The Williams Companies, Inc. (WMB) DCF Valuation
TGM's two-stage DCF values The Williams Companies, Inc. (WMB) between $13.62 and $49.34 depending on assumptions, with a base case of $27.37. Growth is taken from the company's own record (5-year revenue CAGR (FCF growth too volatile to use)), fading to 2.5% long-run; the discount rate (7.5%) reflects its beta.
What would today's price require?
$71.49 is justified only if free cash flow grows about +22.4% a year (fading to 2.5% long-run) at a 7.5% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 4.2%/yr | 8.5% | $13.62 |
| Base case | 7.2%/yr | 7.5% | $27.37 |
| Optimistic | 10.2%/yr | 6.5% | $49.34 |
| Analyst DCF (FMP) | independent reference — different model | $65.99 | |
Current Price
$71.49
Market-Implied Growth
+22.4%/yr
vs +7.2% 5Y actual
Model Scenario Range
$13.62 – $49.34
model output — not a price target
WMB DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for WMB (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $2.5B · 1.22B shares · net debt $29.3B
Estimated Fair Value
$37.01
-48.2% vs $71.49
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 7.2%/yr FCF growth and 10-year horizon fixed. Green = above today's $71.49; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.5% | $59.37 | $68.42 | $80.48 | $97.38 | $123 |
| 6.5% | $41.64 | $46.81 | $53.28 | $61.59 | $72.67 |
| 7.5% | $29.88 | $33.12 | $37.01 | $41.77 | $47.71 |
| 8.5% | $21.52 | $23.69 | $26.21 | $29.19 | $32.77 |
| 9.5% | $15.30 | $16.81 | $18.53 | $20.53 | $22.85 |
About The Williams Companies, Inc.
The Williams Companies, Inc., alongside its subsidiaries, operates as a prominent energy infrastructure entity, primarily conducting business throughout the United States. The company’s operations are organized into four key segments: Transmission & Gulf of Mexico, Northeast G&P, West, and Gas & NGL Marketing Services. The Transmission & Gulf of Mexico division manages crucial natural gas pipelines such as Transco and Northwest, in addition to natural gas gathering and processing, and crude oil production handling and transportation assets situated in the Gulf Coast. This segment also oversees various petrochemical and feedstock pipelines. Focusing on midstream activities, the Northeast G&P segment handles gathering, processing, and fractionation within the Marcellus Shale region, predominantly in Pennsylvania and New York, and the Utica Shale region of eastern Ohio. The West segment delivers gas gathering, processing, and treating services across the Rocky Mountain areas of Colorado and Wyoming, the Barnett Shale in north-central Texas, the Eagle Ford Shale in South Texas, the Haynesville Shale in northwest Louisiana, and the expansive Mid-Continent region (including the Anadarko, Arkoma, and Permian basins). This segment also operates natural gas liquid (NGL) fractionation and storage facilities located near Conway in central Kansas. The Gas & NGL Marketing Services segment provides comprehensive wholesale marketing, trading, storage, and transportation of natural gas to utilities, municipalities, power generators, and producers, while also offering risk and asset management and NGL marketing services. The company possesses and operates an extensive network, including 30,000 miles of pipelines, 29 processing facilities, 7 fractionation facilities, and an approximate NGL storage capacity of 23 million barrels. The Williams Companies, Inc. was established in 1908 and maintains its headquarters in Tulsa, Oklahoma.
- Sector
- Energy
- Industry
- Oil & Gas Midstream
- CEO
- Chad J. Zamarin