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Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $1.20 | $1.18 | $1.16 | |
| Terminal Growth% | 0 | $1.21 | $1.19 | $1.17 |
| +1% | $1.21 | $1.19 | $1.18 |
How does a change in discount rate or terminal growth affect valuation?
This table shows the sensitivity of the valuation to two key variables - the discount rate and the terminal growth rate
Valuations and comments
- Valuecruncher created a new valuation of $1.19 (undervalued by 466.67%) - over 1 year ago
- blackgrape created a new valuation of $1.65 (undervalued by 79.35%) - almost 8 years ago
- Scarydog created a new valuation of $1.71 (undervalued by 48.7%) - over 8 years ago
- GordonGekko created a new valuation of $1.86 (undervalued by 20.0%) - almost 9 years ago
- Traderchan created a new valuation of $1.36 (overvalued by 17.07%) - almost 9 years ago
- Traderchan created a new valuation of $2.68 (undervalued by 78.67%) - almost 9 years ago
- GordonGekko created a new valuation of $1.17 (overvalued by 12.69%) - 9 years ago
- GordonGekko created a new valuation of $1.10 (undervalued by 13.4%) - 9 years ago
- nzvikram created a new valuation of $1.10 (undervalued by 50.68%) - 9 years ago
- isambard created a new valuation of $1.59 (undervalued by 54.37%) - over 9 years ago
- Sam created a new valuation of $0.92 (overvalued by 9.8%) - over 9 years ago
- isambard created a new valuation of $1.07 (undervalued by 2.88%) - over 9 years ago
- jamess created a new valuation of $3.61 (undervalued by 247.12%) - over 9 years ago
- KiwiEMH created a new valuation of $1.31 (undervalued by 4.8%) - over 9 years ago
- NZXCrunchBlog created a new valuation of $1.99 (undervalued by 1.02%) - over 9 years ago
- KiwiEMH created a new valuation of $2.94 (overvalued by 3.29%) - over 9 years ago
- GordonGekko created a new valuation of $2.93 (overvalued by 2.98%) - over 9 years ago
- jeremy created a new valuation of $2.91 (undervalued by 10.65%) - almost 10 years ago
- LordTrask created a new valuation of $5.39 (undervalued by 66.87%) - 10 years ago
- andrew created a new valuation of $5.38 (undervalued by 66.56%) - 10 years ago
- Sam created a new valuation of $2.71 (overvalued by 17.88%) - 10 years ago
- KiwiEMH created a new valuation of $2.99 (overvalued by 9.39%) - 10 years ago
- Julian created a new valuation of $6.02 (undervalued by 83.54%) - 10 years ago
- tiger created a new valuation of $1.02 (overvalued by 68.9%) - 10 years ago
- KiwiEMH created a new valuation of $3.27 (undervalued by 5.48%) - 10 years ago
- KiwiEMH created a new valuation of $2.83 (undervalued by 1.07%) - 10 years ago
- KiwiEMH created a new valuation of $3.02 (undervalued by 7.86%) - 10 years ago
- jeremy created a new valuation of $3.03 (undervalued by 8.21%) - 10 years ago
- jeremy created a new valuation of $2.65 (undervalued by 0.76%) - 10 years ago
- GordonGekko created a new valuation of $3.22 (undervalued by 1.26%) - 10 years ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 52 |
| Net Debt (Long-term borrowings less cash): | 12 |
| Equity Value: | 40 |
| Number of Shares Outstanding: | 191,000,000 |
| Calculated value per share: | $1.19 |
Enterprise Value is the present value of the post-tax cash flows for a business into the future.
Where:
- C1, C2, C3 - the cash flow in period 1, 2, 3, ...
- r - the discount rate
To capture the cash flows into the future a terminal value is calculated via a perpetuity calculation -
based on the final years forecast post-tax free cash flow.
Where:
- Cn - the cash flow in the final forecast period.
- LTG - the long-term growth rate
- r - the discount rate
- g - the terminal growth rate
The Capital Asset Pricing Model (CAPM) is used to determine the equity component in the discount rate.
Where:
- rt - the risk free rate
- t - the tax rate
- B - the beta of the company
- MRP - the Market Risk Premium
Valuecruncher uses an estimate of Weighted Average Cost of Capital (WACC) to determine the discount rate in the calculation.