NEC.AX
NINE ENT FPO [NEC]OpenNEC.AX discounted cash flow valuation
NEC.AX Fair Value
Reverse DCF: today's price implies 22.0% a year of FCF growth for years 1–5, against 2.8% in this model.
Model: 2.8% from analyst next-year revenue growth. Fades linearly to terminal growth by year 10.
Model: 7.19% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | AUD 285.06M |
|---|---|
| PV of terminal value (67% of EV) | AUD 579.06M |
| Enterprise value | AUD 864.12M |
| + Cash & investments | AUD 92.39M |
| − Total debt | −AUD 1.67B |
| Equity value | −AUD 713.26M |
| ÷ Shares outstanding | 1.59B |
| Value per share | AUD -0.4498 |
| Market cap | AUD 1.03B |
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.19% |
|---|---|
| Beta (adjusted toward 1) | 0.96 |
| Equity risk premium | 4.50% |
| Cost of equity (CAPM) | 9.53% |
| Pre-tax cost of debt | 5.19% |
| Tax rate | 29.5% |
| Debt / (equity + debt) | 61.9% |
| WACC | 7.19% |
Beta is Yahoo's, held between 0.5 and 2.5, then moved a third of the way toward 1. Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%. WACC is at least the risk-free rate plus 2%, which applies here.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 2.00% | 2.50% | 3.00% | 3.50% | 4.00% |
|---|---|---|---|---|---|
| 5.19% | -0.2407 | -0.1235 | 0.0471 | 0.3187 | 0.8184 |
| 6.19% | -0.4214 | -0.3599 | -0.2792 | -0.1685 | -0.007247 |
| 7.19% | -0.5325 | -0.4955 | -0.4498 | -0.3917 | -0.3153 |
| 8.19% | -0.6076 | -0.5835 | -0.5546 | -0.5197 | -0.4764 |
| 9.19% | -0.6618 | -0.6451 | -0.6256 | -0.6027 | -0.5755 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (FY2026) | — | AUD 35.58M | — | — |
| Year 1 | 2.8% | AUD 36.57M | 0.933 | AUD 34.12M |
| Year 2 | 2.8% | AUD 37.60M | 0.870 | AUD 32.72M |
| Year 3 | 2.8% | AUD 38.65M | 0.812 | AUD 31.38M |
| Year 4 | 2.8% | AUD 39.73M | 0.758 | AUD 30.10M |
| Year 5 | 2.8% | AUD 40.85M | 0.707 | AUD 28.87M |
| Year 6 | 2.8% | AUD 42.01M | 0.659 | AUD 27.69M |
| Year 7 | 2.9% | AUD 43.22M | 0.615 | AUD 26.58M |
| Year 8 | 2.9% | AUD 44.48M | 0.574 | AUD 25.52M |
| Year 9 | 3.0% | AUD 45.79M | 0.535 | AUD 24.51M |
| Year 10 | 3.0% | AUD 47.17M | 0.499 | AUD 23.56M |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else next year's revenue growth (steadier than one year's EPS), else next year's EPS growth, else revenue CAGR, held between −2% and 25%. Terminal growth defaults to 3%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.