/*
    Model: Discounted Free Cash Flow - Exit Multiple
    
    © Copyright: 
        Discounting Cash Flows Inc. (discountingcashflows.com)
        8 The Green, Dover, DE 19901
*/

Input(
  {
    _DISCOUNT_RATE: '',
    _REVENUE_GROWTH_RATE: '',
    EXIT_EBITDA_MULTIPLE: '',
    _EBITDA_MARGIN: '',
    _CAPITAL_EXPENDITURE_TO_EBITDA: '',
    _OPERATING_CASH_FLOW_TO_EBITDA: '',
    BETA:'',
    _RISK_FREE_RATE: '',
    _MARKET_PREMIUM: '',
    PROJECTION_YEARS: 5,
    HISTORICAL_YEARS: 10,
  },
  [{
    parent:'_DISCOUNT_RATE',
    children:['BETA', '_RISK_FREE_RATE', '_MARKET_PREMIUM']
  }]
);

$.when(
  get_income_statement(),
  get_income_statement_ltm(),
  get_balance_sheet_statement_quarterly('length:2'),
  get_cash_flow_statement(),
  get_cash_flow_statement_ltm(),
  get_profile(),
  get_treasury(),
  get_fx(),
  get_risk_premium()).done(
  function($income, $income_ltm, $balance_quarterly, $flows, $flows_ltm, $profile, $treasury, $fx, $risk_premium){
  try{
    var response = new Response({
      income: $income,
      income_ltm: $income_ltm,
      balance_quarterly: $balance_quarterly,
      balance_ltm: 'balance_quarterly:0',
      flows: $flows,
      flows_ltm: $flows_ltm,
      profile: $profile,
      treasury: $treasury,
      risk_premium: $risk_premium,
    }).toOneCurrency('income', $fx).merge('_ltm');
    response.balance_ltm['date'] = 'LTM';
	var currency = response.currency;
    // +---------------- ASSUMPTIONS SECTION -----------------+ 
    // Set beta (used in calculating the discount rate)
    if(response.profile.beta){
    	setAssumption('BETA', response.profile.beta);
    }
    else{
    	setAssumption('BETA', 1);
    }
    // Risk free rate is the yield of the 10 year treasury note
	setAssumption('_RISK_FREE_RATE', response.treasury.year10);
    setAssumption('_MARKET_PREMIUM', response.risk_premium.totalEquityRiskPremium );
    
    // Calculate the discount rate using the wacc formula
    var costOfEquity = getAssumption('_RISK_FREE_RATE') + getAssumption('BETA')*getAssumption('_MARKET_PREMIUM');
    var costOfDebt = response.income_ltm['interestExpense'] / response.balance_ltm['totalDebt'];
    var taxRate = response.income_ltm['incomeTaxExpense'] / response.income_ltm['incomeBeforeTax'];
    if(taxRate < 0)
    {
		taxRate = 0;
    }
    var marketCap = response.profile['price'] * response.income_ltm['weightedAverageShsOut'];
    
    var debtWeight = response.balance_ltm['totalDebt'] / (marketCap + response.balance_ltm['totalDebt']);
    var equityWeight = marketCap / (marketCap + response.balance_ltm['totalDebt']);
    var wacc = debtWeight * costOfDebt * (1 - taxRate) + equityWeight * costOfEquity;
    
    // Set the Discount Rate
    setAssumption('_DISCOUNT_RATE', toP(wacc));
    
    // Setup Original Data
    var original_data = new DateValueData({
      'revenue': new DateValueList(response.income, 'revenue'),
      'costOfRevenue': new DateValueList(response.income, 'costOfRevenue'),
      'grossProfit': new DateValueList(response.income, 'grossProfit'),
      'operatingIncome': new DateValueList(response.income, 'operatingIncome'),
      'netIncome': new DateValueList(response.income, 'netIncome'),
      'weightedAverageShsOut': new DateValueList(response.income, 'weightedAverageShsOut'),
      'operatingCashFlow': new DateValueList(response.flows, 'operatingCashFlow'),
      'capitalExpenditure': new DateValueList(response.flows, 'capitalExpenditure'),
      'freeCashFlow': new DateValueList(response.flows, 'freeCashFlow'),
      'calculatedEbitda': new DateValueList(response.income, 'calculatedEbitda'),
    });
    var currentDate = original_data.lastDate();
    var nextYear = currentDate + 1;
    var forecastEndDate = currentDate + getAssumption('PROJECTION_YEARS');
    
    // Compute historical values and ratios
    var historical_computed_data = original_data.setFormula({
      '_operatingCashFlowToEbitda': ['operatingCashFlow:0', '/', 'calculatedEbitda:0'],
      '_capitalExpenditureToEbitda': ['capitalExpenditure:0', '/', 'calculatedEbitda:0'],
      '_netIncomeToEbitda': ['netIncome:0', '/', 'calculatedEbitda:0'],
      '_freeCashFlowToEbitda': ['freeCashFlow:0', '/', 'calculatedEbitda:0'],
      '_grossMargin': ['grossProfit:0', '/', 'revenue:0'],
      '_operatingMargin': ['operatingIncome:0', '/', 'revenue:0'],
      '_ebitdaMargin': ['calculatedEbitda:0', '/', 'revenue:0'],
      'discountedFreeCashFlow': ['freeCashFlow:0'],
      '_revenueGrowthRate': ['function:growth_rate', 'revenue'],
    }).compute();
    
    const ebitdaMargin = historical_computed_data.get('_ebitdaMargin').sublist(nextYear - getAssumption('HISTORICAL_YEARS')).average();
    setAssumption('_EBITDA_MARGIN', toP(ebitdaMargin) );
    // Calculate the average historical margin of operatingCashFlow (Cash From Operating Activities)
    const operatingCashFlowMargin = historical_computed_data.get('_operatingCashFlowToEbitda').sublist(nextYear - getAssumption('HISTORICAL_YEARS')).average();
    setAssumption('_OPERATING_CASH_FLOW_TO_EBITDA', toP(operatingCashFlowMargin));
    // Is negative by default, se we need to make it positive
    const capitalExpenditureMargin = -historical_computed_data.get('_capitalExpenditureToEbitda').sublist(nextYear - getAssumption('HISTORICAL_YEARS')).average(); 
    setAssumption('_CAPITAL_EXPENDITURE_TO_EBITDA', toP(capitalExpenditureMargin));
    const averageRevenueGrowthRate = historical_computed_data.get('_revenueGrowthRate').sublist(nextYear - getAssumption('HISTORICAL_YEARS')).average();
    setAssumption('_REVENUE_GROWTH_RATE',  toP(averageRevenueGrowthRate));
    var ev = marketCap + response.balance_ltm['totalDebt'] - response.balance_ltm['cashAndShortTermInvestments'];
    setAssumption('EXIT_EBITDA_MULTIPLE', ev/response.income_ltm['calculatedEbitda']);
    
    // Compute forecasted values and ratios
    var forecasted_data = historical_computed_data.removeDate('LTM').setFormula({
      'linearRegressionRevenue': ['function:linear_regression', 'revenue', {slope: 1, start_date: nextYear - getAssumption('HISTORICAL_YEARS')}],
      'revenue': ['function:compound', 'linearRegressionRevenue:start_date', {rate: getAssumption('_REVENUE_GROWTH_RATE'), start_date: nextYear}],
      'calculatedEbitda': ['revenue', '*',  getAssumption('_EBITDA_MARGIN')],
      '_revenueGrowthRate': ['function:growth_rate', 'revenue'],
      'operatingCashFlow': ['calculatedEbitda', '*', getAssumption('_OPERATING_CASH_FLOW_TO_EBITDA')],
      'computedCapitalExpenditure': ['calculatedEbitda', '*', getAssumption('_CAPITAL_EXPENDITURE_TO_EBITDA')],
      'freeCashFlow': ['operatingCashFlow:0', '-', 'computedCapitalExpenditure:0'],
      'capitalExpenditure': ['freeCashFlow:0', '-', 'operatingCashFlow:0'],
      'discountedFreeCashFlow': ['function:discount', 'freeCashFlow', {rate: getAssumption('_DISCOUNT_RATE'), start_date: currentDate}],
      '_operatingCashFlowToEbitda': ['operatingCashFlow:0', '/', 'calculatedEbitda:0'],
      '_capitalExpenditureToEbitda': ['capitalExpenditure:0', '/', 'calculatedEbitda:0'],
      '_freeCashFlowToEbitda': ['freeCashFlow:0', '/', 'calculatedEbitda:0'],
      '_ebitdaMargin': ['calculatedEbitda:0', '/', 'revenue:0'],
    }).setEditable(_edit(), {
      start_date: nextYear,
      keys: ['revenue', 'operatingCashFlow', 'freeCashFlow', 'calculatedEbitda'],
    }).compute({'forecast_end_date': forecastEndDate});
    // +------------- END OF ASSUMPTIONS SECTION -------------+
    
    // +---------------- MODEL VALUES SECTION ----------------+
    // Calculating the Terminal Value
    // TV = EV/EBITDA * EBITDA = INPUT.EXIT_EBITDA_MULTIPLE * Last Forecasted EBITDA
    var terminalValue = getAssumption('EXIT_EBITDA_MULTIPLE') * forecasted_data.get('calculatedEbitda').valueAtDate(forecastEndDate);
    // Discount the terminal value into the present
    var discountedTerminalValue = terminalValue/Math.pow(1 + getAssumption('_DISCOUNT_RATE'), getAssumption('PROJECTION_YEARS'));
    // Add all Discounted FCFs and the Discounted Terminal Value to calculate the Projected Enterprise Value
    var projectedEnterpriseValue = discountedTerminalValue + forecasted_data.get('discountedFreeCashFlow').sublist(nextYear).sum();
    // Equity value is calculated by adding cash and subtracting total debt
    var equityValue = projectedEnterpriseValue + response.balance_ltm['cashAndShortTermInvestments'] - response.balance_ltm['totalDebt'];
    var valuePerShare = equityValue/original_data.get('weightedAverageShsOut').valueAtDate('ltm');
    
    // If we are calculating the value per share for a watch, we can stop right here.
    if(_StopIfWatch(valuePerShare, currency)){
      return;
    }
    _SetEstimatedValue(valuePerShare, currency);
    // print(ev, 'Current Enterprise Value', '#', currency);
    // print(income_ltm['calculatedEbitda'], 'EBITDA', '#', currency);
    print(ev/response.income_ltm['calculatedEbitda'], 'Exit EBITDA Multiple (EV/EBITDA)', '#');
    print(forecasted_data.get('calculatedEbitda').valueAtDate(forecastEndDate), 'Terminal EBITDA', '#', currency);
    print(terminalValue, 'Terminal Enterprise Value', '#', currency);
    print(discountedTerminalValue, 'Discounted Terminal Enterprise Value', '#', currency);
    print(projectedEnterpriseValue-discountedTerminalValue, 'Sum of Discounted Free Cash Flow', '#', currency);
    print(projectedEnterpriseValue, 'Present Enterprise Value', '#', currency);
    print(response.balance_ltm['cashAndShortTermInvestments'], 'Cash and Equivalents', '#', currency);
    print(response.balance_ltm['totalDebt'], 'Total Debt', '#', currency);
    print(equityValue, 'Present Equity Value', '#', currency);
    print(original_data.get('weightedAverageShsOut').valueAtDate('ltm'), 'Shares Outstanding','#');
    print(valuePerShare, 'Estimated Value per Share', '#', currency);
    print(response.treasury.year10/100,'Yield of the U.S. 10 Year Treasury Note', '%');
    print(costOfEquity, 'Cost of Equity', '%');
    print(equityWeight, 'Equity Weight', '%');
    print(costOfDebt, 'Cost of Debt', '%');
    print(debtWeight, 'Debt Weight', '%');
    print(taxRate, 'EBIT Tax Rate', '%');
    // +------------- END OF MODEL VALUES SECTION ------------+
    
    // +------------------- CHARTS SECTION -------------------+    
    // Fill the chart with historical and forecasted data (in M or Millions)
    // The chart has editable forecasted points, so we need to make sure that
    // we overwrite forecasted data with any user edited data
    forecasted_data.renderChart({
      start_date: nextYear - getAssumption('HISTORICAL_YEARS'),
      keys: ['revenue', 'operatingCashFlow', 'calculatedEbitda', 'freeCashFlow', 'capitalExpenditure', 'linearRegressionRevenue', 'discountedFreeCashFlow'],
      properties: {
        title: 'Historical and forecasted data',
        currency: currency,
      	number_format: 'M',
      	disabled_keys: ['linearRegressionRevenue', 'discountedFreeCashFlow'],
      }
    });
    // +---------------- END OF CHARTS SECTION ---------------+ 
    
    // +------------------- TABLES SECTION -------------------+
    forecasted_data.removeDate('LTM').renderTable({
      start_date: currentDate,
      keys: ['revenue', '_revenueGrowthRate', 'calculatedEbitda', '_ebitdaMargin', 'operatingCashFlow', 
             '_operatingCashFlowToEbitda', 'capitalExpenditure', 
             '_capitalExpenditureToEbitda', 'freeCashFlow', 
             '_freeCashFlowToEbitda', 'discountedFreeCashFlow'],
      rows: ['Revenue', '{%} Revenue Growth Rate', 'EBITDA', '{%} EBITDA Margin', 'Operating Cash Flow', 
                '{%} Operating Cash Flow to EBITDA', 'Capital Expendtiture', 
                '{%} Capital Expendtiture to EBITDA', 'Free Cash Flow', 
                '{%} Free Cash Flow to EBITDA', 'Discounted Free Cash Flow'],
      properties: {
        'title': 'Estimated Future Data',
        'currency': currency,
        'column_order': 'ascending',
      	'number_format': 'M',
      }
    });
    
    // Historical Table
    historical_computed_data.renderTable({
      start_date: nextYear - getAssumption('HISTORICAL_YEARS'),
      keys: ['revenue', '_revenueGrowthRate', 'costOfRevenue', 'grossProfit', '_grossMargin',
             'calculatedEbitda', '_ebitdaMargin', 'netIncome', '_netIncomeToEbitda',
             'operatingCashFlow', '_operatingCashFlowToEbitda',
             'capitalExpenditure', '_capitalExpenditureToEbitda', 
             'freeCashFlow', '_freeCashFlowToEbitda'],
      rows: ['Revenue', '{%} Revenue Growth Rate', 'Cost of Revenue', 'Gross Profit', '{%} Gross Margin', 
                'EBITDA', '{%} EBITDA Margin', 'Net Income', '{%} Net Income to EBITDA', 
             	'Cash from Operating Activities', '{%} Cash from Operating Activities to EBITDA', 
             'Capital Expenditure', '{%} Capital Expenditure to EBITDA', 
                'Free Cash Flow', '{%} Free Cash Flow to EBITDA'],
      properties: {
        'title': 'Historical data',
        'currency': currency,
        'number_format': 'M',
        'display_averages': true,
        'column_order': 'descending',
      },
    });
    // +---------------- END OF TABLES SECTION ---------------+ 
  }
  catch (error) {
    throwError(error);
  }
});

Description(`<p>Discounted Free Cash Flow calculates the value of a share based on the company's estimated future Free Cash Flow figures.</p>
			<p class='text-center'>Read more: <a href='https://github.com/DiscountingCashFlows/Documentation/blob/main/models-documentation/discounted-free-cash-flow.md#discounted-free-cash-flow-model-source-code' target='_blank'><i class="fab fa-github"></i> GitHub Documentation</a></p>
			`,
  {
    _DISCOUNT_RATE: [
      '{Equation} \\text{Discount Rate} = \\text{Equity Weight} * \\text{Cost of Equity} + \\text{Debt Weight} * \\text{Cost of Debt} * (1 - \\text{Tax Rate})',
      '{Paragraph} Calculated using Weighted Average Cost of Capital (WACC) formula. It represents a firm’s average after-tax cost of capital from all sources, including common stock, preferred stock, bonds, and other forms of debt.',
      '{Link} https://www.investopedia.com/terms/w/wacc.asp',
      
      '{Title} Cost of Equity',
      '{Equation} \\text{Cost of Equity} = \\text{Risk Free Rate} + \\text{Beta} * \\text{Market Premium}',
      '{Paragraph} The cost of equity is the theoretical rate of return that an equity investment should generate. It is calculated using the CAPM formula.',
      '{Link} https://www.investopedia.com/terms/c/costofequity.asp#mntl-sc-block_1-0-20',
      
      '{Title} Cost of Debt',
      '{Equation} \\text{Cost of Debt} = \\frac{\\text{Interest Expense}}{\\text{Total Debt}}',
      '{Paragraph} The cost of debt is the effective rate that a company pays on its debt, such as bonds and loans.',
      '{Link} https://www.investopedia.com/terms/c/costofdebt.asp',
      
      '{Title} Equity & Debt Weights',
      '{Equation} \\text{Debt Weight} = \\frac{\\text{Total Debt}}{\\text{Market Capitalization} + \\text{Total Debt}} = 1 - \\text{Equity Weight}',
      '{Paragraph} The Equity Weight represents the proportion of equity-based financing (Market Capitalization), while the Debt Weight represents the proportion of debt-based financing (Total Debt).',
      
      '{Title} Tax Rate',
      '{Equation} \\text{Tax Rate} = \\frac{\\text{Income Tax Expense}}{\\text{Income Before Tax}}',
      '{Paragraph} The overall tax rate paid by the company on its earned income.',
    ],
    _GROWTH_IN_PERPETUITY: 'The rate at which the company\'s free cash flow is assumed to grow in perpetuity. By default, this is equal to the yield of the U.S. 10 Year Treasury Bond.',
    HISTORICAL_YEARS: 'The number of historical years used to calculate averages for historical data.',
    PROJECTION_YEARS: 'The number of years for projecting the analysis into the future.',
    _REVENUE_GROWTH_RATE: `The annual revenue growth rate is applied to projected revenue starting from the second projection year onward.`,
    EXIT_EBITDA_MULTIPLE: `The exit EV/EBITDA multiple used to calculate the terminal value.`,
    _EBITDA_MARGIN: `EBITDA expressed as a percentage of Revenue.`,
    _CAPITAL_EXPENDITURE_TO_EBITDA: `Capital expenditure expressed as a percentage of EBITDA.`,
    _OPERATING_CASH_FLOW_TO_EBITDA: `Operating cash flow expressed as a percentage of EBITDA.`,
    _RISK_FREE_RATE: 'The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.'+
    ' By default, it is equal to the current yield of the U.S. 10 Year Treasury Bond.',
    _MARKET_PREMIUM: 'Market risk premium represents the excess returns over the risk-free rate that investors expect for taking on the incremental risks connected to the equities market.',
    BETA: 'Beta is a value that measures the price fluctuations (volatility) of a stock with respect to fluctuations in the overall stock market.',
  });