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

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$27.77

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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$27.77

 
Intrinsic value

$19.78

 
Up/down potential

-29%

 
Rating

sell

 
Value-price divergence* premium content

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

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 13.9

 

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
  14.90
  13.91
  13.02
  12.22
  11.50
  10.85
  10.26
  9.74
  9.26
  8.84
  8.45
  8.11
  7.80
  7.52
  7.26
  7.04
  6.83
  6.65
  6.49
  6.34
  6.20
  6.08
  5.97
  5.88
  5.79
  5.71
  5.64
  5.58
  5.52
  5.47
Revenue, $m
  4,884
  5,612
  6,392
  7,225
  8,107
  9,039
  10,019
  11,048
  12,123
  13,246
  14,416
  15,635
  16,902
  18,220
  19,589
  21,012
  22,491
  24,029
  25,627
  27,289
  29,018
  30,818
  32,693
  34,646
  36,683
  38,807
  41,023
  43,336
  45,753
  48,277
  50,916
Variable operating expenses, $m
 
  4,200
  4,766
  5,370
  6,010
  6,686
  7,396
  8,142
  8,922
  9,736
  10,584
  11,336
  12,255
  13,211
  14,204
  15,236
  16,308
  17,422
  18,581
  19,786
  21,040
  22,346
  23,705
  25,121
  26,598
  28,138
  29,745
  31,422
  33,174
  35,005
  36,918
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
  4,200
  4,766
  5,370
  6,010
  6,686
  7,396
  8,142
  8,922
  9,736
  10,584
  11,336
  12,255
  13,211
  14,204
  15,236
  16,308
  17,422
  18,581
  19,786
  21,040
  22,346
  23,705
  25,121
  26,598
  28,138
  29,745
  31,422
  33,174
  35,005
  36,918
Operating income, $m
  1,096
  1,411
  1,626
  1,855
  2,097
  2,354
  2,623
  2,906
  3,201
  3,510
  3,832
  4,298
  4,647
  5,009
  5,386
  5,777
  6,183
  6,606
  7,045
  7,502
  7,978
  8,473
  8,988
  9,525
  10,085
  10,669
  11,278
  11,914
  12,579
  13,273
  13,998
EBITDA, $m
  2,058
  2,464
  2,806
  3,172
  3,559
  3,968
  4,399
  4,850
  5,322
  5,815
  6,329
  6,864
  7,420
  7,999
  8,600
  9,225
  9,874
  10,549
  11,250
  11,980
  12,739
  13,530
  14,353
  15,210
  16,104
  17,037
  18,009
  19,025
  20,086
  21,194
  22,353
Interest expense (income), $m
  306
  281
  356
  437
  522
  613
  708
  809
  915
  1,025
  1,140
  1,261
  1,386
  1,516
  1,651
  1,792
  1,938
  2,090
  2,248
  2,412
  2,583
  2,760
  2,945
  3,138
  3,338
  3,547
  3,765
  3,993
  4,231
  4,479
  4,738
Earnings before tax, $m
  627
  1,130
  1,270
  1,418
  1,575
  1,741
  1,915
  2,097
  2,287
  2,485
  2,691
  3,038
  3,261
  3,493
  3,734
  3,985
  4,245
  4,516
  4,798
  5,090
  5,395
  5,713
  6,043
  6,388
  6,747
  7,122
  7,513
  7,921
  8,348
  8,794
  9,260
Tax expense, $m
  171
  305
  343
  383
  425
  470
  517
  566
  617
  671
  727
  820
  880
  943
  1,008
  1,076
  1,146
  1,219
  1,295
  1,374
  1,457
  1,542
  1,632
  1,725
  1,822
  1,923
  2,028
  2,139
  2,254
  2,374
  2,500
Net income, $m
  1,220
  825
  927
  1,035
  1,150
  1,271
  1,398
  1,531
  1,669
  1,814
  1,965
  2,218
  2,381
  2,550
  2,726
  2,909
  3,099
  3,297
  3,502
  3,716
  3,939
  4,170
  4,411
  4,663
  4,925
  5,199
  5,484
  5,782
  6,094
  6,419
  6,760

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
  17,214
  19,608
  22,161
  24,869
  27,727
  30,735
  33,888
  37,187
  40,632
  44,222
  47,959
  51,847
  55,889
  60,090
  64,455
  68,992
  73,707
  78,609
  83,708
  89,013
  94,535
  100,286
  106,278
  112,524
  119,039
  125,837
  132,933
  140,345
  148,090
  156,185
Adjusted assets (=assets-cash), $m
  14,977
  17,214
  19,608
  22,161
  24,869
  27,727
  30,735
  33,888
  37,187
  40,632
  44,222
  47,959
  51,847
  55,889
  60,090
  64,455
  68,992
  73,707
  78,609
  83,708
  89,013
  94,535
  100,286
  106,278
  112,524
  119,039
  125,837
  132,933
  140,345
  148,090
  156,185
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
  8,563
  9,755
  11,025
  12,372
  13,794
  15,290
  16,859
  18,500
  20,213
  21,999
  23,858
  25,793
  27,803
  29,893
  32,065
  34,322
  36,668
  39,106
  41,643
  44,282
  47,029
  49,890
  52,871
  55,978
  59,219
  62,601
  66,131
  69,818
  73,671
  77,698
Working capital, $m
  -943
  -1,077
  -1,227
  -1,387
  -1,557
  -1,736
  -1,924
  -2,121
  -2,328
  -2,543
  -2,768
  -3,002
  -3,245
  -3,498
  -3,761
  -4,034
  -4,318
  -4,613
  -4,920
  -5,239
  -5,571
  -5,917
  -6,277
  -6,652
  -7,043
  -7,451
  -7,876
  -8,321
  -8,785
  -9,269
  -9,776
Total debt, $m
  5,612
  6,600
  8,084
  9,667
  11,346
  13,118
  14,982
  16,938
  18,983
  21,119
  23,344
  25,662
  28,072
  30,578
  33,183
  35,889
  38,702
  41,625
  44,665
  47,826
  51,115
  54,539
  58,104
  61,819
  65,692
  69,731
  73,946
  78,346
  82,941
  87,743
  92,762
Total liabilities, $m
  9,685
  10,673
  12,157
  13,740
  15,419
  17,191
  19,055
  21,011
  23,056
  25,192
  27,417
  29,735
  32,145
  34,651
  37,256
  39,962
  42,775
  45,698
  48,738
  51,899
  55,188
  58,612
  62,177
  65,892
  69,765
  73,804
  78,019
  82,419
  87,014
  91,816
  96,835
Total equity, $m
  5,697
  6,541
  7,451
  8,421
  9,450
  10,536
  11,679
  12,878
  14,131
  15,440
  16,804
  18,224
  19,702
  21,238
  22,834
  24,493
  26,217
  28,009
  29,872
  31,809
  33,825
  35,923
  38,109
  40,385
  42,759
  45,235
  47,818
  50,515
  53,331
  56,274
  59,350
Total liabilities and equity, $m
  15,382
  17,214
  19,608
  22,161
  24,869
  27,727
  30,734
  33,889
  37,187
  40,632
  44,221
  47,959
  51,847
  55,889
  60,090
  64,455
  68,992
  73,707
  78,610
  83,708
  89,013
  94,535
  100,286
  106,277
  112,524
  119,039
  125,837
  132,934
  140,345
  148,090
  156,185
Debt-to-equity ratio
  0.985
  1.010
  1.080
  1.150
  1.200
  1.250
  1.280
  1.320
  1.340
  1.370
  1.390
  1.410
  1.420
  1.440
  1.450
  1.470
  1.480
  1.490
  1.500
  1.500
  1.510
  1.520
  1.520
  1.530
  1.540
  1.540
  1.550
  1.550
  1.560
  1.560
  1.560
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
  825
  927
  1,035
  1,150
  1,271
  1,398
  1,531
  1,669
  1,814
  1,965
  2,218
  2,381
  2,550
  2,726
  2,909
  3,099
  3,297
  3,502
  3,716
  3,939
  4,170
  4,411
  4,663
  4,925
  5,199
  5,484
  5,782
  6,094
  6,419
  6,760
Depreciation, amort., depletion, $m
  962
  1,052
  1,180
  1,317
  1,462
  1,615
  1,776
  1,944
  2,121
  2,305
  2,497
  2,565
  2,773
  2,990
  3,214
  3,448
  3,691
  3,943
  4,205
  4,478
  4,761
  5,057
  5,364
  5,685
  6,019
  6,368
  6,731
  7,111
  7,507
  7,922
  8,355
Funds from operations, $m
  1,735
  1,877
  2,107
  2,352
  2,612
  2,886
  3,173
  3,475
  3,790
  4,119
  4,462
  4,783
  5,154
  5,540
  5,940
  6,357
  6,790
  7,240
  7,707
  8,194
  8,700
  9,227
  9,776
  10,348
  10,944
  11,566
  12,216
  12,893
  13,601
  14,341
  15,114
Change in working capital, $m
  72
  -140
  -150
  -160
  -169
  -179
  -188
  -197
  -206
  -216
  -225
  -234
  -243
  -253
  -263
  -273
  -284
  -295
  -307
  -319
  -332
  -346
  -360
  -375
  -391
  -408
  -425
  -444
  -464
  -485
  -507
Cash from operations, $m
  1,663
  2,013
  2,257
  2,512
  2,781
  3,064
  3,362
  3,672
  3,997
  4,335
  4,686
  5,017
  5,397
  5,793
  6,203
  6,630
  7,074
  7,535
  8,014
  8,513
  9,032
  9,573
  10,136
  10,723
  11,335
  11,974
  12,641
  13,338
  14,065
  14,826
  15,621
Maintenance CAPEX, $m
  0
  -802
  -921
  -1,049
  -1,185
  -1,330
  -1,483
  -1,644
  -1,813
  -1,989
  -2,173
  -2,365
  -2,565
  -2,773
  -2,990
  -3,214
  -3,448
  -3,691
  -3,943
  -4,205
  -4,478
  -4,761
  -5,057
  -5,364
  -5,685
  -6,019
  -6,368
  -6,731
  -7,111
  -7,507
  -7,922
New CAPEX, $m
  -1,198
  -1,109
  -1,191
  -1,270
  -1,347
  -1,422
  -1,496
  -1,569
  -1,641
  -1,713
  -1,786
  -1,859
  -1,934
  -2,011
  -2,090
  -2,172
  -2,257
  -2,346
  -2,439
  -2,536
  -2,639
  -2,747
  -2,861
  -2,981
  -3,107
  -3,241
  -3,382
  -3,530
  -3,687
  -3,853
  -4,027
Cash from investing activities, $m
  -1,227
  -1,911
  -2,112
  -2,319
  -2,532
  -2,752
  -2,979
  -3,213
  -3,454
  -3,702
  -3,959
  -4,224
  -4,499
  -4,784
  -5,080
  -5,386
  -5,705
  -6,037
  -6,382
  -6,741
  -7,117
  -7,508
  -7,918
  -8,345
  -8,792
  -9,260
  -9,750
  -10,261
  -10,798
  -11,360
  -11,949
Free cash flow, $m
  436
  102
  145
  193
  249
  312
  382
  459
  543
  632
  727
  792
  898
  1,008
  1,124
  1,244
  1,369
  1,498
  1,633
  1,771
  1,915
  2,064
  2,218
  2,378
  2,543
  2,714
  2,892
  3,076
  3,267
  3,466
  3,672
Issuance/(repayment) of debt, $m
  -51
  1,393
  1,485
  1,583
  1,679
  1,772
  1,865
  1,955
  2,045
  2,135
  2,226
  2,317
  2,411
  2,506
  2,605
  2,707
  2,813
  2,923
  3,039
  3,161
  3,289
  3,424
  3,565
  3,715
  3,873
  4,039
  4,215
  4,400
  4,595
  4,802
  5,019
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
  1,393
  1,485
  1,583
  1,679
  1,772
  1,865
  1,955
  2,045
  2,135
  2,226
  2,317
  2,411
  2,506
  2,605
  2,707
  2,813
  2,923
  3,039
  3,161
  3,289
  3,424
  3,565
  3,715
  3,873
  4,039
  4,215
  4,400
  4,595
  4,802
  5,019
Total cash flow (excl. dividends), $m
  400
  1,495
  1,630
  1,776
  1,928
  2,084
  2,247
  2,415
  2,588
  2,767
  2,953
  3,109
  3,308
  3,514
  3,728
  3,951
  4,182
  4,422
  4,672
  4,933
  5,204
  5,488
  5,784
  6,093
  6,416
  6,753
  7,106
  7,476
  7,862
  8,267
  8,691
Retained Cash Flow (-), $m
  -885
  -844
  -910
  -970
  -1,029
  -1,086
  -1,143
  -1,198
  -1,254
  -1,309
  -1,364
  -1,420
  -1,477
  -1,536
  -1,596
  -1,659
  -1,724
  -1,792
  -1,863
  -1,937
  -2,016
  -2,098
  -2,185
  -2,277
  -2,374
  -2,476
  -2,583
  -2,697
  -2,817
  -2,943
  -3,076
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
 
  650
  720
  806
  899
  998
  1,104
  1,216
  1,334
  1,459
  1,589
  1,689
  1,831
  1,979
  2,132
  2,292
  2,458
  2,630
  2,809
  2,995
  3,188
  3,389
  3,598
  3,816
  4,042
  4,278
  4,523
  4,779
  5,046
  5,324
  5,615
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
 
  608
  626
  647
  661
  667
  665
  655
  636
  609
  575
  523
  480
  433
  385
  336
  288
  242
  200
  162
  128
  99
  75
  56
  40
  28
  19
  13
  8
  5
  3
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. operates as a diversified communications company in Canada and the United States. The company operates through Consumer, Business Network Services, Business Infrastructure Services, and Wireless segments. The Consumer segment provides cable telecommunications services, including video, Internet, WiFi and phone, and satellite video services. The Business Network Services segment provides data networking, video, voice, and Internet services through a national fiber-optic backbone network; and satellite video and fleet tracking services. The Business Infrastructure Services segment provides data center colocation, cloud, and managed services. The Wireless segment provides wireless voice and data communications services. The company was formerly known as Shaw Cable systems Ltd. and changed its name to Shaw Communications Inc. in May 1993. Shaw Communications Inc. was founded in 1966 and is based in Calgary, Canada.

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

Valuation Ratios
P/E Ratio 11.1
Price to Sales 2.8
Price to Book 2.4
Price to Tangible Book
Price to Cash Flow 8.1
Price to Free Cash Flow 29
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 14.9% 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 499.281 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 $13.9 billion.


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Stock chart of SJR-B Financial statements of SJR-B
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