# GOOG – Alphabet – DCF (2026-11-11)

DCF Analyst model, rerun by Fair Value Coordinator on today's data. Input file: `data/2026-11-11/GOOG.md`. Generated 2026-11-11 07:16 MST (Phoenix).

> **PROVISIONAL:** TTM FCF depressed/negative from capex step-up; margin ramps to pre-surge normalized level (judgment).

**Price used:** $284.92 (regular-session close Nov 10, 2026). Shares 12,294M (diluted/implied, Yahoo impliedSharesOutstanding per Data Collector 2026-11-11).

| Scenario | $/share | vs price | Start rev growth | FCF margin (after SBC) yr1→yr5 | WACC | g |
|---|---|---|---|---|---|---|
| Bear | $46.30 | -84% | 12.3% fading to 4.5% | -2.3% → 8.8% | 11.9% | 2.5% |
| Base | **$83.89** | -71% | 22.1% fading to 6.4% | -2.3% → 11.7% | 10.9% | 2.5% |
| Bull | $101.96 | -64% | 24.6% fading to 6.9% | -2.3% → 11.7% | 9.9% | 2.5% |

## WACC build
- Risk-free: 10Y UST 5.0% (Nov 10, 2026 close per Data Collector; bond market closed Nov 11 for Veterans Day)
- Beta: 1.23 (5Y observed (Data Collector)); ERP 5.0% → cost of equity 11.1%
- Cost of debt: 10Y + 1.0% spread (assumption; no interest-rate data in inputs) = 6.0% pre-tax, 4.7% after 21% tax
- Weights (market): equity 95.9% / debt 4.1% (mkt cap $3,500.0B, debt $150.3B)
- WACC 10.9% → **10.9%**

## Key assumptions
| Item | Value | Basis |
|---|---|---|
| TTM revenue | $471.1B | Data Collector |
| TTM OCF / capex / FCF | $179.6B / $-159.8B / $19.8B | Data Collector |
| TTM SBC | $30.4B (6.5% of rev; 154.0% of FCF) | stockanalysis cash-flow, TTM to Sep 30 2026 |
| FCF after SBC (base yr-0) | $-10.7B = -2.3% margin | OCF − capex − SBC |
| Consensus revenue | FY1 (FY ending Dec 31, 2026): $499.7B; FY2 $637.6B (FY2/FY1 27.6%); 3Y CAGR 24.6% | Data Collector |
| Consensus FCF FY1 | $-18.4B | Data Collector (pre-SBC) |
| Consensus-level start growth | 24.6% = lower of 3Y CAGR and FY2/FY1 | conservative |
| Base / bear / bull start growth | 22.1% (90%) / 12.3% (50%) / 24.6% (100%) of consensus; linear fade toward g | |
| Net cash (debt) | $114.8B | Data Collector |
| Normalized margin (yr5 target) | 11.7% after SBC (bear 75% of it) | TTM to Dec 31 2025 FCF margin 18.19% (before the 2026 AI capex step-up) minus current SBC/rev |

## Base-case 5-year FCF ($B)
| Year | Rev growth | Revenue | FCF margin | FCF | PV |
|---|---|---|---|---|---|
| 1 | 22.1% | 575.4 | -2.3% | -13.0 | -11.7 |
| 2 | 18.2% | 680.2 | 1.2% | 8.4 | 6.8 |
| 3 | 14.3% | 777.4 | 4.7% | 36.8 | 27.0 |
| 4 | 10.4% | 857.9 | 8.2% | 70.7 | 46.8 |
| 5 | 6.4% | 913.0 | 11.7% | 107.1 | 64.0 |

## Terminal value check (base)
- Gordon TV $1,312.7B, PV $783.7B; EV $916.6B; TV share of EV 85.5% **⚠ above 75%**
- Implied exit multiple 12.3x year-5 FCF vs current EV/FCF TTM 173.3x (pre-SBC)
- FCF margin (after SBC, flat, base growth/WACC) needed to justify $284.92: **35.9%** vs TTM -2.3%

## Sensitivity – base case $/share (WACC vs terminal g)
| WACC \ g | 2.0% | 2.5% | 3.0% |
|---|---|---|---|
| 9.9% | $91.18 | $96.34 | $102.26 |
| 10.4% | $85.25 | $89.71 | $94.78 |
| 10.9% | $80.00 | $83.89 | $88.27 |
| 11.4% | $75.33 | $78.74 | $82.56 |
| 11.9% | $71.15 | $74.16 | $77.51 |

## Sources
- - Yahoo Finance quoteSummary API (`price`, `summaryDetail`, `defaultKeyStatistics`, `financialData`, `calendarEvents`, `earningsTrend`, `incomeStatementHistory`): https://query2.finance.yahoo.com/v10/finance/quoteSummary/GOOG — fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix) / Nov 11, 2026, 7:24 AM ET
- Yahoo Finance chart API (pre/post included) close/pre-market cross-check: https://query1.finance.yahoo.com/v8/finance/chart/GOOG — fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix)
- stockanalysis.com statistics (S&P Global Market Intelligence): https://stockanalysis.com/stocks/goog/statistics/ — stats updated Nov 11, 2026, fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix)
- stockanalysis.com forecast (S&P Global Market Intelligence): https://stockanalysis.com/stocks/goog/forecast/ — forecast updated Oct 30, 2026, fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix)
- stockanalysis.com financials & cash-flow statement pages: https://stockanalysis.com/stocks/goog/financials/ and .../financials/cash-flow-statement/ — fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix)
- Yahoo Finance news search: https://query1.finance.yahoo.com/v1/finance/search?q=GOOG — fetched Nov 11, 2026, 5:24 AM MST (America/Phoenix)
- 10-year Treasury (for WACC context): 4.98% on Nov 10, 2026 (latest; Nov 11 is Veterans Day and the Treasury auction/bond market is closed). Source: https://home.treasury.gov daily par yield curve, November 2026 view.
- TTM SBC: https://stockanalysis.com/stocks/goog/financials/cash-flow-statement/?p=trailing (fetched 2026-11-11 ~05:25 MST)

## Caveats
- SBC treated as a cash cost (subtracted from FCF) – conservative; pre-SBC values would be materially higher.
- Shares are Yahoo implied/diluted (rerun by Coordinator on data/2026-11-11); cost of debt is a 10Y+100bp assumption.
- Revenue start point is TTM; consensus FY1/FY2 periods may not align with TTM. Mid-year discounting not applied (end-year, conservative).