Intrinsic value of Shaw Communications Inc. Class B Non-vot - SJR-B

Previous Close

$28.31

  Intrinsic Value

$16.73

stock screener

  Rating & Target

sell

-41%

Previous close

$28.31

 
Intrinsic value

$16.73

 
Up/down potential

-41%

 
Rating

sell

We calculate the intrinsic value of SJR-B 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 14.1

 

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, %
  8.87
  8.90
  8.51
  8.16
  7.84
  7.56
  7.30
  7.07
  6.87
  6.68
  6.51
  6.36
  6.22
  6.10
  5.99
  5.89
  5.80
  5.72
  5.65
  5.59
  5.53
  5.47
  5.43
  5.38
  5.35
  5.31
  5.28
  5.25
  5.23
  5.20
  5.18
Revenue, $m
  4,884
  5,319
  5,771
  6,242
  6,732
  7,241
  7,769
  8,319
  8,890
  9,484
  10,101
  10,744
  11,412
  12,109
  12,834
  13,590
  14,379
  15,202
  16,061
  16,958
  17,895
  18,875
  19,899
  20,970
  22,091
  23,265
  24,493
  25,779
  27,127
  28,538
  30,018
Variable operating expenses, $m
 
  3,988
  4,316
  4,658
  5,013
  5,381
  5,765
  6,163
  6,577
  7,008
  7,456
  7,790
  8,275
  8,780
  9,306
  9,854
  10,426
  11,022
  11,645
  12,296
  12,975
  13,686
  14,428
  15,205
  16,018
  16,869
  17,759
  18,692
  19,669
  20,693
  21,765
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
  3,788
  3,988
  4,316
  4,658
  5,013
  5,381
  5,765
  6,163
  6,577
  7,008
  7,456
  7,790
  8,275
  8,780
  9,306
  9,854
  10,426
  11,022
  11,645
  12,296
  12,975
  13,686
  14,428
  15,205
  16,018
  16,869
  17,759
  18,692
  19,669
  20,693
  21,765
Operating income, $m
  1,096
  1,331
  1,455
  1,585
  1,719
  1,859
  2,004
  2,156
  2,313
  2,476
  2,646
  2,954
  3,138
  3,329
  3,528
  3,736
  3,953
  4,179
  4,416
  4,662
  4,920
  5,189
  5,471
  5,765
  6,073
  6,396
  6,734
  7,087
  7,458
  7,846
  8,253
EBITDA, $m
  2,058
  2,335
  2,534
  2,740
  2,955
  3,179
  3,411
  3,652
  3,903
  4,163
  4,435
  4,717
  5,010
  5,316
  5,634
  5,966
  6,313
  6,674
  7,051
  7,445
  7,856
  8,286
  8,736
  9,206
  9,698
  10,213
  10,753
  11,317
  11,909
  12,529
  13,178
Interest expense (income), $m
  306
  281
  326
  373
  421
  471
  524
  578
  634
  693
  754
  817
  883
  952
  1,024
  1,098
  1,176
  1,257
  1,341
  1,429
  1,522
  1,618
  1,718
  1,824
  1,934
  2,049
  2,169
  2,295
  2,428
  2,566
  2,711
Earnings before tax, $m
  627
  1,050
  1,129
  1,212
  1,298
  1,388
  1,481
  1,578
  1,678
  1,783
  1,892
  2,136
  2,254
  2,377
  2,505
  2,638
  2,777
  2,923
  3,074
  3,233
  3,398
  3,571
  3,752
  3,942
  4,140
  4,347
  4,564
  4,792
  5,030
  5,280
  5,542
Tax expense, $m
  171
  283
  305
  327
  350
  375
  400
  426
  453
  481
  511
  577
  609
  642
  676
  712
  750
  789
  830
  873
  918
  964
  1,013
  1,064
  1,118
  1,174
  1,232
  1,294
  1,358
  1,426
  1,496
Net income, $m
  1,220
  766
  824
  885
  948
  1,013
  1,081
  1,152
  1,225
  1,301
  1,381
  1,559
  1,645
  1,735
  1,829
  1,926
  2,027
  2,133
  2,244
  2,360
  2,481
  2,607
  2,739
  2,877
  3,022
  3,173
  3,332
  3,498
  3,672
  3,854
  4,045

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  405
  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
  15,382
  16,315
  17,703
  19,148
  20,650
  22,210
  23,832
  25,518
  27,270
  29,091
  30,985
  32,956
  35,007
  37,143
  39,368
  41,688
  44,107
  46,631
  49,266
  52,018
  54,893
  57,898
  61,040
  64,326
  67,765
  71,364
  75,132
  79,078
  83,211
  87,541
  92,079
Adjusted assets (=assets-cash), $m
  14,977
  16,315
  17,703
  19,148
  20,650
  22,210
  23,832
  25,518
  27,270
  29,091
  30,985
  32,956
  35,007
  37,143
  39,368
  41,688
  44,107
  46,631
  49,266
  52,018
  54,893
  57,898
  61,040
  64,326
  67,765
  71,364
  75,132
  79,078
  83,211
  87,541
  92,079
Revenue / Adjusted assets
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
Average production assets, $m
  7,455
  8,116
  8,807
  9,526
  10,273
  11,049
  11,856
  12,695
  13,566
  14,472
  15,414
  16,395
  17,415
  18,478
  19,585
  20,739
  21,942
  23,198
  24,509
  25,878
  27,308
  28,803
  30,366
  32,001
  33,711
  35,502
  37,376
  39,339
  41,395
  43,550
  45,807
Working capital, $m
  -943
  -1,021
  -1,108
  -1,198
  -1,292
  -1,390
  -1,492
  -1,597
  -1,707
  -1,821
  -1,939
  -2,063
  -2,191
  -2,325
  -2,464
  -2,609
  -2,761
  -2,919
  -3,084
  -3,256
  -3,436
  -3,624
  -3,821
  -4,026
  -4,242
  -4,467
  -4,703
  -4,950
  -5,208
  -5,479
  -5,763
Total debt, $m
  5,612
  6,042
  6,903
  7,799
  8,730
  9,697
  10,703
  11,748
  12,834
  13,964
  15,138
  16,360
  17,631
  18,956
  20,335
  21,774
  23,273
  24,838
  26,472
  28,178
  29,961
  31,824
  33,772
  35,809
  37,941
  40,173
  42,509
  44,955
  47,518
  50,203
  53,016
Total liabilities, $m
  9,685
  10,115
  10,976
  11,872
  12,803
  13,770
  14,776
  15,821
  16,907
  18,037
  19,211
  20,433
  21,704
  23,029
  24,408
  25,847
  27,346
  28,911
  30,545
  32,251
  34,034
  35,897
  37,845
  39,882
  42,014
  44,246
  46,582
  49,028
  51,591
  54,276
  57,089
Total equity, $m
  5,697
  6,200
  6,727
  7,276
  7,847
  8,440
  9,056
  9,697
  10,363
  11,055
  11,774
  12,523
  13,303
  14,114
  14,960
  15,841
  16,761
  17,720
  18,721
  19,767
  20,859
  22,001
  23,195
  24,444
  25,751
  27,118
  28,550
  30,050
  31,620
  33,266
  34,990
Total liabilities and equity, $m
  15,382
  16,315
  17,703
  19,148
  20,650
  22,210
  23,832
  25,518
  27,270
  29,092
  30,985
  32,956
  35,007
  37,143
  39,368
  41,688
  44,107
  46,631
  49,266
  52,018
  54,893
  57,898
  61,040
  64,326
  67,765
  71,364
  75,132
  79,078
  83,211
  87,542
  92,079
Debt-to-equity ratio
  0.985
  0.970
  1.030
  1.070
  1.110
  1.150
  1.180
  1.210
  1.240
  1.260
  1.290
  1.310
  1.330
  1.340
  1.360
  1.370
  1.390
  1.400
  1.410
  1.430
  1.440
  1.450
  1.460
  1.460
  1.470
  1.480
  1.490
  1.500
  1.500
  1.510
  1.520
Adjusted equity ratio
  0.353
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,220
  766
  824
  885
  948
  1,013
  1,081
  1,152
  1,225
  1,301
  1,381
  1,559
  1,645
  1,735
  1,829
  1,926
  2,027
  2,133
  2,244
  2,360
  2,481
  2,607
  2,739
  2,877
  3,022
  3,173
  3,332
  3,498
  3,672
  3,854
  4,045
Depreciation, amort., depletion, $m
  962
  1,004
  1,078
  1,156
  1,236
  1,320
  1,406
  1,497
  1,590
  1,688
  1,789
  1,763
  1,873
  1,987
  2,106
  2,230
  2,359
  2,494
  2,635
  2,783
  2,936
  3,097
  3,265
  3,441
  3,625
  3,817
  4,019
  4,230
  4,451
  4,683
  4,926
Funds from operations, $m
  1,735
  1,770
  1,903
  2,040
  2,184
  2,333
  2,487
  2,648
  2,815
  2,989
  3,170
  3,322
  3,518
  3,722
  3,934
  4,156
  4,387
  4,628
  4,880
  5,142
  5,417
  5,704
  6,004
  6,318
  6,647
  6,991
  7,351
  7,728
  8,123
  8,537
  8,971
Change in working capital, $m
  72
  -83
  -87
  -90
  -94
  -98
  -102
  -106
  -110
  -114
  -119
  -123
  -128
  -134
  -139
  -145
  -151
  -158
  -165
  -172
  -180
  -188
  -197
  -206
  -215
  -225
  -236
  -247
  -259
  -271
  -284
Cash from operations, $m
  1,663
  1,854
  1,989
  2,131
  2,278
  2,430
  2,589
  2,754
  2,925
  3,103
  3,288
  3,446
  3,646
  3,856
  4,074
  4,301
  4,538
  4,786
  5,044
  5,315
  5,597
  5,892
  6,201
  6,524
  6,862
  7,216
  7,587
  7,975
  8,382
  8,808
  9,255
Maintenance CAPEX, $m
  0
  -802
  -873
  -947
  -1,024
  -1,105
  -1,188
  -1,275
  -1,365
  -1,459
  -1,556
  -1,657
  -1,763
  -1,873
  -1,987
  -2,106
  -2,230
  -2,359
  -2,494
  -2,635
  -2,783
  -2,936
  -3,097
  -3,265
  -3,441
  -3,625
  -3,817
  -4,019
  -4,230
  -4,451
  -4,683
New CAPEX, $m
  -1,198
  -662
  -691
  -719
  -747
  -776
  -807
  -839
  -872
  -906
  -942
  -980
  -1,020
  -1,063
  -1,107
  -1,154
  -1,203
  -1,256
  -1,311
  -1,369
  -1,430
  -1,495
  -1,563
  -1,635
  -1,711
  -1,790
  -1,874
  -1,963
  -2,056
  -2,154
  -2,257
Cash from investing activities, $m
  -1,227
  -1,464
  -1,564
  -1,666
  -1,771
  -1,881
  -1,995
  -2,114
  -2,237
  -2,365
  -2,498
  -2,637
  -2,783
  -2,936
  -3,094
  -3,260
  -3,433
  -3,615
  -3,805
  -4,004
  -4,213
  -4,431
  -4,660
  -4,900
  -5,152
  -5,415
  -5,691
  -5,982
  -6,286
  -6,605
  -6,940
Free cash flow, $m
  436
  390
  426
  465
  506
  549
  594
  640
  688
  738
  790
  808
  863
  920
  980
  1,041
  1,105
  1,171
  1,239
  1,310
  1,384
  1,461
  1,541
  1,624
  1,711
  1,801
  1,895
  1,993
  2,096
  2,203
  2,315
Issuance/(repayment) of debt, $m
  -51
  835
  861
  896
  931
  968
  1,006
  1,045
  1,086
  1,129
  1,174
  1,222
  1,272
  1,324
  1,380
  1,438
  1,500
  1,565
  1,634
  1,706
  1,782
  1,863
  1,948
  2,038
  2,132
  2,231
  2,336
  2,446
  2,563
  2,685
  2,813
Issuance/(repurchase) of shares, $m
  38
  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 from financing (excl. dividends), $m  
  -36
  835
  861
  896
  931
  968
  1,006
  1,045
  1,086
  1,129
  1,174
  1,222
  1,272
  1,324
  1,380
  1,438
  1,500
  1,565
  1,634
  1,706
  1,782
  1,863
  1,948
  2,038
  2,132
  2,231
  2,336
  2,446
  2,563
  2,685
  2,813
Total cash flow (excl. dividends), $m
  400
  1,226
  1,287
  1,361
  1,437
  1,517
  1,600
  1,685
  1,775
  1,867
  1,964
  2,030
  2,135
  2,245
  2,359
  2,479
  2,605
  2,736
  2,873
  3,016
  3,167
  3,324
  3,489
  3,662
  3,843
  4,032
  4,231
  4,440
  4,658
  4,888
  5,128
Retained Cash Flow (-), $m
  -885
  -503
  -528
  -549
  -571
  -593
  -616
  -641
  -666
  -692
  -720
  -749
  -779
  -812
  -846
  -881
  -919
  -959
  -1,001
  -1,046
  -1,092
  -1,142
  -1,194
  -1,249
  -1,307
  -1,368
  -1,432
  -1,499
  -1,571
  -1,646
  -1,724
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
 
  723
  759
  812
  867
  924
  983
  1,045
  1,109
  1,175
  1,245
  1,281
  1,355
  1,433
  1,514
  1,598
  1,685
  1,777
  1,872
  1,971
  2,074
  2,182
  2,295
  2,413
  2,536
  2,665
  2,799
  2,940
  3,088
  3,242
  3,404
Discount rate, %
 
  6.90
  7.25
  7.61
  7.99
  8.39
  8.81
  9.25
  9.71
  10.19
  10.70
  11.24
  11.80
  12.39
  13.01
  13.66
  14.34
  15.06
  15.81
  16.61
  17.44
  18.31
  19.22
  20.18
  21.19
  22.25
  23.37
  24.53
  25.76
  27.05
  28.40
PV of cash for distribution, $m
 
  676
  660
  652
  637
  618
  593
  563
  528
  491
  450
  397
  355
  314
  273
  234
  197
  164
  133
  106
  83
  64
  48
  35
  25
  18
  12
  8
  5
  3
  2
Current shareholders' claim on cash, %
  100
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Shaw Communications Inc. (Shaw) is a diversified connectivity provider. The Company operates through four divisions: Consumer, Wireless, Business Network Services and Business Infrastructure Services. Under the Consumer division, the Company offers Cable telecommunications and Satellite video services to residential customers. Its Business Network Services division offers data networking, Cable telecommunications, Satellite video and fleet tracking services to businesses and public sector entities. Its Business Infrastructure Services division offers data center colocation, cloud technology and managed information technology (IT) solutions to businesses. The Company offers wireless services for voice and data communications through its Wireless division. Its wireline services offer approximately 120 high definition (HD) channels and over 10,000 on-demand, pay-per-view and subscription movie and television programming titles.

FINANCIAL RATIOS  of  Shaw Communications Inc. Class B Non-vot (SJR-B)

Valuation Ratios
P/E Ratio 11.3
Price to Sales 2.8
Price to Book 2.4
Price to Tangible Book
Price to Cash Flow 8.3
Price to Free Cash Flow 29.6
Growth Rates
Sales Growth Rate 8.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 12%
Cap. Spend. - 3 Yr. Gr. Rate 3.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 91.3%
Total Debt to Equity 98.5%
Interest Coverage 3
Management Effectiveness
Return On Assets 9.6%
Ret/ On Assets - 3 Yr. Avg. 8.5%
Return On Total Capital 11.2%
Ret/ On T. Cap. - 3 Yr. Avg. 9.7%
Return On Equity 23.2%
Return On Equity - 3 Yr. Avg. 20.2%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 43.3%
Gross Margin - 3 Yr. Avg. 44%
EBITDA Margin 38.8%
EBITDA Margin - 3 Yr. Avg. 42.3%
Operating Margin 22.4%
Oper. Margin - 3 Yr. Avg. 24.9%
Pre-Tax Margin 12.8%
Pre-Tax Margin - 3 Yr. Avg. 18.4%
Net Profit Margin 25%
Net Profit Margin - 3 Yr. Avg. 20.1%
Effective Tax Rate 27.3%
Eff/ Tax Rate - 3 Yr. Avg. 25.9%
Payout Ratio 32.2%

SJR-B stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SJR-B stock intrinsic value calculation we used $4884 million for the last fiscal year's total revenue generated by Shaw Communications Inc. Class B Non-vot. The default revenue input number comes from 2016 income statement of Shaw Communications Inc. Class B Non-vot. 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 SJR-B stock valuation model: a) initial revenue growth rate of 8.9% 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 6.9%, whose default value for SJR-B is calculated based on our internal credit rating of Shaw Communications Inc. Class B Non-vot, 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 Shaw Communications Inc. Class B Non-vot.
    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 SJR-B stock the variable cost ratio is equal to 75.2%.

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 SJR-B 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 5.4% for Shaw Communications Inc. Class B Non-vot.

Corporate tax rate of 27% is the nominal tax rate for Shaw Communications Inc. Class B Non-vot. 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 SJR-B 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 SJR-B are equal to 152.6%.

Life of production assets of 9.3 years is the average useful life of capital assets used in Shaw Communications Inc. Class B Non-vot 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 SJR-B is equal to -19.2%. 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 - $5697 million for Shaw Communications Inc. Class B Non-vot - 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 498.807 million for Shaw Communications Inc. Class B Non-vot 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 Shaw Communications Inc. Class B Non-vot at the current share price and the inputted number of shares is $14.1 billion.

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Financial statements of SJR-B
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.

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