Intrinsic value of ABB ADR - ABB

Previous Close

$25.23

  Intrinsic Value

$22.01

stock screener

  Rating & Target

hold

-13%

Previous close

$25.23

 
Intrinsic value

$22.01

 
Up/down potential

-13%

 
Rating

hold

We calculate the intrinsic value of ABB 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 55.0

 

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, %
  -4.66
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  33,828
  34,505
  35,298
  36,205
  37,224
  38,352
  39,591
  40,939
  42,398
  43,971
  45,658
  47,464
  49,390
  51,441
  53,621
  55,934
  58,385
  60,980
  63,723
  66,623
  69,684
  72,914
  76,320
  79,911
  83,694
  87,678
  91,873
  96,289
  100,935
  105,824
  110,965
Variable operating expenses, $m
 
  31,518
  32,221
  33,025
  33,927
  34,927
  36,024
  37,218
  38,511
  39,904
  41,399
  42,049
  43,755
  45,572
  47,503
  49,552
  51,724
  54,023
  56,453
  59,022
  61,734
  64,595
  67,613
  70,794
  74,146
  77,675
  81,392
  85,304
  89,420
  93,751
  98,306
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
  30,841
  31,518
  32,221
  33,025
  33,927
  34,927
  36,024
  37,218
  38,511
  39,904
  41,399
  42,049
  43,755
  45,572
  47,503
  49,552
  51,724
  54,023
  56,453
  59,022
  61,734
  64,595
  67,613
  70,794
  74,146
  77,675
  81,392
  85,304
  89,420
  93,751
  98,306
Operating income, $m
  2,987
  2,986
  3,077
  3,180
  3,297
  3,425
  3,567
  3,720
  3,887
  4,066
  4,259
  5,415
  5,635
  5,869
  6,117
  6,381
  6,661
  6,957
  7,270
  7,601
  7,950
  8,318
  8,707
  9,117
  9,548
  10,003
  10,481
  10,985
  11,515
  12,073
  12,660
EBITDA, $m
  4,122
  4,322
  4,422
  4,535
  4,663
  4,804
  4,959
  5,128
  5,311
  5,508
  5,719
  5,946
  6,187
  6,444
  6,717
  7,007
  7,314
  7,639
  7,982
  8,346
  8,729
  9,134
  9,560
  10,010
  10,484
  10,983
  11,509
  12,062
  12,644
  13,256
  13,900
Interest expense (income), $m
  213
  203
  220
  240
  264
  290
  319
  350
  385
  422
  463
  506
  552
  602
  654
  710
  770
  832
  899
  969
  1,044
  1,122
  1,205
  1,293
  1,385
  1,482
  1,584
  1,691
  1,805
  1,924
  2,049
Earnings before tax, $m
  2,799
  2,783
  2,857
  2,940
  3,033
  3,136
  3,248
  3,370
  3,502
  3,644
  3,796
  4,909
  5,082
  5,267
  5,463
  5,671
  5,891
  6,124
  6,371
  6,631
  6,906
  7,196
  7,502
  7,824
  8,164
  8,521
  8,898
  9,294
  9,711
  10,149
  10,610
Tax expense, $m
  781
  752
  771
  794
  819
  847
  877
  910
  946
  984
  1,025
  1,325
  1,372
  1,422
  1,475
  1,531
  1,591
  1,654
  1,720
  1,790
  1,865
  1,943
  2,026
  2,113
  2,204
  2,301
  2,402
  2,509
  2,622
  2,740
  2,865
Net income, $m
  1,899
  2,032
  2,086
  2,146
  2,214
  2,289
  2,371
  2,460
  2,556
  2,660
  2,771
  3,584
  3,710
  3,845
  3,988
  4,140
  4,301
  4,471
  4,651
  4,841
  5,042
  5,253
  5,476
  5,712
  5,960
  6,221
  6,495
  6,784
  7,089
  7,409
  7,746

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  5,597
  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
  39,202
  34,265
  35,053
  35,954
  36,965
  38,086
  39,315
  40,654
  42,104
  43,665
  45,341
  47,134
  49,047
  51,083
  53,248
  55,545
  57,979
  60,556
  63,280
  66,160
  69,199
  72,407
  75,790
  79,355
  83,112
  87,069
  91,235
  95,620
  100,234
  105,088
  110,194
Adjusted assets (=assets-cash), $m
  33,605
  34,265
  35,053
  35,954
  36,965
  38,086
  39,315
  40,654
  42,104
  43,665
  45,341
  47,134
  49,047
  51,083
  53,248
  55,545
  57,979
  60,556
  63,280
  66,160
  69,199
  72,407
  75,790
  79,355
  83,112
  87,069
  91,235
  95,620
  100,234
  105,088
  110,194
Revenue / Adjusted assets
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
  1.007
Average production assets, $m
  4,805
  4,900
  5,012
  5,141
  5,286
  5,446
  5,622
  5,813
  6,021
  6,244
  6,483
  6,740
  7,013
  7,305
  7,614
  7,943
  8,291
  8,659
  9,049
  9,460
  9,895
  10,354
  10,837
  11,347
  11,885
  12,450
  13,046
  13,673
  14,333
  15,027
  15,757
Working capital, $m
  5,903
  1,346
  1,377
  1,412
  1,452
  1,496
  1,544
  1,597
  1,654
  1,715
  1,781
  1,851
  1,926
  2,006
  2,091
  2,181
  2,277
  2,378
  2,485
  2,598
  2,718
  2,844
  2,976
  3,117
  3,264
  3,419
  3,583
  3,755
  3,936
  4,127
  4,328
Total debt, $m
  6,803
  6,283
  6,865
  7,530
  8,276
  9,103
  10,011
  10,999
  12,068
  13,221
  14,458
  15,781
  17,192
  18,695
  20,293
  21,988
  23,785
  25,686
  27,697
  29,822
  32,065
  34,432
  36,929
  39,560
  42,333
  45,253
  48,327
  51,563
  54,968
  58,551
  62,319
Total liabilities, $m
  25,807
  25,287
  25,869
  26,534
  27,280
  28,107
  29,015
  30,003
  31,072
  32,225
  33,462
  34,785
  36,196
  37,699
  39,297
  40,992
  42,789
  44,690
  46,701
  48,826
  51,069
  53,436
  55,933
  58,564
  61,337
  64,257
  67,331
  70,567
  73,972
  77,555
  81,323
Total equity, $m
  13,395
  8,977
  9,184
  9,420
  9,685
  9,978
  10,301
  10,651
  11,031
  11,440
  11,879
  12,349
  12,850
  13,384
  13,951
  14,553
  15,191
  15,866
  16,579
  17,334
  18,130
  18,971
  19,857
  20,791
  21,775
  22,812
  23,903
  25,052
  26,261
  27,533
  28,871
Total liabilities and equity, $m
  39,202
  34,264
  35,053
  35,954
  36,965
  38,085
  39,316
  40,654
  42,103
  43,665
  45,341
  47,134
  49,046
  51,083
  53,248
  55,545
  57,980
  60,556
  63,280
  66,160
  69,199
  72,407
  75,790
  79,355
  83,112
  87,069
  91,234
  95,619
  100,233
  105,088
  110,194
Debt-to-equity ratio
  0.508
  0.700
  0.750
  0.800
  0.850
  0.910
  0.970
  1.030
  1.090
  1.160
  1.220
  1.280
  1.340
  1.400
  1.450
  1.510
  1.570
  1.620
  1.670
  1.720
  1.770
  1.820
  1.860
  1.900
  1.940
  1.980
  2.020
  2.060
  2.090
  2.130
  2.160
Adjusted equity ratio
  0.232
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262
  0.262

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,899
  2,032
  2,086
  2,146
  2,214
  2,289
  2,371
  2,460
  2,556
  2,660
  2,771
  3,584
  3,710
  3,845
  3,988
  4,140
  4,301
  4,471
  4,651
  4,841
  5,042
  5,253
  5,476
  5,712
  5,960
  6,221
  6,495
  6,784
  7,089
  7,409
  7,746
Depreciation, amort., depletion, $m
  1,135
  1,336
  1,345
  1,355
  1,366
  1,379
  1,393
  1,408
  1,424
  1,442
  1,461
  531
  552
  575
  600
  625
  653
  682
  712
  745
  779
  815
  853
  893
  936
  980
  1,027
  1,077
  1,129
  1,183
  1,241
Funds from operations, $m
  4,502
  3,368
  3,430
  3,501
  3,580
  3,668
  3,764
  3,868
  3,981
  4,102
  4,232
  4,114
  4,262
  4,420
  4,588
  4,765
  4,953
  5,153
  5,363
  5,586
  5,821
  6,068
  6,330
  6,605
  6,895
  7,201
  7,523
  7,861
  8,217
  8,592
  8,986
Change in working capital, $m
  659
  26
  31
  35
  40
  44
  48
  53
  57
  61
  66
  70
  75
  80
  85
  90
  96
  101
  107
  113
  119
  126
  133
  140
  148
  155
  164
  172
  181
  191
  201
Cash from operations, $m
  3,843
  3,341
  3,399
  3,466
  3,541
  3,624
  3,716
  3,815
  3,924
  4,041
  4,166
  4,044
  4,187
  4,340
  4,503
  4,675
  4,858
  5,051
  5,256
  5,473
  5,701
  5,943
  6,197
  6,465
  6,748
  7,045
  7,359
  7,689
  8,036
  8,401
  8,786
Maintenance CAPEX, $m
  0
  -378
  -386
  -395
  -405
  -416
  -429
  -443
  -458
  -474
  -492
  -511
  -531
  -552
  -575
  -600
  -625
  -653
  -682
  -712
  -745
  -779
  -815
  -853
  -893
  -936
  -980
  -1,027
  -1,077
  -1,129
  -1,183
New CAPEX, $m
  -831
  -95
  -113
  -129
  -145
  -160
  -176
  -191
  -207
  -223
  -240
  -256
  -274
  -291
  -310
  -328
  -348
  -368
  -390
  -412
  -435
  -459
  -484
  -510
  -537
  -566
  -596
  -627
  -660
  -694
  -730
Cash from investing activities, $m
  -1,305
  -473
  -499
  -524
  -550
  -576
  -605
  -634
  -665
  -697
  -732
  -767
  -805
  -843
  -885
  -928
  -973
  -1,021
  -1,072
  -1,124
  -1,180
  -1,238
  -1,299
  -1,363
  -1,430
  -1,502
  -1,576
  -1,654
  -1,737
  -1,823
  -1,913
Free cash flow, $m
  2,538
  2,868
  2,901
  2,942
  2,991
  3,048
  3,111
  3,181
  3,259
  3,343
  3,435
  3,277
  3,383
  3,497
  3,618
  3,747
  3,884
  4,030
  4,185
  4,349
  4,522
  4,705
  4,898
  5,102
  5,317
  5,544
  5,783
  6,035
  6,300
  6,579
  6,872
Issuance/(repayment) of debt, $m
  -489
  483
  582
  665
  746
  827
  907
  988
  1,070
  1,152
  1,237
  1,323
  1,412
  1,503
  1,597
  1,695
  1,796
  1,902
  2,011
  2,125
  2,243
  2,367
  2,496
  2,631
  2,772
  2,920
  3,074
  3,236
  3,405
  3,582
  3,768
Issuance/(repurchase) of shares, $m
  -1,107
  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  
  -3,355
  483
  582
  665
  746
  827
  907
  988
  1,070
  1,152
  1,237
  1,323
  1,412
  1,503
  1,597
  1,695
  1,796
  1,902
  2,011
  2,125
  2,243
  2,367
  2,496
  2,631
  2,772
  2,920
  3,074
  3,236
  3,405
  3,582
  3,768
Total cash flow (excl. dividends), $m
  -921
  3,351
  3,483
  3,607
  3,738
  3,875
  4,018
  4,169
  4,328
  4,496
  4,671
  4,600
  4,795
  5,000
  5,215
  5,442
  5,681
  5,932
  6,196
  6,473
  6,765
  7,072
  7,394
  7,733
  8,090
  8,464
  8,857
  9,271
  9,705
  10,161
  10,641
Retained Cash Flow (-), $m
  1,086
  -176
  -206
  -236
  -265
  -294
  -322
  -351
  -380
  -409
  -439
  -470
  -501
  -534
  -567
  -602
  -638
  -675
  -714
  -754
  -796
  -840
  -886
  -934
  -984
  -1,037
  -1,091
  -1,149
  -1,209
  -1,272
  -1,338
Prev. year cash balance distribution, $m
 
  4,594
  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
 
  7,769
  3,276
  3,371
  3,473
  3,581
  3,696
  3,819
  3,949
  4,086
  4,232
  4,130
  4,294
  4,466
  4,648
  4,840
  5,043
  5,257
  5,482
  5,719
  5,969
  6,232
  6,508
  6,799
  7,105
  7,427
  7,766
  8,122
  8,496
  8,889
  9,303
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  7,449
  2,999
  2,934
  2,859
  2,776
  2,682
  2,580
  2,468
  2,347
  2,219
  1,961
  1,832
  1,698
  1,560
  1,421
  1,282
  1,144
  1,010
  881
  758
  645
  540
  446
  362
  289
  227
  174
  131
  97
  70
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

ABB Ltd (ABB) is a holding company. The Company's segments include Electrification Products, Robotics and Motion, Industrial Automation, Power Grids, and Corporate and Other. It operates through four divisions: Electrification Products, Robotics and Motion, Industrial Automation and Power Grids. It is engaged in serving customers in utilities, industry and transport and infrastructure. The Electrification Products segment manufactures and sells products and services including low and medium-voltage switchgear, breakers, switches and control products. The Robotics and Motion segment manufactures and sells motors, generators, variable speed drives and robots and robotics. The Industrial Automation segment develops and sells control and plant optimization systems, and automation products and solutions. The Power Grids segment supplies power and automation products, systems, and service and software solutions.

FINANCIAL RATIOS  of  ABB ADR (ABB)

Valuation Ratios
P/E Ratio 28.4
Price to Sales 1.6
Price to Book 4
Price to Tangible Book
Price to Cash Flow 14
Price to Free Cash Flow 17.9
Growth Rates
Sales Growth Rate -4.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -5.1%
Cap. Spend. - 3 Yr. Gr. Rate -5.6%
Financial Strength
Quick Ratio 6
Current Ratio 0.1
LT Debt to Equity 43.3%
Total Debt to Equity 50.8%
Interest Coverage 14
Management Effectiveness
Return On Assets 5.1%
Ret/ On Assets - 3 Yr. Avg. 5.3%
Return On Total Capital 9%
Ret/ On T. Cap. - 3 Yr. Avg. 9.2%
Return On Equity 13.6%
Return On Equity - 3 Yr. Avg. 13.7%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 28.8%
Gross Margin - 3 Yr. Avg. 28.5%
EBITDA Margin 12.3%
EBITDA Margin - 3 Yr. Avg. 12.6%
Operating Margin 8.8%
Oper. Margin - 3 Yr. Avg. 9.3%
Pre-Tax Margin 8.3%
Pre-Tax Margin - 3 Yr. Avg. 8.7%
Net Profit Margin 5.6%
Net Profit Margin - 3 Yr. Avg. 5.9%
Effective Tax Rate 27.9%
Eff/ Tax Rate - 3 Yr. Avg. 28.8%
Payout Ratio 0%

ABB stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ABB stock intrinsic value calculation we used $33828 million for the last fiscal year's total revenue generated by ABB ADR. The default revenue input number comes from 2016 income statement of ABB ADR. 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 ABB stock valuation model: a) initial revenue growth rate of 2% 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 4.3%, whose default value for ABB is calculated based on our internal credit rating of ABB ADR, 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 ABB ADR.
    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 ABB stock the variable cost ratio is equal to 91.4%.

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 ABB 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 3.5% for ABB ADR.

Corporate tax rate of 27% is the nominal tax rate for ABB ADR. 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 ABB 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 ABB are equal to 14.2%.

Life of production assets of 12.7 years is the average useful life of capital assets used in ABB ADR 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 ABB is equal to 3.9%. 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 - $13395 million for ABB ADR - 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 2180.28 million for ABB ADR 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 ABB ADR at the current share price and the inputted number of shares is $55.0 billion.

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COMPANY NEWS

▶ ETFs with exposure to ABB Ltd. : November 17, 2017   [Nov-17-17 11:15AM  Capital Cube]
▶ ETFs with exposure to ABB Ltd. : November 7, 2017   [Nov-07-17 09:32AM  Capital Cube]
▶ ETFs with exposure to ABB Ltd. : October 25, 2017   [Oct-25-17 09:44AM  Capital Cube]
▶ 3 Stocks to Buy for the Next Generation   [08:00AM  Motley Fool]
▶ 2 International Stocks for Retirees   [Oct-03-17 06:22AM  Motley Fool]
▶ GE Sells Industrial Solutions Segment to ABB   [Oct-01-17 04:30PM  Motley Fool]
▶ A Wall Street Wedding (and a Divorce)   [03:18PM  Motley Fool]
▶ [$$] GE Agrees to Sell Industrial Unit to ABB for $2.6 Billion   [Sep-25-17 11:02AM  The Wall Street Journal]
▶ ETFs with exposure to ABB Ltd. : August 14, 2017   [Aug-14-17 04:03PM  Capital Cube]
▶ ETFs with exposure to ABB Ltd. : August 3, 2017   [Aug-03-17 07:26PM  Capital Cube]
▶ ABB beats 2Q profit forecasts   [12:31AM  Associated Press]
▶ SolarEdge Outshines Competitors, Analyst Upgrades   [Jul-18-17 09:21AM  Benzinga]
▶ The World's Top 4 Alternative Energy Companies in 2017   [Jul-12-17 04:23PM  Investopedia]
▶ ETFs with exposure to ABB Ltd. : June 12, 2017   [Jun-12-17 01:45PM  Capital Cube]
▶ ABB's YuMi rings the NASDAQ opening bell   [11:42AM  PR Newswire]
▶ 3 Top Dividend Stocks in Electrical Equipment Industry   [Jun-09-17 10:17AM  Motley Fool]
▶ ETFs with exposure to ABB Ltd. : May 30, 2017   [May-30-17 12:14PM  Capital Cube]
▶ ABB strengthens commitment to Canada   [May-24-17 10:00AM  PR Newswire]
▶ ETFs with exposure to ABB Ltd. : May 19, 2017   [May-19-17 01:37PM  Capital Cube]
▶ Better Buy: Caterpillar Inc. vs ABB Ltd.   [May-16-17 10:45AM  Motley Fool]
▶ ETFs with exposure to ABB Ltd. : May 8, 2017   [May-08-17 04:05PM  Capital Cube]
▶ ETFs with exposure to ABB Ltd. : April 26, 2017   [Apr-26-17 03:03PM  Capital Cube]
▶ The Best Electrical Equipment Stocks to Buy in 2017   [Apr-17-17 11:30AM  Motley Fool]
▶ The $20 Billion Takeover Target That Wasn't   [Apr-05-17 03:09PM  Bloomberg]
▶ 7 Stocks That Are Outperforming the Market   [Mar-22-17 05:44PM  GuruFocus.com]
Financial statements of ABB
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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