Intrinsic value of AU Optronics ADR - AUO

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$4.01

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$4.01

 
Intrinsic value

$2.03

 
Up/down potential

-49%

 
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 AUO 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 3.9

 

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, %
  -8.68
  10.10
  9.59
  9.13
  8.72
  8.35
  8.01
  7.71
  7.44
  7.20
  6.98
  6.78
  6.60
  6.44
  6.30
  6.17
  6.05
  5.95
  5.85
  5.77
  5.69
  5.62
  5.56
  5.50
  5.45
  5.41
  5.37
  5.33
  5.30
  5.27
  5.24
Revenue, $m
  10,580
  11,649
  12,766
  13,931
  15,146
  16,410
  17,725
  19,091
  20,511
  21,987
  23,521
  25,115
  26,773
  28,498
  30,292
  32,160
  34,106
  36,133
  38,247
  40,452
  42,754
  45,156
  47,666
  50,289
  53,031
  55,898
  58,897
  62,036
  65,322
  68,763
  72,366
Variable operating expenses, $m
 
  11,470
  12,567
  13,711
  14,903
  16,144
  17,434
  18,776
  20,170
  21,618
  23,124
  24,653
  26,280
  27,972
  29,734
  31,567
  33,477
  35,467
  37,542
  39,707
  41,966
  44,324
  46,788
  49,362
  52,053
  54,868
  57,812
  60,893
  64,118
  67,495
  71,032
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
  10,215
  11,470
  12,567
  13,711
  14,903
  16,144
  17,434
  18,776
  20,170
  21,618
  23,124
  24,653
  26,280
  27,972
  29,734
  31,567
  33,477
  35,467
  37,542
  39,707
  41,966
  44,324
  46,788
  49,362
  52,053
  54,868
  57,812
  60,893
  64,118
  67,495
  71,032
Operating income, $m
  365
  178
  199
  220
  243
  266
  290
  316
  342
  369
  397
  463
  493
  525
  558
  593
  629
  666
  705
  746
  788
  832
  879
  927
  977
  1,030
  1,086
  1,143
  1,204
  1,267
  1,334
EBITDA, $m
  1,641
  1,548
  1,697
  1,852
  2,013
  2,181
  2,356
  2,537
  2,726
  2,922
  3,126
  3,338
  3,559
  3,788
  4,026
  4,274
  4,533
  4,803
  5,084
  5,377
  5,683
  6,002
  6,335
  6,684
  7,048
  7,430
  7,828
  8,245
  8,682
  9,139
  9,618
Interest expense (income), $m
  68
  119
  145
  173
  201
  231
  261
  293
  327
  361
  397
  434
  473
  514
  556
  599
  645
  692
  742
  793
  847
  903
  961
  1,022
  1,086
  1,153
  1,223
  1,296
  1,372
  1,452
  1,536
Earnings before tax, $m
  360
  59
  54
  48
  42
  36
  29
  22
  15
  8
  0
  28
  20
  12
  3
  -7
  -16
  -26
  -37
  -47
  -59
  -70
  -83
  -95
  -109
  -123
  -137
  -152
  -168
  -185
  -202
Tax expense, $m
  148
  16
  14
  13
  11
  10
  8
  6
  4
  2
  0
  8
  5
  3
  1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  251
  43
  39
  35
  31
  26
  21
  16
  11
  6
  0
  21
  15
  8
  2
  -7
  -16
  -26
  -37
  -47
  -59
  -70
  -83
  -95
  -109
  -123
  -137
  -152
  -168
  -185
  -202

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  2,596
  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
  13,817
  12,353
  13,537
  14,773
  16,061
  17,402
  18,796
  20,245
  21,751
  23,316
  24,943
  26,634
  28,392
  30,220
  32,123
  34,104
  36,167
  38,317
  40,559
  42,897
  45,338
  47,886
  50,547
  53,329
  56,236
  59,277
  62,457
  65,786
  69,271
  72,919
  76,740
Adjusted assets (=assets-cash), $m
  11,221
  12,353
  13,537
  14,773
  16,061
  17,402
  18,796
  20,245
  21,751
  23,316
  24,943
  26,634
  28,392
  30,220
  32,123
  34,104
  36,167
  38,317
  40,559
  42,897
  45,338
  47,886
  50,547
  53,329
  56,236
  59,277
  62,457
  65,786
  69,271
  72,919
  76,740
Revenue / Adjusted assets
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
  0.943
Average production assets, $m
  7,027
  7,735
  8,476
  9,250
  10,057
  10,896
  11,769
  12,677
  13,620
  14,600
  15,618
  16,677
  17,777
  18,922
  20,114
  21,354
  22,646
  23,992
  25,396
  26,860
  28,388
  29,984
  31,650
  33,392
  35,212
  37,116
  39,108
  41,192
  43,374
  45,658
  48,051
Working capital, $m
  1,481
  -536
  -587
  -641
  -697
  -755
  -815
  -878
  -944
  -1,011
  -1,082
  -1,155
  -1,232
  -1,311
  -1,393
  -1,479
  -1,569
  -1,662
  -1,759
  -1,861
  -1,967
  -2,077
  -2,193
  -2,313
  -2,439
  -2,571
  -2,709
  -2,854
  -3,005
  -3,163
  -3,329
Total debt, $m
  4,041
  4,154
  4,931
  5,742
  6,587
  7,467
  8,381
  9,332
  10,320
  11,347
  12,414
  13,523
  14,676
  15,875
  17,124
  18,423
  19,777
  21,187
  22,658
  24,192
  25,793
  27,464
  29,210
  31,035
  32,942
  34,936
  37,023
  39,207
  41,492
  43,886
  46,392
Total liabilities, $m
  7,990
  8,103
  8,880
  9,691
  10,536
  11,416
  12,330
  13,281
  14,269
  15,296
  16,363
  17,472
  18,625
  19,824
  21,073
  22,372
  23,726
  25,136
  26,607
  28,141
  29,742
  31,413
  33,159
  34,984
  36,891
  38,885
  40,972
  43,156
  45,441
  47,835
  50,341
Total equity, $m
  5,827
  4,249
  4,657
  5,082
  5,525
  5,986
  6,466
  6,964
  7,482
  8,021
  8,580
  9,162
  9,767
  10,396
  11,050
  11,732
  12,441
  13,181
  13,952
  14,757
  15,596
  16,473
  17,388
  18,345
  19,345
  20,391
  21,485
  22,630
  23,829
  25,084
  26,399
Total liabilities and equity, $m
  13,817
  12,352
  13,537
  14,773
  16,061
  17,402
  18,796
  20,245
  21,751
  23,317
  24,943
  26,634
  28,392
  30,220
  32,123
  34,104
  36,167
  38,317
  40,559
  42,898
  45,338
  47,886
  50,547
  53,329
  56,236
  59,276
  62,457
  65,786
  69,270
  72,919
  76,740
Debt-to-equity ratio
  0.693
  0.980
  1.060
  1.130
  1.190
  1.250
  1.300
  1.340
  1.380
  1.410
  1.450
  1.480
  1.500
  1.530
  1.550
  1.570
  1.590
  1.610
  1.620
  1.640
  1.650
  1.670
  1.680
  1.690
  1.700
  1.710
  1.720
  1.730
  1.740
  1.750
  1.760
Adjusted equity ratio
  0.289
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  251
  43
  39
  35
  31
  26
  21
  16
  11
  6
  0
  21
  15
  8
  2
  -7
  -16
  -26
  -37
  -47
  -59
  -70
  -83
  -95
  -109
  -123
  -137
  -152
  -168
  -185
  -202
Depreciation, amort., depletion, $m
  1,276
  1,370
  1,498
  1,631
  1,770
  1,915
  2,065
  2,222
  2,385
  2,553
  2,729
  2,875
  3,065
  3,262
  3,468
  3,682
  3,904
  4,137
  4,379
  4,631
  4,895
  5,170
  5,457
  5,757
  6,071
  6,399
  6,743
  7,102
  7,478
  7,872
  8,285
Funds from operations, $m
  678
  1,413
  1,537
  1,666
  1,801
  1,941
  2,087
  2,238
  2,396
  2,559
  2,729
  2,896
  3,080
  3,271
  3,470
  3,675
  3,888
  4,110
  4,342
  4,584
  4,836
  5,099
  5,374
  5,662
  5,962
  6,277
  6,605
  6,950
  7,310
  7,687
  8,082
Change in working capital, $m
  -502
  -49
  -51
  -54
  -56
  -58
  -60
  -63
  -65
  -68
  -71
  -73
  -76
  -79
  -83
  -86
  -90
  -93
  -97
  -101
  -106
  -111
  -115
  -121
  -126
  -132
  -138
  -144
  -151
  -158
  -166
Cash from operations, $m
  1,180
  1,671
  1,588
  1,720
  1,857
  1,999
  2,147
  2,301
  2,461
  2,627
  2,800
  2,969
  3,156
  3,350
  3,552
  3,761
  3,978
  4,204
  4,439
  4,685
  4,942
  5,210
  5,490
  5,782
  6,088
  6,409
  6,743
  7,094
  7,461
  7,846
  8,248
Maintenance CAPEX, $m
  0
  -1,212
  -1,334
  -1,461
  -1,595
  -1,734
  -1,879
  -2,029
  -2,186
  -2,348
  -2,517
  -2,693
  -2,875
  -3,065
  -3,262
  -3,468
  -3,682
  -3,904
  -4,137
  -4,379
  -4,631
  -4,895
  -5,170
  -5,457
  -5,757
  -6,071
  -6,399
  -6,743
  -7,102
  -7,478
  -7,872
New CAPEX, $m
  -1,492
  -708
  -742
  -774
  -806
  -839
  -873
  -907
  -943
  -980
  -1,018
  -1,059
  -1,101
  -1,145
  -1,191
  -1,240
  -1,292
  -1,346
  -1,404
  -1,464
  -1,528
  -1,595
  -1,667
  -1,741
  -1,821
  -1,904
  -1,992
  -2,084
  -2,182
  -2,284
  -2,393
Cash from investing activities, $m
  -1,359
  -1,920
  -2,076
  -2,235
  -2,401
  -2,573
  -2,752
  -2,936
  -3,129
  -3,328
  -3,535
  -3,752
  -3,976
  -4,210
  -4,453
  -4,708
  -4,974
  -5,250
  -5,541
  -5,843
  -6,159
  -6,490
  -6,837
  -7,198
  -7,578
  -7,975
  -8,391
  -8,827
  -9,284
  -9,762
  -10,265
Free cash flow, $m
  -179
  -248
  -487
  -516
  -545
  -574
  -604
  -636
  -668
  -701
  -736
  -782
  -820
  -860
  -902
  -947
  -996
  -1,047
  -1,101
  -1,158
  -1,217
  -1,280
  -1,346
  -1,416
  -1,489
  -1,566
  -1,648
  -1,733
  -1,823
  -1,917
  -2,017
Issuance/(repayment) of debt, $m
  485
  740
  777
  811
  845
  879
  915
  951
  988
  1,027
  1,067
  1,109
  1,153
  1,200
  1,248
  1,299
  1,354
  1,410
  1,471
  1,534
  1,601
  1,671
  1,746
  1,824
  1,907
  1,995
  2,087
  2,184
  2,286
  2,393
  2,507
Issuance/(repurchase) of shares, $m
  0
  0
  117
  130
  143
  156
  169
  183
  198
  213
  228
  255
  272
  289
  308
  329
  352
  376
  402
  428
  456
  485
  516
  548
  582
  618
  655
  694
  736
  779
  824
Cash from financing (excl. dividends), $m  
  453
  740
  894
  941
  988
  1,035
  1,084
  1,134
  1,186
  1,240
  1,295
  1,364
  1,425
  1,489
  1,556
  1,628
  1,706
  1,786
  1,873
  1,962
  2,057
  2,156
  2,262
  2,372
  2,489
  2,613
  2,742
  2,878
  3,022
  3,172
  3,331
Total cash flow (excl. dividends), $m
  150
  492
  290
  295
  300
  305
  310
  315
  320
  326
  331
  327
  333
  340
  347
  352
  358
  363
  370
  376
  383
  391
  400
  408
  418
  428
  439
  451
  463
  476
  490
Retained Cash Flow (-), $m
  24
  -391
  -408
  -425
  -443
  -461
  -480
  -499
  -518
  -538
  -560
  -582
  -605
  -629
  -655
  -681
  -710
  -740
  -771
  -804
  -839
  -877
  -916
  -957
  -1,000
  -1,046
  -1,094
  -1,145
  -1,199
  -1,255
  -1,314
Prev. year cash balance distribution, $m
 
  1,969
  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
 
  2,070
  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
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
 
  1,985
  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
Current shareholders' claim on cash, %
  100
  100.0
  96.2
  92.5
  88.9
  85.5
  82.2
  79.0
  75.9
  72.9
  70.1
  67.2
  64.5
  61.9
  59.4
  56.9
  54.6
  52.3
  50.2
  48.0
  46.0
  44.1
  42.2
  40.4
  38.6
  36.9
  35.3
  33.7
  32.2
  30.8
  29.4

AU Optronics Corp. researches, develops, produces, and sells thin film transistor liquid crystal displays and other flat panel displays. The company operates through two segments, Display and Solar. The Display segment designs, develops, manufactures, assembles, and markets flat panel displays for use in televisions; desktop monitors; mobile PCs, such as notebooks and tablets; mobile phones; and commercial and other applications, including displays for automobiles, industrial PCs, automated teller machines, point of sale terminals, pachinko machines, and others. It sells its panels to original equipment manufacturing service providers; and brand companies. The Solar segment manufactures upstream and midstream products comprising polysilicon, ingots, and solar wafers and cells; designs, develops, and manufactures solar photovoltaic modules and systems; and provides various value-added services for solar systems projects. This segment sells its ingot and solar wafer products primarily to solar cell manufacturers; and solar modules to installers, solar system integrators, property developers, and other value-added resellers. The company operates in the People’s Republic of China, Japan, Singapore, Malaysia, and internationally. AU Optronics Corp. was founded in 1996 and is headquartered in Hsinchu, Taiwan.

FINANCIAL RATIOS  of  AU Optronics ADR (AUO)

Valuation Ratios
P/E Ratio 153.8
Price to Sales 3.6
Price to Book 6.6
Price to Tangible Book
Price to Cash Flow 32.7
Price to Free Cash Flow -123.7
Growth Rates
Sales Growth Rate -8.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 37.5%
Cap. Spend. - 3 Yr. Gr. Rate 11.3%
Financial Strength
Quick Ratio 4
Current Ratio 0.1
LT Debt to Equity 58.6%
Total Debt to Equity 69.3%
Interest Coverage 6
Management Effectiveness
Return On Assets 2.1%
Ret/ On Assets - 3 Yr. Avg. 2.6%
Return On Total Capital 2.6%
Ret/ On T. Cap. - 3 Yr. Avg. 3.2%
Return On Equity 4.3%
Return On Equity - 3 Yr. Avg. 6.1%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 10.5%
Gross Margin - 3 Yr. Avg. 11.1%
EBITDA Margin 16.1%
EBITDA Margin - 3 Yr. Avg. 17.3%
Operating Margin 3.4%
Oper. Margin - 3 Yr. Avg. 3.3%
Pre-Tax Margin 3.4%
Pre-Tax Margin - 3 Yr. Avg. 3.5%
Net Profit Margin 2.4%
Net Profit Margin - 3 Yr. Avg. 2.6%
Effective Tax Rate 41.1%
Eff/ Tax Rate - 3 Yr. Avg. 31.1%
Payout Ratio 43%

AUO stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the AUO stock intrinsic value calculation we used $10580 million for the last fiscal year's total revenue generated by AU Optronics ADR. The default revenue input number comes from 2016 income statement of AU Optronics 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 AUO stock valuation model: a) initial revenue growth rate of 10.1% 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 AUO is calculated based on our internal credit rating of AU Optronics 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 AU Optronics 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 AUO stock the variable cost ratio is equal to 98.5%.

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 AUO 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 AU Optronics ADR.

Corporate tax rate of 27% is the nominal tax rate for AU Optronics 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 AUO 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 AUO are equal to 66.4%.

Life of production assets of 5.8 years is the average useful life of capital assets used in AU Optronics 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 AUO is equal to -4.6%. 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 - $5827 million for AU Optronics 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 979.058 million for AU Optronics 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 AU Optronics ADR at the current share price and the inputted number of shares is $3.9 billion.


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COMPANY NEWS

▶ AU Optronics posts 1Q profit   [Apr-27-17 05:00AM  Associated Press]
▶ AU Optronics Corp. Files 2016 Annual Report on Form 20-F   [Mar-30-17 08:59AM  PR Newswire]
▶ Top Ranked Momentum Stocks to Buy for March 1st   [Mar-01-17 10:49AM  Zacks]
▶ AU Optronics posts 4Q profit   [Feb-14-17 05:03AM  AP]
▶ JPMorgan Turns Sour On LCD Display   [Feb-12-17 10:57PM  at Barrons.com]
▶ Is AU Optronics Corp (ADR) (AUO) Going to Burn These Hedge Funds?   [Dec-12-16 11:21AM  at Insider Monkey]
▶ AU Optronics reports 2Q loss   [Jul-27-16 05:03AM  AP]
▶ 10 Fresh Analyst Stocks Under $10 With Massive Upside Calls   [Jul-24-16 10:15AM  at 24/7 Wall St.]
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▶ 5 Top Stocks Under $5   [Jun-04-16 09:04AM  at Motley Fool]
▶ AU Optronics Corp. Files 2015 Annual Report on Form 20-F   [Apr-01-16 03:08AM  PR Newswire]
▶ Apple's OLED iPhone Looks More Inevitable by the Day   [Jan-20-16 02:15PM  at Motley Fool]
▶ What Stands Behind These Stocks Bullish Moves Today?   [Dec-21  03:41PM  at Insider Monkey]
▶ Is AU Optronics Corp. (ADR) (AUO) A Good Stock To Buy?   [Nov-27  11:58AM  at Insider Monkey]
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Stock chart of AUO Financial statements of AUO
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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