Intrinsic value of Unisync Corp cl b - UNI

Previous Close

$2.95

  Intrinsic Value

$0.61

stock screener

  Rating & Target

str. sell

-79%

  Value-price divergence*

0%

Previous close

$2.95

 
Intrinsic value

$0.61

 
Up/down potential

-79%

 
Rating

str. sell

 
Value-price divergence*

0%

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

We calculate the intrinsic value of UNI 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 0.0

 

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, %
  17.78
  30.80
  28.22
  25.90
  23.81
  21.93
  20.23
  18.71
  17.34
  16.11
  15.00
  14.00
  13.10
  12.29
  11.56
  10.90
  10.31
  9.78
  9.30
  8.87
  8.49
  8.14
  7.82
  7.54
  7.29
  7.06
  6.85
  6.67
  6.50
  6.35
  6.22
Revenue, $m
  53
  69
  89
  112
  139
  169
  203
  241
  283
  328
  378
  431
  487
  547
  610
  677
  746
  819
  896
  975
  1,058
  1,144
  1,233
  1,326
  1,423
  1,523
  1,628
  1,736
  1,849
  1,967
  2,089
Variable operating expenses, $m
 
  69
  89
  112
  138
  168
  202
  240
  282
  327
  376
  428
  484
  544
  607
  673
  742
  815
  890
  970
  1,052
  1,137
  1,226
  1,319
  1,415
  1,515
  1,619
  1,726
  1,839
  1,955
  2,077
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
  53
  69
  89
  112
  138
  168
  202
  240
  282
  327
  376
  428
  484
  544
  607
  673
  742
  815
  890
  970
  1,052
  1,137
  1,226
  1,319
  1,415
  1,515
  1,619
  1,726
  1,839
  1,955
  2,077
Operating income, $m
  0
  0
  0
  0
  0
  1
  1
  1
  1
  2
  2
  2
  3
  3
  3
  4
  4
  5
  5
  6
  6
  6
  7
  8
  8
  9
  9
  10
  10
  11
  12
EBITDA, $m
  1
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  4
  5
  5
  6
  6
  7
  8
  8
  9
  10
  11
  12
  13
  13
  14
  15
  16
  17
  19
  20
Interest expense (income), $m
  1
  1
  2
  2
  3
  4
  5
  6
  7
  8
  9
  11
  12
  14
  16
  18
  20
  22
  24
  26
  29
  31
  34
  36
  39
  42
  45
  48
  51
  55
  58
Earnings before tax, $m
  -1
  -1
  -1
  -2
  -2
  -3
  -4
  -4
  -5
  -6
  -7
  -8
  -10
  -11
  -12
  -14
  -15
  -17
  -19
  -21
  -23
  -25
  -27
  -29
  -31
  -33
  -36
  -38
  -41
  -43
  -46
Tax expense, $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
  0
Net income, $m
  -1
  -1
  -1
  -2
  -2
  -3
  -4
  -4
  -5
  -6
  -7
  -8
  -10
  -11
  -12
  -14
  -15
  -17
  -19
  -21
  -23
  -25
  -27
  -29
  -31
  -33
  -36
  -38
  -41
  -43
  -46

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $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
  0
Total assets, $m
  41
  54
  69
  87
  107
  131
  157
  186
  219
  254
  292
  333
  377
  423
  472
  523
  577
  634
  693
  754
  818
  885
  954
  1,026
  1,101
  1,178
  1,259
  1,343
  1,430
  1,521
  1,615
Adjusted assets (=assets-cash), $m
  41
  54
  69
  87
  107
  131
  157
  186
  219
  254
  292
  333
  377
  423
  472
  523
  577
  634
  693
  754
  818
  885
  954
  1,026
  1,101
  1,178
  1,259
  1,343
  1,430
  1,521
  1,615
Revenue / Adjusted assets
  1.293
  1.278
  1.290
  1.287
  1.299
  1.290
  1.293
  1.296
  1.292
  1.291
  1.295
  1.294
  1.292
  1.293
  1.292
  1.294
  1.293
  1.292
  1.293
  1.293
  1.293
  1.293
  1.292
  1.292
  1.292
  1.293
  1.293
  1.293
  1.293
  1.293
  1.293
Average production assets, $m
  1
  1
  2
  2
  3
  3
  4
  5
  5
  6
  7
  8
  9
  10
  12
  13
  14
  16
  17
  19
  20
  22
  23
  25
  27
  29
  31
  33
  35
  37
  40
Working capital, $m
  3
  27
  35
  44
  55
  67
  80
  95
  112
  130
  150
  171
  193
  217
  242
  268
  296
  324
  355
  386
  419
  453
  488
  525
  563
  603
  645
  688
  732
  779
  827
Total debt, $m
  21
  31
  42
  55
  71
  89
  109
  131
  155
  182
  211
  242
  275
  310
  347
  386
  426
  469
  514
  560
  608
  659
  711
  765
  822
  881
  942
  1,005
  1,071
  1,140
  1,211
Total liabilities, $m
  30
  41
  52
  65
  81
  99
  119
  141
  165
  192
  221
  252
  285
  320
  357
  396
  436
  479
  524
  570
  618
  669
  721
  775
  832
  891
  952
  1,015
  1,081
  1,150
  1,221
Total equity, $m
  10
  13
  17
  21
  26
  32
  38
  46
  53
  62
  71
  81
  92
  103
  115
  128
  141
  155
  169
  184
  200
  216
  233
  250
  269
  287
  307
  328
  349
  371
  394
Total liabilities and equity, $m
  40
  54
  69
  86
  107
  131
  157
  187
  218
  254
  292
  333
  377
  423
  472
  524
  577
  634
  693
  754
  818
  885
  954
  1,025
  1,101
  1,178
  1,259
  1,343
  1,430
  1,521
  1,615
Debt-to-equity ratio
  2.100
  2.330
  2.500
  2.620
  2.720
  2.780
  2.840
  2.880
  2.910
  2.940
  2.960
  2.980
  2.990
  3.000
  3.010
  3.020
  3.030
  3.030
  3.040
  3.040
  3.050
  3.050
  3.060
  3.060
  3.060
  3.060
  3.070
  3.070
  3.070
  3.070
  3.070
Adjusted equity ratio
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244
  0.244

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -1
  -1
  -1
  -2
  -2
  -3
  -4
  -4
  -5
  -6
  -7
  -8
  -10
  -11
  -12
  -14
  -15
  -17
  -19
  -21
  -23
  -25
  -27
  -29
  -31
  -33
  -36
  -38
  -41
  -43
  -46
Depreciation, amort., depletion, $m
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  4
  4
  4
  5
  5
  5
  6
  6
  7
  7
  7
  8
Funds from operations, $m
  -6
  0
  -1
  -1
  -2
  -2
  -3
  -3
  -4
  -5
  -6
  -7
  -8
  -9
  -10
  -11
  -13
  -14
  -15
  -17
  -19
  -20
  -22
  -24
  -26
  -28
  -30
  -32
  -34
  -36
  -38
Change in working capital, $m
  -3
  6
  8
  9
  11
  12
  14
  15
  17
  18
  20
  21
  22
  24
  25
  26
  28
  29
  30
  31
  33
  34
  35
  37
  38
  40
  41
  43
  45
  47
  48
Cash from operations, $m
  -3
  -7
  -8
  -10
  -12
  -14
  -16
  -18
  -21
  -23
  -25
  -28
  -30
  -33
  -35
  -38
  -40
  -43
  -46
  -48
  -51
  -54
  -57
  -61
  -64
  -67
  -71
  -75
  -78
  -83
  -87
Maintenance CAPEX, $m
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -5
  -5
  -5
  -6
  -6
  -7
  -7
  -7
New CAPEX, $m
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
Cash from investing activities, $m
  0
  0
  0
  0
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -9
  -9
  -9
Free cash flow, $m
  -3
  -7
  -9
  -11
  -13
  -15
  -17
  -20
  -22
  -25
  -27
  -30
  -33
  -36
  -38
  -41
  -44
  -47
  -50
  -53
  -57
  -60
  -63
  -67
  -71
  -75
  -79
  -83
  -87
  -92
  -97
Issuance/(repayment) of debt, $m
  1
  10
  11
  13
  16
  18
  20
  22
  24
  27
  29
  31
  33
  35
  37
  39
  41
  43
  45
  46
  48
  50
  52
  54
  57
  59
  61
  63
  66
  69
  71
Issuance/(repurchase) of shares, $m
  1
  4
  5
  6
  7
  9
  10
  12
  13
  15
  17
  18
  20
  22
  24
  26
  29
  31
  33
  36
  38
  41
  44
  46
  49
  52
  55
  59
  62
  66
  69
Cash from financing (excl. dividends), $m  
  3
  14
  16
  19
  23
  27
  30
  34
  37
  42
  46
  49
  53
  57
  61
  65
  70
  74
  78
  82
  86
  91
  96
  100
  106
  111
  116
  122
  128
  135
  140
Total cash flow (excl. dividends), $m
  0
  6
  7
  9
  10
  11
  13
  14
  15
  17
  18
  19
  20
  22
  23
  24
  25
  26
  28
  29
  30
  31
  32
  34
  35
  36
  38
  39
  41
  43
  44
Retained Cash Flow (-), $m
  0
  -4
  -5
  -6
  -7
  -9
  -10
  -12
  -13
  -15
  -17
  -18
  -20
  -22
  -24
  -26
  -29
  -31
  -33
  -36
  -38
  -41
  -44
  -46
  -49
  -52
  -55
  -59
  -62
  -66
  -69
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
 
  2
  2
  2
  3
  3
  3
  2
  2
  2
  1
  1
  0
  -1
  -1
  -2
  -3
  -4
  -6
  -7
  -8
  -10
  -11
  -13
  -14
  -16
  -18
  -19
  -21
  -23
  -25
Discount rate, %
 
  11.80
  12.39
  13.01
  13.66
  14.34
  15.06
  15.81
  16.60
  17.43
  18.31
  19.22
  20.18
  21.19
  22.25
  23.36
  24.53
  25.76
  27.05
  28.40
  29.82
  31.31
  32.87
  34.52
  36.24
  38.06
  39.96
  41.96
  44.05
  46.26
  48.57
PV of cash for distribution, $m
 
  2
  2
  2
  2
  1
  1
  1
  1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  90.6
  82.6
  75.5
  69.4
  64.0
  59.2
  54.9
  51.1
  47.7
  44.7
  41.9
  39.4
  37.2
  35.1
  33.1
  31.3
  29.7
  28.2
  26.7
  25.4
  24.1
  23.0
  21.9
  20.8
  19.8
  18.9
  18.0
  17.2
  16.4
  15.7

Unisync Corp. (Unisync) is a Canada-based independent uniform provider. The Company is engaged in garment design, domestic manufacturing and offshore outsourcing, combined with Web-based business-to-business (B2B) ordering, distribution and program management systems. Unisync operates through two segments: Unisync Group Limited (UGL) of Mississauga, Ontario and Peerless Garments LP (Peerless) of Winnipeg, Manitoba. UGL is a provider of corporate apparel, serving a list of Canadian brands in various industries. Peerless is engaged in the production and distribution of technical protective garments, military operational clothing and accessories for a range of federal, provincial and municipal government departments and agencies, such as the Armed Forces and the Royal Canadian Mounted Police (RCMP). It offers products under various brands, such as Hammill, York and Rapier. Its services include creative design, technical specification development, global sourcing and inventory planning.

FINANCIAL RATIOS  of  Unisync Corp cl b (UNI)

Valuation Ratios
P/E Ratio -39.2
Price to Sales 0.7
Price to Book 3.9
Price to Tangible Book
Price to Cash Flow -13.1
Price to Free Cash Flow -13.1
Growth Rates
Sales Growth Rate 17.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -100%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio 0
Current Ratio 0
LT Debt to Equity 30%
Total Debt to Equity 210%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. -1%
Return On Total Capital -3.4%
Ret/ On T. Cap. - 3 Yr. Avg. -2.4%
Return On Equity -10%
Return On Equity - 3 Yr. Avg. -6.7%
Asset Turnover 1.4
Profitability Ratios
Gross Margin 17%
Gross Margin - 3 Yr. Avg. 19.2%
EBITDA Margin 1.9%
EBITDA Margin - 3 Yr. Avg. 1.4%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin -1.9%
Pre-Tax Margin - 3 Yr. Avg. -1.4%
Net Profit Margin -1.9%
Net Profit Margin - 3 Yr. Avg. -1.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 33.3%
Payout Ratio 0%

UNI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the UNI stock intrinsic value calculation we used $53 million for the last fiscal year's total revenue generated by Unisync Corp cl b. The default revenue input number comes from 2016 income statement of Unisync Corp cl b. 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 UNI stock valuation model: a) initial revenue growth rate of 30.8% 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 11.8%, whose default value for UNI is calculated based on our internal credit rating of Unisync Corp cl b, 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 Unisync Corp cl b.
    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 UNI stock the variable cost ratio is equal to 100%.

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 UNI 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 5.1% for Unisync Corp cl b.

Corporate tax rate of 27% is the nominal tax rate for Unisync Corp cl b. 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 UNI 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 UNI are equal to 1.9%.

Life of production assets of 4 years is the average useful life of capital assets used in Unisync Corp cl b 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 UNI is equal to 39.6%. 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 - $10 million for Unisync Corp cl b - 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 13.338 million for Unisync Corp cl b 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 Unisync Corp cl b at the current share price and the inputted number of shares is $0.0 billion.

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Financial statements of UNI
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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