David Jones Limited (DJS)

Discount cash flow analysis

Sell Overvalued by 47.9%

5% margin of safety What's this?

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How does this work?

This is an interactive analyst report for David Jones Limited, based on a discounted cash flow valuation approach.

You can modify the assumptions and the valuation will be updated automatically. You can also save and share your valuation.

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Values in $ millions
2008 2009 2010 2011 2012 2013 2014 2015
 
                 
               
 

What will the revenues be in the future?

Growth beyond year three is driven by the terminal growth rate.

Sensitivity matrix

   
-1%
Discount Rate %
0%

1%
  -1% $2.11 $2.08 $2.04
Terminal Growth% 0 $2.12 $2.08 $2.05
  +1% $2.13 $2.09 $2.05

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 $0.83 (overvalued by 79.2%) - 1 year ago
  • treadstonespook created a new valuation of $2.72 (overvalued by 41.0%) - over 7 years ago
  • nilesfrancis created a new valuation of $2.69 (overvalued by 53.46%) - almost 8 years ago
  • kein created a new valuation of $5.42 (overvalued by 2.52%) - almost 8 years ago
  • kein created a new valuation of $2.79 (overvalued by 49.82%) - almost 8 years ago
  • kein created a new valuation of $5.10 (overvalued by 8.27%) - almost 8 years ago
  • ycakrawinata created a new valuation of $5.10 (overvalued by 12.67%) - almost 8 years ago
  • ycakrawinata created a new valuation of $4.62 (overvalued by 20.89%) - almost 8 years ago
  • dotsachdev created a new valuation of $2.82 (overvalued by 6.62%) - over 8 years ago
  • gordonsk created a new valuation of $2.81 (undervalued by 1.08%) - over 8 years ago
  • KiwiEMH created a new valuation of $2.08 (overvalued by 7.96%) - over 8 years ago

Comments

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The boring details

All amounts in millions Figures
Enterprise Value: 2,374
Net Debt (Long-term borrowings less cash): 445
Equity Value: 1,092
Number of Shares Outstanding: 483,000,000
Calculated value per share: $2.08

Enterprise Value is the present value of the post-tax cash flows for a business into the future.


Calcuation of EV

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.


Perpetuity

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.


CAPM model

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.