Intrinsic value of Bonavista Energy Corporation - BNP

Previous Close

$2.91

  Intrinsic Value

$1.48

stock screener

  Rating & Target

sell

-49%

  Value-price divergence*

-200%

Previous close

$2.91

 
Intrinsic value

$1.48

 
Up/down potential

-49%

 
Rating

sell

 
Value-price divergence*

-200%

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of BNP stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.8

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -25.09
  35.40
  32.36
  29.62
  27.16
  24.95
  22.95
  21.16
  19.54
  18.09
  16.78
  15.60
  14.54
  13.59
  12.73
  11.95
  11.26
  10.63
  10.07
  9.56
  9.11
  8.70
  8.33
  7.99
  7.69
  7.42
  7.18
  6.96
  6.77
  6.59
  6.43
Revenue, $m
  409
  554
  733
  950
  1,208
  1,510
  1,856
  2,249
  2,688
  3,174
  3,707
  4,285
  4,908
  5,575
  6,285
  7,036
  7,828
  8,660
  9,533
  10,444
  11,395
  12,386
  13,417
  14,490
  15,605
  16,764
  17,968
  19,219
  20,520
  21,872
  23,279
Variable operating expenses, $m
 
  1,354
  1,792
  2,323
  2,954
  3,691
  4,538
  5,498
  6,572
  7,761
  9,063
  10,477
  12,001
  13,631
  15,366
  17,203
  19,140
  21,175
  23,307
  25,536
  27,861
  30,284
  32,806
  35,428
  38,154
  40,987
  43,931
  46,990
  50,170
  53,477
  56,917
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  499
  1,354
  1,792
  2,323
  2,954
  3,691
  4,538
  5,498
  6,572
  7,761
  9,063
  10,477
  12,001
  13,631
  15,366
  17,203
  19,140
  21,175
  23,307
  25,536
  27,861
  30,284
  32,806
  35,428
  38,154
  40,987
  43,931
  46,990
  50,170
  53,477
  56,917
Operating income, $m
  -91
  -800
  -1,059
  -1,373
  -1,746
  -2,181
  -2,682
  -3,249
  -3,884
  -4,587
  -5,356
  -6,192
  -7,092
  -8,056
  -9,081
  -10,167
  -11,312
  -12,514
  -13,774
  -15,092
  -16,466
  -17,898
  -19,388
  -20,938
  -22,549
  -24,223
  -25,963
  -27,771
  -29,651
  -31,605
  -33,638
EBITDA, $m
  229
  -365
  -484
  -627
  -797
  -996
  -1,225
  -1,484
  -1,774
  -2,095
  -2,447
  -2,828
  -3,239
  -3,680
  -4,148
  -4,644
  -5,167
  -5,716
  -6,291
  -6,893
  -7,521
  -8,175
  -8,855
  -9,563
  -10,299
  -11,064
  -11,859
  -12,684
  -13,543
  -14,435
  -15,364
Interest expense (income), $m
  46
  35
  58
  86
  120
  160
  207
  261
  322
  391
  467
  550
  640
  737
  841
  952
  1,069
  1,193
  1,322
  1,458
  1,601
  1,749
  1,904
  2,064
  2,232
  2,406
  2,586
  2,774
  2,969
  3,172
  3,383
Earnings before tax, $m
  -135
  -836
  -1,117
  -1,459
  -1,865
  -2,341
  -2,889
  -3,510
  -4,207
  -4,978
  -5,823
  -6,742
  -7,732
  -8,793
  -9,922
  -11,119
  -12,380
  -13,707
  -15,097
  -16,550
  -18,067
  -19,647
  -21,292
  -23,002
  -24,781
  -26,629
  -28,550
  -30,546
  -32,620
  -34,777
  -37,021
Tax expense, $m
  -39
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -96
  -836
  -1,117
  -1,459
  -1,865
  -2,341
  -2,889
  -3,510
  -4,207
  -4,978
  -5,823
  -6,742
  -7,732
  -8,793
  -9,922
  -11,119
  -12,380
  -13,707
  -15,097
  -16,550
  -18,067
  -19,647
  -21,292
  -23,002
  -24,781
  -26,629
  -28,550
  -30,546
  -32,620
  -34,777
  -37,021

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  86
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  3,172
  4,164
  5,511
  7,144
  9,084
  11,350
  13,955
  16,908
  20,212
  23,867
  27,871
  32,219
  36,904
  41,918
  47,252
  52,901
  58,857
  65,116
  71,673
  78,527
  85,678
  93,129
  100,883
  108,947
  117,330
  126,042
  135,094
  144,503
  154,282
  164,451
  175,028
Adjusted assets (=assets-cash), $m
  3,086
  4,164
  5,511
  7,144
  9,084
  11,350
  13,955
  16,908
  20,212
  23,867
  27,871
  32,219
  36,904
  41,918
  47,252
  52,901
  58,857
  65,116
  71,673
  78,527
  85,678
  93,129
  100,883
  108,947
  117,330
  126,042
  135,094
  144,503
  154,282
  164,451
  175,028
Revenue / Adjusted assets
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
  0.133
Average production assets, $m
  2,954
  3,999
  5,294
  6,862
  8,726
  10,902
  13,404
  16,240
  19,414
  22,925
  26,771
  30,947
  35,447
  40,263
  45,387
  50,813
  56,534
  62,546
  68,844
  75,427
  82,296
  89,452
  96,901
  104,647
  112,698
  121,066
  129,762
  138,798
  148,192
  157,959
  168,119
Working capital, $m
  -172
  -141
  -186
  -241
  -307
  -383
  -471
  -571
  -683
  -806
  -942
  -1,088
  -1,247
  -1,416
  -1,596
  -1,787
  -1,988
  -2,200
  -2,421
  -2,653
  -2,894
  -3,146
  -3,408
  -3,680
  -3,964
  -4,258
  -4,564
  -4,882
  -5,212
  -5,555
  -5,913
Total debt, $m
  930
  1,375
  2,041
  2,847
  3,806
  4,925
  6,212
  7,670
  9,302
  11,108
  13,086
  15,234
  17,548
  20,025
  22,661
  25,451
  28,394
  31,485
  34,724
  38,110
  41,643
  45,324
  49,154
  53,138
  57,279
  61,583
  66,055
  70,702
  75,533
  80,557
  85,782
Total liabilities, $m
  1,612
  2,057
  2,723
  3,529
  4,488
  5,607
  6,894
  8,352
  9,984
  11,790
  13,768
  15,916
  18,230
  20,707
  23,343
  26,133
  29,076
  32,167
  35,406
  38,792
  42,325
  46,006
  49,836
  53,820
  57,961
  62,265
  66,737
  71,384
  76,215
  81,239
  86,464
Total equity, $m
  1,560
  2,107
  2,789
  3,615
  4,597
  5,743
  7,061
  8,555
  10,227
  12,077
  14,103
  16,303
  18,673
  21,210
  23,910
  26,768
  29,782
  32,949
  36,267
  39,735
  43,353
  47,123
  51,047
  55,127
  59,369
  63,777
  68,358
  73,118
  78,067
  83,212
  88,564
Total liabilities and equity, $m
  3,172
  4,164
  5,512
  7,144
  9,085
  11,350
  13,955
  16,907
  20,211
  23,867
  27,871
  32,219
  36,903
  41,917
  47,253
  52,901
  58,858
  65,116
  71,673
  78,527
  85,678
  93,129
  100,883
  108,947
  117,330
  126,042
  135,095
  144,502
  154,282
  164,451
  175,028
Debt-to-equity ratio
  0.596
  0.650
  0.730
  0.790
  0.830
  0.860
  0.880
  0.900
  0.910
  0.920
  0.930
  0.930
  0.940
  0.940
  0.950
  0.950
  0.950
  0.960
  0.960
  0.960
  0.960
  0.960
  0.960
  0.960
  0.960
  0.970
  0.970
  0.970
  0.970
  0.970
  0.970
Adjusted equity ratio
  0.478
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506
  0.506

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -96
  -836
  -1,117
  -1,459
  -1,865
  -2,341
  -2,889
  -3,510
  -4,207
  -4,978
  -5,823
  -6,742
  -7,732
  -8,793
  -9,922
  -11,119
  -12,380
  -13,707
  -15,097
  -16,550
  -18,067
  -19,647
  -21,292
  -23,002
  -24,781
  -26,629
  -28,550
  -30,546
  -32,620
  -34,777
  -37,021
Depreciation, amort., depletion, $m
  320
  435
  575
  746
  948
  1,185
  1,457
  1,765
  2,110
  2,492
  2,910
  3,364
  3,853
  4,376
  4,933
  5,523
  6,145
  6,798
  7,483
  8,199
  8,945
  9,723
  10,533
  11,375
  12,250
  13,159
  14,105
  15,087
  16,108
  17,169
  18,274
Funds from operations, $m
  227
  -401
  -542
  -713
  -917
  -1,156
  -1,432
  -1,745
  -2,096
  -2,486
  -2,913
  -3,378
  -3,879
  -4,417
  -4,989
  -5,595
  -6,235
  -6,908
  -7,614
  -8,352
  -9,121
  -9,924
  -10,759
  -11,628
  -12,531
  -13,470
  -14,445
  -15,459
  -16,512
  -17,608
  -18,747
Change in working capital, $m
  -34
  -37
  -46
  -55
  -66
  -77
  -88
  -100
  -112
  -123
  -135
  -147
  -158
  -169
  -180
  -191
  -201
  -211
  -222
  -232
  -242
  -252
  -262
  -272
  -283
  -294
  -306
  -318
  -330
  -344
  -357
Cash from operations, $m
  261
  -364
  -496
  -658
  -851
  -1,080
  -1,344
  -1,645
  -1,985
  -2,362
  -2,778
  -3,231
  -3,721
  -4,247
  -4,809
  -5,405
  -6,034
  -6,697
  -7,392
  -8,120
  -8,880
  -9,672
  -10,497
  -11,355
  -12,248
  -13,175
  -14,139
  -15,141
  -16,182
  -17,264
  -18,390
Maintenance CAPEX, $m
  0
  -321
  -435
  -575
  -746
  -948
  -1,185
  -1,457
  -1,765
  -2,110
  -2,492
  -2,910
  -3,364
  -3,853
  -4,376
  -4,933
  -5,523
  -6,145
  -6,798
  -7,483
  -8,199
  -8,945
  -9,723
  -10,533
  -11,375
  -12,250
  -13,159
  -14,105
  -15,087
  -16,108
  -17,169
New CAPEX, $m
  -167
  -1,045
  -1,294
  -1,568
  -1,864
  -2,177
  -2,502
  -2,836
  -3,173
  -3,511
  -3,846
  -4,176
  -4,500
  -4,816
  -5,124
  -5,426
  -5,721
  -6,011
  -6,298
  -6,583
  -6,869
  -7,156
  -7,448
  -7,746
  -8,052
  -8,368
  -8,695
  -9,037
  -9,394
  -9,767
  -10,160
Cash from investing activities, $m
  33
  -1,366
  -1,729
  -2,143
  -2,610
  -3,125
  -3,687
  -4,293
  -4,938
  -5,621
  -6,338
  -7,086
  -7,864
  -8,669
  -9,500
  -10,359
  -11,244
  -12,156
  -13,096
  -14,066
  -15,068
  -16,101
  -17,171
  -18,279
  -19,427
  -20,618
  -21,854
  -23,142
  -24,481
  -25,875
  -27,329
Free cash flow, $m
  294
  -1,731
  -2,225
  -2,801
  -3,461
  -4,205
  -5,031
  -5,938
  -6,923
  -7,984
  -9,116
  -10,317
  -11,585
  -12,916
  -14,309
  -15,764
  -17,278
  -18,853
  -20,489
  -22,186
  -23,947
  -25,774
  -27,668
  -29,634
  -31,674
  -33,793
  -35,994
  -38,282
  -40,662
  -43,139
  -45,719
Issuance/(repayment) of debt, $m
  -258
  531
  666
  807
  959
  1,119
  1,287
  1,458
  1,632
  1,806
  1,978
  2,148
  2,314
  2,477
  2,635
  2,791
  2,942
  3,092
  3,239
  3,386
  3,533
  3,681
  3,831
  3,984
  4,141
  4,304
  4,472
  4,648
  4,831
  5,023
  5,225
Issuance/(repurchase) of shares, $m
  110
  1,383
  1,799
  2,285
  2,847
  3,488
  4,207
  5,004
  5,878
  6,827
  7,849
  8,942
  10,103
  11,330
  12,622
  13,977
  15,394
  16,874
  18,415
  20,018
  21,685
  23,417
  25,215
  27,083
  29,023
  31,037
  33,130
  35,306
  37,569
  39,923
  42,373
Cash from financing (excl. dividends), $m  
  -193
  1,914
  2,465
  3,092
  3,806
  4,607
  5,494
  6,462
  7,510
  8,633
  9,827
  11,090
  12,417
  13,807
  15,257
  16,768
  18,336
  19,966
  21,654
  23,404
  25,218
  27,098
  29,046
  31,067
  33,164
  35,341
  37,602
  39,954
  42,400
  44,946
  47,598
Total cash flow (excl. dividends), $m
  100
  183
  239
  290
  345
  403
  463
  525
  587
  649
  711
  772
  832
  891
  948
  1,004
  1,058
  1,112
  1,165
  1,218
  1,270
  1,324
  1,378
  1,433
  1,489
  1,548
  1,608
  1,671
  1,737
  1,807
  1,879
Retained Cash Flow (-), $m
  -12
  -1,383
  -1,799
  -2,285
  -2,847
  -3,488
  -4,207
  -5,004
  -5,878
  -6,827
  -7,849
  -8,942
  -10,103
  -11,330
  -12,622
  -13,977
  -15,394
  -16,874
  -18,415
  -20,018
  -21,685
  -23,417
  -25,215
  -27,083
  -29,023
  -31,037
  -33,130
  -35,306
  -37,569
  -39,923
  -42,373
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -1,200
  -1,559
  -1,995
  -2,503
  -3,085
  -3,744
  -4,480
  -5,291
  -6,178
  -7,138
  -8,169
  -9,270
  -10,439
  -11,674
  -12,973
  -14,336
  -15,762
  -17,250
  -18,801
  -20,415
  -22,093
  -23,838
  -25,650
  -27,533
  -29,489
  -31,522
  -33,635
  -35,831
  -38,116
  -40,494
Discount rate, %
 
  5.80
  6.09
  6.39
  6.71
  7.05
  7.40
  7.77
  8.16
  8.57
  9.00
  9.45
  9.92
  10.42
  10.94
  11.48
  12.06
  12.66
  13.29
  13.96
  14.66
  15.39
  16.16
  16.97
  17.81
  18.71
  19.64
  20.62
  21.65
  22.74
  23.87
PV of cash for distribution, $m
 
  -1,134
  -1,385
  -1,656
  -1,930
  -2,195
  -2,439
  -2,653
  -2,825
  -2,948
  -3,016
  -3,026
  -2,980
  -2,879
  -2,730
  -2,540
  -2,319
  -2,077
  -1,824
  -1,570
  -1,324
  -1,093
  -883
  -698
  -538
  -405
  -298
  -213
  -148
  -100
  -66
Current shareholders' claim on cash, %
  100
  44.1
  19.9
  9.2
  4.3
  2.1
  1.0
  0.5
  0.3
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Bonavista Energy Corporation engages in the acquisition, exploration, development, and production of oil and natural gas properties and assets in Western Canada. As of December 31, 2015, its proved reserves were totaled 262.2 mmboe; and proved plus probable reserves were 406.5 mmboe. The company was founded in 1987 and is headquartered in Calgary, Canada.

FINANCIAL RATIOS  of  Bonavista Energy Corporation (BNP)

Valuation Ratios
P/E Ratio -7.7
Price to Sales 1.8
Price to Book 0.5
Price to Tangible Book
Price to Cash Flow 2.8
Price to Free Cash Flow 7.8
Growth Rates
Sales Growth Rate -25.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -56.6%
Cap. Spend. - 3 Yr. Gr. Rate -18.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 49.7%
Total Debt to Equity 59.6%
Interest Coverage -2
Management Effectiveness
Return On Assets -1.9%
Ret/ On Assets - 3 Yr. Avg. -6.5%
Return On Total Capital -3.6%
Ret/ On T. Cap. - 3 Yr. Avg. -9.2%
Return On Equity -6.2%
Return On Equity - 3 Yr. Avg. -14.8%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 65.5%
Gross Margin - 3 Yr. Avg. 68.8%
EBITDA Margin 56.5%
EBITDA Margin - 3 Yr. Avg. 60.6%
Operating Margin -22%
Oper. Margin - 3 Yr. Avg. -50%
Pre-Tax Margin -33%
Pre-Tax Margin - 3 Yr. Avg. -68%
Net Profit Margin -23.5%
Net Profit Margin - 3 Yr. Avg. -53.6%
Effective Tax Rate 28.9%
Eff/ Tax Rate - 3 Yr. Avg. 45.8%
Payout Ratio -14.6%

BNP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BNP stock intrinsic value calculation we used $409 million for the last fiscal year's total revenue generated by Bonavista Energy Corporation. The default revenue input number comes from 2016 income statement of Bonavista Energy Corporation. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our BNP stock valuation model: a) initial revenue growth rate of 35.4% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 5.8%, whose default value for BNP is calculated based on our internal credit rating of Bonavista Energy Corporation, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Bonavista Energy Corporation.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of BNP stock the variable cost ratio is equal to 244.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for BNP stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.2% for Bonavista Energy Corporation.

Corporate tax rate of 27% is the nominal tax rate for Bonavista Energy Corporation. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the BNP stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for BNP are equal to 722.2%.

Life of production assets of 9.2 years is the average useful life of capital assets used in Bonavista Energy Corporation operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for BNP is equal to -25.4%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $1560 million for Bonavista Energy Corporation - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 263.071 million for Bonavista Energy Corporation is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Bonavista Energy Corporation at the current share price and the inputted number of shares is $0.8 billion.

RELATED COMPANIES Price Int.Val. Rating
BIR Birchcliff Ene 6.10 1.70  str.sell
CNQ Canadian Natur 37.25 6.02  str.sell
TOU Tourmaline Oil 26.88 6.49  str.sell
PXT Parex Resource 15.26 3.89  str.sell
Stock chart of BNP Financial statements of BNP
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

FREE DOWNLOAD
Follow us on:   twitter   twitter   twitter   twitter

VALUATION THEORY       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2017. All rigths reserved.