|
DCF assessment -
Small-Cap DCF
|
|
Written by Peter van der Lely
|
|
Monday, 08 June 2009 12:23 |
 Nutreco is an international animal nutrition and fish feed company that seeks to create added value in major markets through its knowledge of the food production chains, in which it has a selective downstream presence. At the moment of writing we see Nutreco as an attractive agri-play.
Our DCF calculations demonstrate an attractive upward potential, although on 2009 estimates the valuation ratios (e.g. pe ev/ebitda) are stretched in a historic perspective. The ratios look more friendly from 2010 onward. This is because the anticipated 2009 deterioration in operating margins (unfavorable hedging outcomes among others) and lower revenues (volumes). Due to the dependence on volatile external market prices the results of Nutreco are hard to predict and extraordinary items have become more or less ordinary.
The long term revenue growth input is conservative (vs history), we anticipate a short term margin improvement from 2010 onward and a gradual improvement in the long run.
See also the simulation and sensitivity output. Please check your own assumptions and convictions within the model. For sharing them, please comment and/or use the community tab.
disclaimer the author has no position in this stock at the moment of publishing |
|
|
DCF assessment -
Small-Cap DCF
|
|
Written by Peter van der Lely
|
|
Monday, 18 May 2009 09:46 |
Balance sheet: weakened as a result of the (market peak) take-over of TeleAtlas and worsening market circumstances.
Breaching the banking covenants is not unthinkable under certain scenario's, says TomTom.
In the WACC we are using a debt yield of 11% which compares to high yield.
Concerning the debt metrics we point to the possibility of further goodwill amortization and the negative effect this will have on the net debt to capital ratio.
A financially strong partner which also could offer new strategic opportunities might be of interest.
Note the (recently updated) market risk premium of 6.5%.
Please check your own assumptions and convictions within the model. For sharing them, please comment and/or use the community tab. disclaimer the author has no position in this stock at the moment of publishing |
|
DCF assessment -
Large-Cap DCF
|
|
Written by Peter van der Lely
|
|
Monday, 04 May 2009 21:26 |
22 th of April. Heineken reported the trading update over the first quarter. Organic revenue declined 1%. Organic revenue growth 2008: 7.4%. - a return to a 7% annual revenue growth rate by 2013 (is also the perpetual growth rate)
- a step up in margins as of 2009 because of a decrease in impairments (exceptionals)
- (decreasing) market risk premium important regarding further upward potential
Please check your own assumptions and convictions within the model. For sharing them, please comment and/or use the community tab. disclaimer the author has no position in this stock at the moment of publishing |
|
|
DCF assessment -
Large-Cap DCF
|
|
Written by Peter van der Lely
|
|
Tuesday, 12 May 2009 11:26 |
We've run a dcf valuation for Diageo, using the current market risk premium of about 6.5%. Risk free interest rate now at 3.10%.
As could be expected of a consumer staples company like this, the stockprice is more or less in line with current valuation.
The long term revenue growth rate of 4% is 1%-point above the organic net sales growth of the last half year.
Interest coverage (gross interest that is) is above 4, net debt to assets improving.
Nothing spectacular: use the model to your own insight.
disclaimer
|
|
DCF assessment -
Small-Cap DCF
|
|
Written by Peter van der Lely
|
|
Wednesday, 22 April 2009 15:53 |
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 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 of 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.
disclaimer
the author has a position in this stock at the moment of publishing this article |
|
|
|
|
|
|
Page 5 of 7 |
Subscribe