# AMD – DCF (2026-11-10)

Sample run by the Fair Value Coordinator. Method: 5-year explicit FCF forecast + Gordon growth terminal value, cross-checked with the implied terminal FCF multiple.

## Inputs
- Risk-free (10Y UST, 2026-11-10): 4.98%; ERP 5.0%; beta (5Y observed) 2.54 -> cost of equity 17.68%
- Cost of debt: 10Y + 1.0% spread (coordinator assumption), 21% tax -> 4.72% after tax; weights at market cap $844.99B / total debt $9.21B -> **WACC 17.54%**
- Year-1 FCF = consensus FY1 FCF $6.85B (FY ending Dec 31, 2026); TTM FCF $7.06B.
- Growth path (FCF grows with revenue, constant FCF margin): years 2-3 at consensus 3Y revenue CAGR 57.4%, then fades linearly to terminal g by year 5
- Net cash (debt): $6.57B; shares 1,640M (market cap / price; basic, not fully diluted)
- Scenarios: bear = 90% of year-1 FCF, half the growth rate, g 2.0%; base = as above, g 2.5%; bull = 110% of year-1 FCF, 1.25x growth, g 3.0%; all at base WACC

## Result (per share, vs close $515.21)
| Bear | Base | Bull |
|---|---|---|
| $46.33 | **$86.78** | $124.02 |

Base-case year 1-5 FCF ($B): 6.8, 10.8, 17.0, 23.6, 28.5. Terminal value is 64% of EV; implied terminal multiple 6.8x year-5 FCF (exit-multiple cross-check).

## Sensitivity (base case, $/share)
| WACC \ g | 2.0% | 2.5% | 3.0% |
|---|---|---|---|
| 16.54% | $91.31 | $93.89 | $96.65 |
| 17.54% | $84.59 | $86.78 | $89.12 |
| 18.54% | $78.71 | $80.59 | $82.59 |

Sources: see data/2026-11-10/AMD.md