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DCF assessment -
Small-Cap DCF
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Written by Peter van der Lely
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Wednesday, 29 July 2009 11:17 |
 The 28th of july 09, DOCdata presented a solid set of results. Autonomous growth and the margin development is strong. This underscores the potential of this company even in adverse economic circumstances. DOCdata is profiting from the secular trend of increasing online transactions. Also, the market for (innovative) security documents is growing and rather robust.
Balance sheet and financing: robust and conservative. Therefore we decided to run a valuation. Use your own expectations, if you like. Keep in mind that the liquidity of this stock is limited: even small orders can result in big price movements.
Google chart, company specs click here <>
DOCdata NV is a Netherlands-based company which offers transaction-related Internet services for both business-to-business (B-to-B) and business-to-consumer (B-to-C) clients. The Company’s range of services includes traceability and multiple payment and communication options. The Company is organized into four divisions: Commerce, Payments, Fulfilment and Media. Through Industrial Automation Integrators (IAI) BV, DOCdata NV is engaged in the securing and personalizing of security documents, as well as the processing of solar cells and packaging materials. As of December 31, 2007, DOCdata NV had a number of wholly owned subsidiaries, including Industrial Automation Integrators (IAI) BV, DOCdata International BV, DOCdata Germany GmbH, Optical Disc de France SAS and Ablex Limited. The Company is active in various countries, including the Netherlands, Germany, France and the United Kingdom.
disclaimer about Equitycatwalk the author has no position in this stock at the moment of publishing |
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Wessanen, sharing the same thoughts again |
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DCF assessment -
Small-Cap DCF
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Written by Peter van der Lely
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Monday, 20 July 2009 09:25 |
We already publiced this article the 22th of April, so there is nothing new but the recent break of the stockprice through EUR 3 deserves a highlight.
We haven't updated the WACC for a slightly higer riskless rate (about 3.50%) and a much lower risk premium (about 6.5%): a net positive vs the 22th of April.
Dutch food group Wessanen NV said on the 22th of april that it would start a review of whether to exit all of its North American businesses and focus on Europe as it aims to streamline its business and shore up finances.
We've updated our Wessanen model (the 22th of April) with the possible impact of the news (as if executed in 2009): margins, in that case, will rise because of the below average operating performance of Tree of Life. The importance of this can be read in our former Wessanen post. 2009 (estimated) Revenues and Operating results will decrease (pro-forma) with the 2008 Tree of Life Revenue and Operating results as can be found in it's annual report on the segment information: p57. Download here. So, our former revenue estimate (see here) for 2009 decreases 944,6 to 702,9 and the operating result with minus 25 to 34,1 (by adjusting the post others).
We are estimating divestment revenues of around 0.25 times sales and 10 times the operating result: around EUR 250 mln. You can check out the consequences in the sheet.
Ofcourse check the assumptions yourself and use your own estimates.
Regarding the bookkeeping of the divestment we estimate:
Cash proceeds (used for lowering the long-term debt: from 227.1 to -22.9) + EUR 250 mln
Exceptional loss (difference of the bookvalue of the assets and the cash proceeds) - EUR 156.6 mln
Assets - EUR 406,6 (annual report on the segment information: p57. Download here)
We haven't adjusted the WACC sheet (just to stay conservative), in respons to the change of a more conservative balance sheet. A better credit metrix (you can check the differences with our first Wessanen sheet) and lower debt should also improve the WACC.
Please use your own estimates and convictions (we can publice your model if you like). We share ours.
disclaimer about Equitycatwalk
the author has a position in this stock at the moment of publishing this article |
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DCF assessment -
Small-Cap DCF
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Written by Peter van der Lely
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Monday, 06 July 2009 16:01 |
Wavin NV, on monday 6 July 2009, publiced the terms of it's rights offering which can be found on the IR page of it's website.
We adjusted the Wavin NV model accordingly and commented in the sheet (wacc as well as dcf). Input changes are highlighted with green colored cells and commented on: wacc: - debt position
- debt yield
- nr shares
- shareprice adjusted for rights issue
dcf: - debt
- equity
- close price adjusted for rights issue
disclaimer about Equitycatwalk
the author has no position in this stock at the moment of publishing |
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Other analyses -
Other analyses
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Written by Peter van der Lely
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Wednesday, 08 July 2009 12:27 |
As of the beginning of this afternoon the 8th of July, the arbitrage-gap between the rights and shares of Wavin NV is getting smaller vs. this morning (reference until 12:40).
This may be the sign that speculative trading is diminishing with regard to the Rights offering of Wavin NV. In the sheet we present:
• theoretical/hypothetical share and rights price
• the actual development and quotes of today (source: euronext) until 12:40
• we compared the theoretical share price in relation with the Rights offering with the actual share price
• we only compared Share and Rights price data from same time order-execution data points
• a histogram of the arbitrage premium or discount of the trades
Conclusions:
• in all trades there is a discount of the Rights vs the Shares
• this morning, most of the trades were executed at the biggest arbitrage gap (up to 8%)
• from 11:31 am on, the arbitrage gap declined (at first to 2.65%)
• 12:39 pm: 3.47% arbitrage gap
This may be the (first) sign that speculative trading is diminishing with regard to the Rights offering of Wavin NV.
disclaimer the author has a position in this stock at the moment of publishing |
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DCF assessment -
Small-Cap DCF
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Written by Peter van der Lely
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Monday, 06 July 2009 13:17 |
Wavin today (6th of July) published the terms of its rights offering which can be found on the IR page. Before taking a look at the rights issue, we show you a dcf model pre-rights issue (excel button). From 2012 on we estimate a normalization of the revenue CAGR of 5%, or 2.6% less than the autonomous growth of 2007.
We also see margins returning to its 2008 level. The current Q1 trading update shows a revenue decline of 34.6% which is even worse than our full year projection of -22%. Wavin seems to be more aggressive regarding a rights issue than for example Oce which for example hasn't announced one (is it aiming for another solution?).
This might be a smart choice regarding the relative favorable market circumstances at the moment. On the other side it might implicate the company
doesn't foresee a quick improvement in the dramatic fall in revenues.
We might come back to you with a Wavin post rights issue model. disclaimer
the author has no position in this stock at the moment of publishing |
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