As of May 23, 2025, Taylor Wimpey PLC has a Discounted Cash Flow (DCF) derived fair value of $55.54 per share. With the current market price at $117.60, this represents a potential upside of -52.8%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $59.71 |
| DCF Fair Value (10-year) | $55.54 |
| Potential Upside (5-year) | -49.2% |
| Potential Upside (10-year) | -52.8% |
| Discount Rate (WACC) | 9.7% - 14.1% |
Revenue is projected to grow from $3401 million in 12-2024 to $4470 million by 12-2034, representing a compound annual growth rate of approximately 2.8%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 3401 | 3% |
| 12-2025 | 3567 | 5% |
| 12-2026 | 3638 | 2% |
| 12-2027 | 3711 | 2% |
| 12-2028 | 3841 | 4% |
| 12-2029 | 3918 | 2% |
| 12-2030 | 3999 | 2% |
| 12-2031 | 4079 | 2% |
| 12-2032 | 4174 | 2% |
| 12-2033 | 4257 | 2% |
| 12-2034 | 4470 | 5% |
Net profit margin is expected to improve from 6% in 12-2024 to 7% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 220 | 6% |
| 12-2025 | 261 | 7% |
| 12-2026 | 266 | 7% |
| 12-2027 | 272 | 7% |
| 12-2028 | 281 | 7% |
| 12-2029 | 287 | 7% |
| 12-2030 | 293 | 7% |
| 12-2031 | 299 | 7% |
| 12-2032 | 306 | 7% |
| 12-2033 | 312 | 7% |
| 12-2034 | 327 | 7% |
with a 5-year average of $5 million. Projected CapEx is expected to maintain at approximately 0% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 4 |
| 12-2026 | 5 |
| 12-2027 | 5 |
| 12-2028 | 5 |
| 12-2029 | 6 |
| 12-2030 | 6 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 11 |
| Days Inventory | 654 |
| Days Payables | 27 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2025 | 319 | 75 | 5 | (443) | 682 |
| 2026 | 326 | 76 | 5 | 356 | (112) |
| 2027 | 333 | 78 | 5 | 182 | 68 |
| 2028 | 344 | 81 | 6 | 57 | 201 |
| 2029 | 352 | 82 | 6 | 183 | 81 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 59.71 | -49.2% |
| 10-Year DCF (Growth) | 55.54 | -52.8% |
| 5-Year DCF (EBITDA) | 87.20 | -25.9% |
| 10-Year DCF (EBITDA) | 77.40 | -34.2% |
Is Taylor Wimpey PLC (TW.L) a buy or a sell? Taylor Wimpey PLC is definitely a sell. Based on our DCF analysis, Taylor Wimpey PLC (TW.L) appears to be overvalued with upside potential of -52.8%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider reducing exposure at the current market price of $117.60.