Atlassian’s team stock price experienced mild consolidation this week, trading between $193.50 and $197. However, QCi did issue and sell more shares last month through a $500 million private placement. A private placement is different than a stock split, since it increases the number of shares in circulation. In this case, QCI sold 26.9 million shares to large shareholders and an institutional investor. We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Atlassian as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 8.1%, which is based on a levered beta of 1.182. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. TEAM’s stock price currently hovers around $195.76, supported by a robust SaaS industry outlook. Cloud collaboration demand is forecasted to grow at a CAGR of 12% over the next three years, adding to upward pressure.
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