Las Vegas Sands Corp.LVSNYSE

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DCF Valuation

DCF Valuation Summary

Sell

Fair Value: $50.05 per share(market-calibrated)

-10.1%

Upside to Fair Value

Current

$55.70

Pure Model

$49.40

Fair Value

$50.05

Bull Case

$64.66

Bear Case

$36.59

Market Reality Check

Model Terminal Growth

3.00%

Market-Implied Growth

3.70%

Calibrated Growth

3.10%

Fair value uses 85% model / 15% market-implied terminal growth. Pure model: $49.40.

What's Driving This Ratingfor LVS

↓

CapEx normalizing toward maintenance

Historical CapEx is 8.64% of revenue (heavy investment phase). Model fades this to 4.00% by Year 10, freeing up ~$854M in annual FCF. This is the biggest driver of long-term cash flow improvement.

↑

Margin expansion modeled

Current EBIT margin is 6.94% — below the sector mature average of 23.73%. Model expands margins as the business scales and operating leverage kicks in. Year 10 EBIT reaches $2.0B (10.94% margin).

→

Moderate revenue growth

Analyst consensus projects 5.77% revenue growth, fading to 3.00% by Year 10. Revenue reaches $18.4B (vs $13.0B today).

✓

Model and market roughly agree

Market-implied terminal growth of 3.70% is close to the model's 3.00% (only 70bps apart). The DCF assumptions are well-aligned with how the market is pricing this stock.

✓

Strong cash flow conversion

Year 10 FCF/EBITDA conversion of 68.54% indicates efficient cash generation. FCF reaches $2.6B by Year 10 (14.20% FCF margin).

Weighted Average Cost of Capital (WACC)

Cost of Equity (CAPM)

Risk-Free Rate (Rf)4.50%

Beta (β)0.89

Market Risk Premium4.50%

*Using current implied premium (4.5% per Damodaran 2026), not historical (6.5%)

Cost of Equity (Re)8.50%

Cost of Debt

Pre-tax Cost of Debt4.48%

Tax Rate15.68%

After-tax Cost of Debt3.78%

Equity Weight (E/V)70.46%

Debt Weight (D/V)29.54%

WACC Calculation

WACC = (E/V × Re) + (D/V × Rd × (1-Tc))

WACC = (70.46% × 8.50%) + (29.54% × 3.78%)

= 7.10%

10-Year Free Cash Flow Projections(showing years 1, 3, 5, 7, 10)

Year	Year 1	Year 3	Year 5	Year 7	Year 10
Revenue	$13.8B	$14.9B	$15.9B	$16.8B	$18.4B
EBIT	$956M	$1.0B	$1.4B	$1.7B	$2.0B
Tax	$150M	$162M	$218M	$262M	$316M
NOPAT	$806M	$873M	$1.2B	$1.4B	$1.7B
+ Depreciation	$1.3B	$1.5B	$1.6B	$1.6B	$1.8B
- Capex	$1.2B	$1.1B	$1.0B	$934M	$736M
- Δ NWC	$207M	$144M	$127M	$135M	$147M
Free Cash Flow	$755M	$1.1B	$1.6B	$2.0B	$2.6B
Discount Factor	0.934	0.814	0.710	0.619	0.504
Present Value	$705M	$856M	$1.1B	$1.2B	$1.3B

FCF Formula: Free Cash Flow = NOPAT + Depreciation - Capex - Change in Net Working Capital

Terminal Value Calculation

Perpetuity Growth Method

Year 10 FCF$2.6B

Terminal Growth Rate3.00%

WACC7.10%

TV = FCF₁₀ × (1+g) / (WACC-g)

Terminal Value$65.6B

PV of Terminal Value$33.0B

Exit Multiple Method

Year 10 EBITDA$3.8B

Exit Multiple (EV/EBITDA)20.0x

TV = EBITDA₁₀ × Exit Multiple

Terminal Value$76.2B

PV of Terminal Value$38.4B

Valuation Summary

Perpetuity Growth Method

PV of Projected FCFs$10.7B

PV of Terminal Value$33.0B

Enterprise Value$43.8B

(-) Net Debt$12.3B

Equity Value$31.5B

Shares Outstanding691M

Price per Share$45.53

Exit Multiple Method

PV of Projected FCFs$10.7B

PV of Terminal Value$38.4B

Enterprise Value$49.1B

(-) Net Debt$12.3B

Equity Value$36.8B

Shares Outstanding691M

Price per Share$53.27

Pure Model Fair Value

$49.40

Average of perpetuity growth and exit multiple methods (before market calibration)

Sensitivity AnalysisPrice per Share

WACC ↓ / Growth →	2.00%	2.50%	3.00%	3.50%	4.00%
5.10%	$70.95	$78.43	$89.47	$88.77	$84.41
6.10%	$55.14	$58.89	$63.85	$70.72	$80.86
7.10%	$44.53	$46.70	$49.40	$52.85	$57.41
8.10%	$36.69	$38.06	$39.70	$41.70	$44.18
9.10%	$30.54	$31.46	$32.54	$33.80	$35.31

How to read: This table shows how the valuation changes with different WACC (discount rate) and terminal growth rate assumptions. Green = undervalued, Red = overvalued.

Scenario Analysis

Bear Case

$36.59

-34.3% vs current

• -25% vs analyst consensus
• Terminal growth: 2.5%
• Beta: 1.11

Base Case

$49.40

-11.3% vs current

• Analyst consensus
• Terminal growth: 3.0%
• Beta: 0.89

Bull Case

$64.66

16.1% vs current

• +25% vs analyst consensus
• Terminal growth: 3.5%
• Beta: 0.75

Key Assumptions & Drivers• Consumer Cyclical Sector

Growth Assumptions (Select Years)

Year 1 Revenue Growth5.77%

Year 3 Revenue Growth3.63%

Year 5 Revenue Growth3.00%

Year 7 Revenue Growth3.00%

Year 10 Revenue Growth3.00%

Terminal Growth Rate3.00%

Margin & Efficiency

Current EBIT Margin6.94%

Terminal EBIT Margin23.73%

Tax Rate15.68%

Historical Capex / Rev8.64%

Terminal Capex / Rev4.00%

NWC / Revenue27.52%

Key Drivers: Revenue growth, operating margin expansion, capex efficiency, and working capital management are the primary drivers of cash flow generation. Terminal value assumptions significantly impact final valuation.

Institutional-Grade Methodology

Actual Company Data: Revenue, EBIT, Capex, NWC, Tax Rate, Interest Expense, Beta

Market Assumptions: Risk-free: 4.5% (10Y), MRP: 4.5% (Damodaran 2026), Exit: 20x EV/EBITDA (Consumer Cyclical sector)

This DCF model is for informational purposes only. Projections are based on assumptions that may not materialize. Past performance does not guarantee future results. Consult a financial advisor before making investment decisions.

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