Revenue analysis

Driven by the increase in the number of cars Tesla delivered, and increase in average sales prices, Tesla produced a stable growed revenue from 2019 to 2021. The 29.86% of CAGR gives a good sign that the company is running a profitable business.
· Profits+Margins analysis

In addition to having strong year-over-year revenue growth, Tesla has maintained stable gross
margins, from 16% to 25%, for the past three fiscal years, in part driven by Tesla’s explosive growth
during the COVID-19 period and manufacturing capacity.
In terms of the firm’s profitability from the figures that it is metaphorically speaking were starting to catch steam in the year 2019 as witnessed by a profit margin jump from a negative margin figure of -3% to a positive margin of 10%, with year-over-year profit margin of 3.51%, 2.29% and 10.25% in 2019, 2020 and 2021 respectively. effectively amounting to a 13% increase.
· ROE+roe decomposition

· ROA

There was a spike experienced in Tesla from the 2019 to 2021’s return on equity and assets,since the Model Y, SUV electric car published

· Peer comparisons

In terms of revenue growth, SAM hasoutpaced its peers in the industry except luxury brand Ferrari, with a
second profit margin 13.5%, ROE 28.26%, and ROA 10.12%, with over 70% share of automobile market.
3. Cash flow analysis both qualitative and quantitative
· Overall cash flow
Overall, SAM has a very healthy balance sheet with strong liquidity and little leverage. With regards to its cash flow profile, SAM’s operating cash index over the past few years has trended downwards, but has hovered around 1, suggesting that its earnings are largely backed by cash and supplemented by non-cash items, such as depreciation.

· Working capital management
AM’s high earnings quality corresponds to the health of its liquidity. Inventory has increased at a steady rate. SAM’s payables have also gone up as its accounts receivables have shrunk over th same time frame, suggesting that the company has been improving its cash conversion cycle. Thisis in line with the trend of increasing cash flow from operations, which indicates that SAM, a
mature firm, is able to effectively fund its current liabilities with current asset

· Capital expenditures

The cap expenditureshas largely outpaced depreciation in recent years as the company invested in its breweries,increasing manufacturing capacity, driving efficiencies and cost reductions and supporting innovation. Other than its $330 MM acquisition of Dogfish Head Brewery in 2019, its recent investments have been organic. While SAM is an established player in a mature industry, the trend of rising capex is reasonable because the company has been investing in manufacturing capacity for key growth segments, the Truly hard-seltzer and cider divisions.

· Peer comparisons of liquidity

The Tesla has a healthy asset turnover in 0.87, which is relatively higher than peer companys’ asset turnover rate float by 0.1, considered efficient to generate revenue or sales from company’s assets. Also, its current ratio in March 2022 is 1.35, which is lower than average 2 indicating the weak short-term ability to pay obligations. Also, the industry current ratio is 1.98, proving that Tesla Inc is considered to be overvalued.

4. Pro Forma projections and discussing economic consistency (you can use my template or any other template of your choice). Important to discuss key assumptions e.g., growth, COGS etc.

5. DCF analysis

6. EBO/Residual income valuation (you can use my spreadsheet)

7. Relative valuation

8. Put it all together to provide an executive summary with a final conclusion on whether the firm is a buy or sell

1

I. Boston Beer Company Overview

The Boston Beer Company (NYSE: SAM) operates in the high-end alcoholic beverage industry

and is one of the largest craft brewers in the United States. Its portfolio includes several brand

leaders such as Truly Hard Seltzer, Samuel Adams and Angry Orchard Hard Ciders. It has also

seen great success with its hard iced tea line, Twisted Teas, which has become the best-selling

hard tea brand in the nation. The company is currently experiencing mixed growth within its

product categories, with hard seltzer and alcoholic teas leading growth and beer and hard ciders

experiencing slight declines.

The hard seltzer market size is approximately $3.8bn, with 58% of the off-premise market share

belonging to White Claw and 26% belonging to Truly1. Meanwhile, Twisted Tea dominates the

hard tea category with over 90% market share. Strong performance by both brands is due to

beverage trends shifting towards more low-calorie, gluten-free and health-conscious choices.

The craft beer market experienced a significant downturn due to the pandemic, adding to the

declining presence of Boston Beer Company’s beer brands for the last two years. Its brands only

account for 1% of the U.S. beer market1. It is a highly fragmented industry that is highly

competitive with low barriers to entry. Thus, beer companies have shifted towards producing more

flavors to differentiate their product lines and to satisfy increasing preferences in flavored beers.

This trend suggests new opportunities for SAM as a high-end beer producer.

With the hard seltzer market expected to grow to $30bn by 20301 and as optimism increases in the

craft beer sector as we slowly return back to normalcy, we anticipate a lot of growth and

opportunity ahead for the company.

1 Seeking Alpha

2

II. Profitability Analysis

Revenue

SAM is a growth story within a mature industry. After experiencing declining revenue growth in

2016 (-5.6%) and 2017 (-4.8%), SAM rebounded strongly in the following years with year-over-

year growth rates of 15.4%, 25.5% and 38.9% in 2018, 2019 and 2020 respectively. The torrid

top-line growth was primarily driven by its Truly hard-seltzer segment and the integration of its

craft beer brand, Dogfish Head Brewery, which was acquired in March 2019. As of the fiscal year

2020, its Truly hard-seltzer segment accounts for approximately 48% of its revenue and owns 26%

share of the fast-growing U.S. hard-seltzer market2. However, it is unlikely that the company can

sustain its strong pace of growth for several reasons. New entrants in the hard-seltzer space and

fickle customer loyalty to brands intensify competition in the lucrative market. Its flagship brands

Samuel Adams and Angry Orchard, also face headwinds in their respective categories, driven by

a consumer shift towards lower consumption of traditional beer and craft beer3.

1Goldman Sachs Equity Research Report
2IBISWorld
3IBISWorld

863
996

1,250

1,736

FY2017A FY2018A FY2019A FY2020A

Revenue (US $ MM)

3

Margins

In addition to having strong year-over-year revenue growth, SAM has maintained stable operating

margins, between 16% and 20%, for the past four fiscal years. Gross margins have trended

downwards recently, in part driven by SAM’s explosive growth in seltzer and a constraint in

manufacturing capacity. However, while management has gradually added capacity, the increases

have not been sufficient to meet demand. The higher costs were attributed to increased reliance on

production at third-party breweries. The recent uptick in operating margin was attributed to a

temporary decrease in SG&A costs, according to management, as the pandemic reduced

advertising spend. Promotional spending on brands is expected to pick up in the second half of

2021, which will pressure operating margin4.

4 Morningstar Research

Angry Orchard
11%

Samuel Adams
11%

Twisted Tea
26%

Truly Hard
Seltzer

49%

Other
3%

Revenue breakdown by segment

4

Returns Analysis

SAM’s ROA has remained relatively stable, around 15 – 16%, other than in 2019 when it

significantly increased its asset base through the Dogfish acquisition. At the same time, its ROE

has stayed fairly consistent, which can be explained by the fact that it has little debt. However, its

earnings per share has increased much more quickly. Over the past three years, this change

corresponds to the increase in APIC, suggesting that it is primarily driven by reinvestment of

earnings back into the company.

52.1% 51.4%
49.1%

47.4%

FY2017A FY2018A FY2019A FY2020A

Gross Margin

19.6%
16.9% 16.8%

18.6%

FY2017A FY2018A FY2019A FY2020A

EBITDA Margin

11.5%
9.3% 8.8%

11.1%

FY2017A FY2018A FY2019A FY2020A

Net Margin

5

Return on Assets
FY2017A FY2018A FY2019A FY2020A
Net Income 99.0 92.7 110.0 192.0
Interest Expense x (1 – 21%) 0.0 0.0 0.0 -0.1
Sum 99.0 92.7 110.0 191.9
Total Average Assets 592.8 604.7 847.0 1,216.4
ROA 16.7% 15.3% 13.0% 15.8%

Return on Equity
FY2017A FY2018A FY2019A FY2020A
Total Average SE 435.1 441.9 598.0 846.3
ROE 22.8% 21.0% 18.4% 22.7%

Earnings Per Share
all others in USD MM FY2017A FY2018A FY2019A FY2020A
Net Income 99.0 92.7 110.0 192.0
Weighted Average Shares Outstanding 12.2 11.7 11.9 12.3
Diluted Earnings Per Share (reported) 8.1 7.8 9.2 15.5
Additional Paid-In Capital 372.6 405.7 571.8 599.7
Change in Diluted Earnings Per Share -3% 17% 70%
Change in APIC 9% 41% 5%

Peer Comparison

In terms of revenue growth, SAM has far outpaced its peers in the past two fiscal years, with a

CAGR of 32.1%. For context, our peer set is relatively diversified, including both domestic and

international wine and spirits makers. SAM’s revenue concentration in the hard-seltzer segment

not only buffeted declining or flat sales during the pandemic, as experienced by other global

competitors, but was rather integral to the company’s growth. SAM’s margins trail those of its

peers, primarily because of its unique product segment. Unlike most of its peers, which include

much larger players in the mature beer and alcoholic beverages industries, SAM’s revenue is

mainly driven by a hyper-growth hard-seltzer niche segment and its traditional but declining craft

and hard cider products. Hence, SAM’s margins are lower due to heavier SG&A spending as a

6

proportion of revenue, which includes brand promotion and non-recurring integration costs.

III. Cash Flow Analysis

Overall, SAM has a very healthy balance sheet with strong liquidity and little leverage. With

regards to its cash flow profile, SAM’s operating cash index over the past few years has trended

downwards, but has hovered around 1, suggesting that its earnings are largely backed by cash and

supplemented by non-cash items, such as depreciation.

Cash Flow Profile
in USD millions FY2017A FY2018A FY2019A FY2020A
Net Income 99.0 92.7 110.0 192.0
Cash Flow from Operations 136.0 163.4 178.2 253.4
Cash Flow from Investing -32.9 -55.3 -258.8 -139.1
Cash Flow from Financing -128.5 -65.3 8.9 12.3
Net Change in Cash -25.4 42.8 -71.7 126.6

32.1%

3.0% 2.2%
(1.6%) (1.7%) (2.1%) (3.2%) (5.3%) (6.0%) (6.4%)

The Boston Beer
Company, Inc.

Constellation
Brands, Inc.

Tsingtao Brewery
Company Limited

Pernod Ricard SA Diageo plc Kirin Holdings
Company, Limited

Carlsberg A/S Molson Coors
Beverage
Company

Anheuser-Busch
InBev SA/NV

Heineken N.V.

Revenue CAGR (FY2018 – 2020)
Peer Comparison

0.90
1.20 1.11 0.98

FY2017A FY2018A FY2019A FY2020A

Operating Cash Index
(Operating Cash Flow – Depreciation) / Net Income

7

Working Capital Management

SAM’s high earnings quality corresponds to the health of its liquidity. Inventory has increased at

a steady rate. SAM’s payables have also gone up as its accounts receivables have shrunk over the

same time frame, suggesting that the company has been improving its cash conversion cycle. This

is in line with the trend of increasing cash flow from operations, which indicates that SAM, a

mature firm, is able to effectively fund its current liabilities with current assets.

Capital Expenditure & Financing

Capex has largely outpaced depreciation in recent years as the company invested in its breweries,

increasing manufacturing capacity, driving efficiencies and cost reductions and supporting

innovation. Other than its $330 MM acquisition of Dogfish Head Brewery in 2019, its recent

investments have been organic. While SAM is an established player in a mature industry, the trend

of rising capex is reasonable because the company has been investing in manufacturing capacity

for key growth segments, the Truly hard-seltzer and cider divisions.

From a financing perspective, SAM has been able to largely maintain a cash inflow due to cash

flow from operations. SAM had no debt before 2019, and with the $72 million of debt on its

balance sheet currently, the firm has a high-interest coverage ratio given its robust operating cash

3 -2 -12
-24

-2 -21 -25 -25
0 6

21
41

FY2017A FY2018A FY2019A FY2020A

Changes in Working Capital
(in USD millions)

Change in Acc. Receivable Change In Inventories Change in Acc. Payable

51 52 56 66
33

56
93

140

FY2017A FY2018A FY2019A FY2020A

Depreciation vs. Capex
(in USD millions)

Depreciation Capex

8

flows. The company also capitalized on a rich stock price, which has increased by roughly 200%

since December 2019 and issued $15 million and $19 million of stock in the past two years.

IV. Pro-forma Financial Statements

Our projected profitability and cash flow analysis is reflected in our pro-forma financial statements

below:

Income Statement Projections ($mm)

Sales Growth Assumptions

We agree with management’s optimistic projections of 26.2% and 14.6% sales growth in 2022 and

2023, respectively, as the economy reopens and the alcohol and leisure sectors experience high-

volume demand. Further, SAM’s Truly brand has proven a significant leader in the hard seltzer

market, which is forecasted to grow from $4bn in 2020 to $30bn by 2030.5 However, despite the

pandemic-related market expansion, we predict the firm’s revenue growth to slow in 2023 as the

market stabilizes post-pandemic and early brand innovators such as Truly and White Claw lose

their first-mover advantage in the hard seltzer market. We expect the firm to reach a long-term

growth rate of 2% by 2029 as the seltzer market matches the growth rates of the more mature beer

and cider industries.

5 Goldman Sachs Equity Research Report

9

Growth Timeline Assumptions
2021 2022 2023 2024 2025 2026 2027 2028 2029

Sales growth 43.1% 26.2% 14.6% 10.0% 7.5% 5.0% 4.0% 3.0% 2.0%
GAAP Earnings Growth 54.1% 46.3% 29.5% (2.4%) 7.6% 5.1% 4.1% 3.1% 2.2%

Cash Earnings Growth 44.9% 46.3% 29.5% (2.4%) 7.6% 5.1% 4.1% 3.1% 2.2%

Margin Assumptions

Further, we assumed a gross margin of 48.3% from 2022, growing 1.4% due to expected

economies of scale realized in the near-term growth cycle.

Margin Timeline Assumptions
2021 2022 2023 2024 2025 2026 2027 2028 2029

Gross margin 46.9% 48.3% 48.3% 48.3% 48.3% 48.3% 48.3% 48.3% 48.3%

EBITDA margin 20.8% 21.2% 23.5% 21.2% 21.2% 21.2% 21.2% 21.2% 21.2%
EBIT margin 15.2% 17.6% 19.9% 17.6% 17.6% 17.6% 17.6% 17.6% 17.6%

Balance Sheet Projections ($mm)

Boston Beer Company currently has a healthy balance sheet with excess cash reserves growing

from $163mm reported in 2020 to a forecasted $3.56bn in 2030 without major transactions

10

occurring in the following 10-year period. These gains are driven primarily by expected seltzer

sales growth in post-pandemic reopening. Additionally, we forecast significant gross PP&E

investments, growing from $689mm in last fiscal year to $4.55bn in 2030 as the firm modernizes

and scales its factory assets to meet rising demand.

CapEx and Depreciation Timeline Assumptions

2021 2022 2023 2024 2025 2026 2027 2028 2029

CapEx/Sales 9.0% 8.5% 8.8% 8.6% 8.7% 8.7% 8.7% 8.7% 8.7%
Depreciation/Sales 5.6% 3.6% 3.6% 3.6% 3.6% 3.6% 3.6% 3.6% 3.6%

Cash Flow Statement Projections ($mm)

IV. DCF Valuation

Using the projected financial statements described above, we built a DCF model that calculates

Boston Beer Company’s unlevered free cash flow for years 2021 – 2030. When discounting the

free cash flows, we assumed a 6% discount rate.

11

For terminal value we used the perpetuity growth method using a 2% growth rate, after which we

discounted the terminal value using a 6% discount rate. Upon summing up the present values of

free cash flows and the present value of the terminal value, we found an enterprise value of

$12,483. By subtracting net debt of -$163, we found an equity value of $12,647, which resulted in

$1,014.52 equity value per share. Given that we made assumptions for the WACC and perpetuity

growth rate, we also conducted a sensitivity analysis to see the effect of our assumptions on the

enterprise value, equity value and equity value per share.

We also used the EBITDA multiple method to find terminal value, by assuming a 22.5x exit

multiple, based on our analysis of comparable companies. The projected EBITDA for 2030 is

12

$1,054 and with a 22.5x multiple, the terminal value is $23,722 and $13,246 on a present value

basis. Summing up the present value of cash flows and the terminal value, we obtain an enterprise

value of $15,915, which results in $1,289.81 equity value per share. Similar to the perpetuity

growth method, we conducted a sensitivity analysis on enterprise value, equity value and equity

value per share.

V. Earnings-based Valuation

The Boston Beer Company, Inc. Earnings Based Valuation

PARAMETERS FY1 FY2 Ltg
EPS Forecasts 24.55 33.34 37.58% (using the mean analyst forecast)
Book value/share (last fye) 84.86 38.0%
Discount Rate 6.00%
Dividend Payout Ratio 0.000
Next Fsc Year end 2021
Current Fsc Mth (1 to 12) 5
Target ROE (industry avg.) 0.1500

Year 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
Long-term EPS Growth Rate (Ltg) 38.0% 38.0% 38.0% 40.0% 40.0%
Forecasted EPS $24.55 $33.34 $46.02 $63.52 $87.67 $122.74 $171.84
Beg. of year BV/Shr 84.86 109.41 142.75 188.77 252.29 339.96 462.70
Implied ROE 30.5% 32.2% 33.6% 34.8% 36.1% 37.1%

ROE 28.9% 30.5% 32.2% 33.6% 34.8% 36.1% 37.1% 32.7% 28.3% 23.9% 19.4% 15.0%
Abnormal ROE 22.9% 24.5% 26.2% 27.6% 28.8% 30.1% 31.1% 26.7% 22.3% 17.9% 13.4% 9.0%
Beg of year BV/shr 84.86 109.41 142.75 188.77 252.29 339.96 462.70 634.54 842.10 1,080.27 1,337.97 1,597.90
End of year BV/shr 109.41 142.75 188.77 252.29 339.96 462.70 634.54 842.10 1,080.27 1,337.97 1,597.90 1,837.59
Required rate (r) 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0%
Discount rate 1.060 1.124 1.191 1.262 1.338 1.419 1.504 1.594 1.689 1.791 1.898 2.012
Perpetuity 305.95 397.17 524.11 689.01 903.37 1,202.47 1,596.98 1,772.31 1,851.10 1,795.09 1,577.35 1,191.16
PV of Abnormal ROE 0.22 0.22 0.22 0.22 0.21 0.21 0.21 0.17 0.13 0.10 0.07 0.04
Incremental value each year 18.36 23.83 31.45 41.34 54.20 72.15 95.82 106.34 111.07 107.71 94.64 71.47
Cumulative Incremental value 18.36 42.19 73.63 114.97 169.18 241.33 337.14 443.48 554.55 662.25 756.89 828.36
Implied price $419.40 $537.32 $699.67 $911.07 $1,186.35 $1,566.87 $2,069.45 $2,358.17 $2,552.77 $2,605.76 $2,479.58 $2,157.00

13

The EPS forecasts for SAM was $24.55 and $33.34 in 2021 and 2022 respectively.6 The EPS

growth estimate for the next 5 years is 37.58% and our current discount rate assumption is 6%.

The current ROE for the company is 26.78%, but since the company is currently in a growth stage,

it would be more suitable to use industry ROEs for our assumptions. For the industry ROE, I took

the overall average of the industry average for Breweries for the past 3 years of 11.6% and the

industry average for Distilleries and Vintners for the past 3 years of 18.4% to get 15% as the Target

ROE.7 Since Boston Beer Company is both a craft brewer and a market leader in hard seltzers and

teas, it is suitable to use both industries as a guideline. This earnings-based valuation brings us to

an implied share price range of $911.07 – $1,186.35 when looking at the company 4-5 years down

the road. With a current share price of $1,108.42, as of 5/14/2021, the company’s value in the

market is in line with our valuation.

VI. Multiples-based Valuation

We performed a multiples-based valuation through the application of the guideline public

company method. We derived market multiples from the trading prices of companies that are

engaged in a similar line of business and that are actively traded on the public market. Noted is

that it is challenging to identify pure play publicly traded companies comparable to SAM given its

high growth seltzer business unit; however, we defined the following publicly traded companies

as the closest peer group:

6 Yahoo Finance
7 Capital IQ

14

When determining the appropriate multiple range, we considered SAM’s operating performance,

historical and project growth rates, and capitalization relative to the comparable companies.

We noted that SAM’s EBITDA and EBIT margins were below both the average and median of the

comparable companies, however, its net income margin (FY+1 and FY+2) was in line with the

comparable companies.

($ in millions, except per share data)

Company Name Ticker Share Price Market Cap Enterprise Value

Constellation Brands, Inc. NYSE:STZ 230.87 44,704 55,556
Molson Coors Beverage Company NYSE:TAP 58.38 12,442 20,638
Carlsberg A/S CPSE:CARL B 182.08 28,043 32,300
Anheuser-Busch InBev SA/NV ENXTBR:ABI 74.82 146,918 242,864
Heineken N.V. ENXTAM:HEIA 118.77 68,530 86,883
Tsingtao Brewery Company Limited SEHK:168 10.09 17,522 14,666
Diageo plc LSE:DGE 46.44 108,700 128,997
Pernod Ricard SA ENXTPA:RI 209.06 54,465 64,498
Kirin Holdings Company, Limited TSE:2503 19.23 16,031 22,485

Comparable Company Operating Statistics

($ in millions) LTM Margins FY+1 Margins FY+2 Margins

Company Name EBITDA EBIT Net Income EBITDA EBIT Net Income EBITDA EBIT Net Income

The Boston Beer Company, Inc. 19.0% 14.3% 11.1% 20.8% 15.2% 11.9% 21.2% 17.6% 13.8%

Constellation Brands, Inc. 43.3% 36.1% 23.2% 36.9% 33.2% 22.3% 37.5% 33.4% 23.0%
Molson Coors Beverage Company 25.3% 16.5% (7.9%) 21.1% 12.9% 8.3% 21.1% 13.1% 8.7%
Carlsberg A/S 23.8% 16.4% 10.3% 23.6% 16.6% 10.3% 24.0% 17.2% 10.8%
Anheuser-Busch InBev SA/NV 34.5% 26.1% 4.8% 36.0% 27.0% 11.5% 37.1% 28.2% 13.0%
Heineken N.V. 18.9% 9.8% (1.0%) 22.1% 14.6% 8.5% 23.7% 16.5% 10.1%
Tsingtao Brewery Company Limited 12.8% 9.1% 8.8% 14.3% 11.5% 8.7% 15.0% 12.7% 9.2%
Diageo plc 34.3% 30.7% 9.8% 33.7% 30.2% 21.8% 35.1% 31.5% 23.1%
Pernod Ricard SA 30.3% 25.8% 3.3% 30.0% 26.2% 17.0% 30.9% 27.3% 18.3%
Kirin Holdings Company, Limited 13.0% 8.9% 3.9% 13.1% 8.1% 5.5% 14.4% 9.6% 6.5%

Low 12.8% 8.9% (7.9%) 13.1% 8.1% 5.5% 14.4% 9.6% 6.5%
High 43.3% 36.1% 23.2% 36.9% 33.2% 22.3% 37.5% 33.4% 23.1%

75th Percentile 34.3% 26.1% 9.8% 33.7% 27.0% 17.0% 35.1% 28.2% 18.3%
Average 24.1% 17.9% 4.0% 24.2% 18.4% 11.5% 25.2% 19.5% 12.5%
Median 25.3% 16.5% 4.8% 23.6% 16.6% 10.3% 24.0% 17.2% 10.8%

15

In terms of both historical and projected growth rates, SAM far exceed the average and median (as

well as the high end) growth rates of the comparable companies.

The brewer and distiller industry is a highly leveraged industry. The average Total Debt to

EBITDA is 3.36x and Net Debt to EBITDA is 3.11x. SAM, as of FY 20, did not have any interest-

bearing debt on its balance sheet.

Based on the analysis of SAM relative to its comparable companies, we considered LTM, FY+1,

and FY+2 TEV / Revenue and TEV / EBITDA multiples. Ultimately, we determined that EBITDA

was the most appropriate financial metric to value SAM given it is the most common metric used

in the brewer/distiller industry. Additionally, given the significant growth expected in the seltzer

market, and SAM’s competitive position, we determined that averaging the FY+1 and FY+2

Comparable Company Growth Rates

($ in millions) 2-Year Hist. 1-Year Hist. LTM 1-Year Proj. 2-Year Proj.

Company Name Revenue EBITDA Revenue EBITDA Revenue EBITDA Revenue EBITDA Revenue EBITDA

The Boston Beer Company, Inc. 32.1% 38.3% 38.9% 53.6% 46.8% 84.4% 43.1% 56.9% 34.4% 42.0%

Constellation Brands, Inc. 3.0% (14.2%) 3.3% 322.0% 3.3% 322.0% (1.0%) (15.6%) (0.5%) (7.3%)
Molson Coors Beverage Company (5.3%) (0.9%) (10.7%) (0.5%) (10.7%) (0.5%) 5.3% (4.3%) 4.0% (0.9%)
Carlsberg A/S 0.2% 5.9% (2.8%) 2.7% (2.8%) 2.7% 7.7% 6.6% 7.0% 7.4%
Anheuser-Busch InBev SA/NV (6.0%) (12.9%) (7.9%) (20.3%) (7.9%) (20.3%) 11.0% 14.2% 7.9% 11.1%
Heineken N.V. (3.2%) (10.5%) (10.3%) (27.9%) (10.3%) (27.9%) 6.7% 25.0% 7.2% 20.2%
Tsingtao Brewery Company Limited 4.9% 19.8% 15.4% 55.4% 15.4% 55.4% 9.7% 27.7% 7.7% 19.1%
Diageo plc (4.8%) (6.3%) (4.6%) (11.4%) (4.6%) (11.4%) 20.0% 13.5% 12.5% 11.6%
Pernod Ricard SA (3.3%) (0.8%) (6.8%) (7.5%) (6.8%) (7.5%) 10.3% 7.2% 9.1% 9.1%
Kirin Holdings Company, Limited 0.9% (4.3%) 0.3% (8.3%) 0.3% (8.3%) (5.2%) (4.5%) (1.2%) 3.8%

Low (6.0%) (14.2%) (10.7%) (27.9%) (10.7%) (27.9%) (5.2%) (15.6%) (1.2%) (7.3%)
High 4.9% 19.8% 15.4% 322.0% 15.4% 322.0% 20.0% 27.7% 12.5% 20.2%

75th Percentile 0.9% (0.8%) 0.3% 2.7% 0.3% 2.7% 10.3% 14.2% 7.9% 11.6%
Average (1.5%) (2.7%) (2.7%) 33.8% (2.7%) 33.8% 7.2% 7.7% 6.0% 8.2%
Median (3.2%) (4.3%) (4.6%) (7.5%) (4.6%) (7.5%) 7.7% 7.2% 7.2% 9.1%

Comparable Company Capitalization

($ in millions) Total Debt to: Net Debt to:

Company Name Market Cap TEV Book Equity Cash Total Debt Net Debt Book Equity Total Capital EBITDA EBITDA

The Boston Beer Company, Inc. 13,339 13,175 958 163 0 (163) NMF NMF NMF NMF

Constellation Brands, Inc. 44,704 55,556 13,929 461 10,442 9,982 0.75 0.43 2.80 2.68
Molson Coors Beverage Company 12,442 20,638 12,834 533 8,327 7,794 0.65 0.39 3.49 3.26
Carlsberg A/S 28,043 32,300 7,126 1,330 4,971 3,641 0.70 0.41 2.17 1.59
Anheuser-Busch InBev SA/NV 146,918 242,864 78,351 15,648 98,564 82,916 1.26 0.56 5.92 4.98
Heineken N.V. 68,530 86,883 17,605 4,893 22,258 17,365 1.26 0.56 4.89 3.81
Tsingtao Brewery Company Limited 17,522 14,666 3,430 3,095 124 (2,971) 0.04 0.03 0.21 NMF
Diageo plc 108,700 128,997 11,438 3,887 21,417 17,530 1.87 0.65 4.00 3.28
Pernod Ricard SA 54,465 64,498 17,956 2,391 12,254 9,863 0.68 0.41 4.16 3.34
Kirin Holdings Company, Limited 16,031 22,485 10,619 1,643 6,090 4,446 0.57 0.36 2.61 1.91

Low 12,442 14,666 3,430 461 124 (2,971) 0.04 0.03 0.21 1.59
High 146,918 242,864 78,351 15,648 98,564 82,916 1.87 0.65 5.92 4.98

75th Percentile 68,530 86,883 17,605 3,887 21,417 17,365 1.26 0.56 4.16 3.46
Average 55,262 74,321 19,254 3,765 20,494 16,730 0.86 0.42 3.36 3.11
Median 44,704 55,556 12,834 2,391 10,442 9,863 0.70 0.41 3.49 3.27

16

implied enterprise value indications would be most representative considering SAM’s high level

of growth expectations.

For the FY+1 EBITDA multiple, we selected 20.5x as the mid-point, notching up and down by

1.5x to form a range of indications. 20.5x EBITDA is equal to the 75th percentile EBITDA

multiples for the comparable companies. For the FY+2 EBITDA multiple, we selected 18.5x as

the mid-point, notching up and down by 1.5x. 18.5x EBITDA is equal to the 75th percentile

EBITDA multiples for the comparable companies.

Averaging the two enterprise indications ranges result in an enterprise value range of $10.6bn to

$12.3bn, with a mid-point of $11.5bn and equity value per share of $860.70 to $1,002.96, with a

mid-point of $931.83.

The Boston Beer Company, Inc. Comparable Company Analysis

($ in millions, except per share data) LTM FY+1 FY+2

Comparable Companies Revenue EBITDA Revenue EBITDA Revenue EBITDA

Constellation Brands, Inc. 6.4x 14.9x 6.5x 17.7x 6.5x 17.4x
Molson Coors Beverage Company 2.2x 8.6x 2.0x 9.6x 2.0x 9.4x
Carlsberg A/S 3.4x 14.1x 3.1x 13.2x 2.9x 12.2x
Anheuser-Busch InBev SA/NV 5.0x 14.6x 4.7x 13.0x 4.4x 12.0x
Heineken N.V. 3.6x 19.1x 3.4x 15.3x 3.1x 13.2x
Tsingtao Brewery Company Limited 3.2x 24.8x 3.1x 22.0x 3.0x 19.8x
Diageo plc 8.3x 24.1x 7.4x 21.9x 7.0x 20.0x
Pernod Ricard SA 6.6x 21.9x 6.2x 20.5x 5.7x 18.5x
Kirin Holdings Company, Limited 1.3x 9.6x 1.3x 10.1x 1.3x 8.9x

High 8.3x 24.8x 7.4x 22.0x 7.0x 20.0x
75th Percentile 6.4x 21.9x 6.2x 20.5x 5.7x 18.5x
Median 3.6x 14.9x 3.4x 15.3x 3.1x 13.2x

The Boston Beer Company, Inc.

EBITDA Multiple Range Implied Enterprise Value Range
LTM 330 x 21.0x 22.5x 24.0x = 6,922 7,417 7,911
FY+1 517 x 19.0x 20.5x 22.0x = 9,825 10,601 11,376
FY+2 665 x 17.0x 18.5x 20.0x = 11,307 12,304 13,302

Selected implied enterprise value range FY+1 9,825 10,601 11,376
FY+2 11,307 12,304 13,302

Average 10,566 11,452 12,339

Valuation Summary Range
Implied Enterprise Value $10,566 $11,452 $12,339
Net debt ($163) ($163) ($163)
Equity value $10,729 $11,616 $12,502
Equity value per share $860.70 $931.83 $1,002.96

17

VII. Investment Consensus

We believe that Boston Beer Company is properly valued based on our valuations performed

below relative to its current share price of $1,108.42 as of 5/14/2021.

The current share price lies between the mid to upper ranges of our Earnings Based Valuation and

DCF Gordon Growth Valuation and in between our Relative Valuation and DCF Exit Multiple

Valuation.

We don’t believe that Boston Beer Company is an attractive investment at this time due to the

uncertainty of how increased competition will affect the hard seltzer market and whether or not

Boston Beer Company will be able to sustain its lead with its operational efficiencies falling behind

those of its peers. Truly will undoubtedly sustain the company’s growth projections as we head

Premium/(Discount) to Current Price $1,108.42
Lower Mid Upper

Earnings Based Valuation (17.8%) (5.4%) 7.0%

DCF – Gordon Growth (22.7%) (8.5%) 15.2%

DCF – Exit Multiple 7.8% 16.4% 24.9%

Comparable Companies (22.3%) (15.9%) (9.5%)

18

back into normalcy. However, we believe that without innovation in product offering and back-

end efficiencies Boston Beer Company may find itself in a situation where competition is

beginning to take away significant market share. The company has also seen major growth recently

in its share price, leaving little room for error based on our current valuation analysis.

https://www.sec.gov/Archives/edgar/data/1318605/000095017022000796/tsla-20211231.htm




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