Intrinsic value of Bitauto Holdings ADR - BITA

Previous Close

$36.95

  Intrinsic Value

$60.64

stock screener

  Rating & Target

str. buy

+64%

  Value-price divergence*

-135%

Previous close

$36.95

 
Intrinsic value

$60.64

 
Up/down potential

+64%

 
Rating

str. buy

 
Value-price divergence*

-135%

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

We calculate the intrinsic value of BITA 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 2.6

 

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, %
  35.77
  35.40
  32.36
  29.62
  27.16
  24.95
  22.95
  21.16
  19.54
  18.09
  16.78
  15.60
  14.54
  13.59
  12.73
  11.95
  11.26
  10.63
  10.07
  9.56
  9.11
  8.70
  8.33
  7.99
  7.69
  7.42
  7.18
  6.96
  6.77
  6.59
  6.43
Revenue, $m
  835
  1,131
  1,496
  1,940
  2,467
  3,082
  3,789
  4,591
  5,488
  6,481
  7,568
  8,748
  10,020
  11,382
  12,830
  14,364
  15,981
  17,681
  19,461
  21,322
  23,264
  25,287
  27,393
  29,582
  31,858
  34,224
  36,682
  39,237
  41,892
  44,653
  47,525
Variable operating expenses, $m
 
  999
  1,321
  1,710
  2,173
  2,713
  3,335
  4,039
  4,827
  5,699
  6,654
  7,684
  8,801
  9,997
  11,269
  12,617
  14,037
  15,530
  17,093
  18,728
  20,434
  22,211
  24,060
  25,983
  27,982
  30,060
  32,219
  34,463
  36,795
  39,220
  41,743
Fixed operating expenses, $m
 
  123
  126
  129
  132
  136
  139
  143
  146
  150
  154
  157
  161
  165
  170
  174
  178
  183
  187
  192
  197
  202
  207
  212
  217
  222
  228
  234
  240
  246
  252
Total operating expenses, $m
  857
  1,122
  1,447
  1,839
  2,305
  2,849
  3,474
  4,182
  4,973
  5,849
  6,808
  7,841
  8,962
  10,162
  11,439
  12,791
  14,215
  15,713
  17,280
  18,920
  20,631
  22,413
  24,267
  26,195
  28,199
  30,282
  32,447
  34,697
  37,035
  39,466
  41,995
Operating income, $m
  -22
  8
  50
  100
  161
  233
  315
  410
  515
  632
  761
  907
  1,058
  1,219
  1,391
  1,574
  1,766
  1,969
  2,181
  2,402
  2,634
  2,875
  3,126
  3,387
  3,659
  3,941
  4,235
  4,540
  4,857
  5,187
  5,530
EBITDA, $m
  78
  61
  118
  187
  270
  367
  479
  606
  749
  907
  1,080
  1,269
  1,473
  1,691
  1,923
  2,168
  2,428
  2,701
  2,986
  3,285
  3,597
  3,922
  4,260
  4,612
  4,978
  5,358
  5,753
  6,164
  6,592
  7,036
  7,498
Interest expense (income), $m
  19
  54
  86
  127
  176
  235
  303
  382
  471
  571
  682
  803
  934
  1,075
  1,227
  1,388
  1,559
  1,739
  1,928
  2,126
  2,333
  2,549
  2,774
  3,008
  3,252
  3,505
  3,768
  4,042
  4,326
  4,621
  4,929
Earnings before tax, $m
  -28
  -45
  -37
  -27
  -15
  -2
  12
  27
  44
  61
  79
  104
  124
  144
  165
  186
  208
  230
  253
  277
  301
  326
  352
  379
  407
  436
  467
  498
  531
  566
  602
Tax expense, $m
  21
  0
  0
  0
  0
  0
  3
  7
  12
  16
  21
  28
  33
  39
  44
  50
  56
  62
  68
  75
  81
  88
  95
  102
  110
  118
  126
  135
  143
  153
  163
Net income, $m
  -78
  -45
  -37
  -27
  -15
  -2
  9
  20
  32
  45
  58
  76
  90
  105
  120
  136
  152
  168
  185
  202
  220
  238
  257
  277
  297
  319
  341
  364
  388
  413
  439

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  293
  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
  4,331
  5,462
  7,229
  9,371
  11,916
  14,889
  18,306
  22,178
  26,512
  31,307
  36,560
  42,263
  48,408
  54,984
  61,982
  69,392
  77,205
  85,415
  94,016
  103,006
  112,387
  122,160
  132,331
  142,909
  153,905
  165,332
  177,207
  189,548
  202,376
  215,715
  229,590
Adjusted assets (=assets-cash), $m
  4,038
  5,462
  7,229
  9,371
  11,916
  14,889
  18,306
  22,178
  26,512
  31,307
  36,560
  42,263
  48,408
  54,984
  61,982
  69,392
  77,205
  85,415
  94,016
  103,006
  112,387
  122,160
  132,331
  142,909
  153,905
  165,332
  177,207
  189,548
  202,376
  215,715
  229,590
Revenue / Adjusted assets
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
  0.207
Average production assets, $m
  346
  468
  620
  803
  1,021
  1,276
  1,569
  1,901
  2,272
  2,683
  3,133
  3,622
  4,148
  4,712
  5,312
  5,947
  6,616
  7,320
  8,057
  8,827
  9,631
  10,469
  11,341
  12,247
  13,189
  14,169
  15,186
  16,244
  17,343
  18,486
  19,675
Working capital, $m
  654
  565
  748
  970
  1,233
  1,541
  1,895
  2,295
  2,744
  3,240
  3,784
  4,374
  5,010
  5,691
  6,415
  7,182
  7,991
  8,840
  9,731
  10,661
  11,632
  12,644
  13,696
  14,791
  15,929
  17,112
  18,341
  19,618
  20,946
  22,327
  23,763
Total debt, $m
  1,824
  2,468
  3,631
  5,040
  6,715
  8,671
  10,919
  13,467
  16,319
  19,474
  22,930
  26,683
  30,726
  35,054
  39,658
  44,534
  49,675
  55,077
  60,736
  66,652
  72,824
  79,255
  85,948
  92,908
  100,144
  107,663
  115,476
  123,597
  132,038
  140,815
  149,944
Total liabilities, $m
  2,950
  3,594
  4,757
  6,166
  7,841
  9,797
  12,045
  14,593
  17,445
  20,600
  24,056
  27,809
  31,852
  36,180
  40,784
  45,660
  50,801
  56,203
  61,862
  67,778
  73,950
  80,381
  87,074
  94,034
  101,270
  108,789
  116,602
  124,723
  133,164
  141,941
  151,070
Total equity, $m
  1,381
  1,868
  2,472
  3,205
  4,075
  5,092
  6,261
  7,585
  9,067
  10,707
  12,503
  14,454
  16,555
  18,805
  21,198
  23,732
  26,404
  29,212
  32,153
  35,228
  38,436
  41,779
  45,257
  48,875
  52,636
  56,544
  60,605
  64,826
  69,213
  73,775
  78,520
Total liabilities and equity, $m
  4,331
  5,462
  7,229
  9,371
  11,916
  14,889
  18,306
  22,178
  26,512
  31,307
  36,559
  42,263
  48,407
  54,985
  61,982
  69,392
  77,205
  85,415
  94,015
  103,006
  112,386
  122,160
  132,331
  142,909
  153,906
  165,333
  177,207
  189,549
  202,377
  215,716
  229,590
Debt-to-equity ratio
  1.321
  1.320
  1.470
  1.570
  1.650
  1.700
  1.740
  1.780
  1.800
  1.820
  1.830
  1.850
  1.860
  1.860
  1.870
  1.880
  1.880
  1.890
  1.890
  1.890
  1.890
  1.900
  1.900
  1.900
  1.900
  1.900
  1.910
  1.910
  1.910
  1.910
  1.910
Adjusted equity ratio
  0.269
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342
  0.342

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -78
  -45
  -37
  -27
  -15
  -2
  9
  20
  32
  45
  58
  76
  90
  105
  120
  136
  152
  168
  185
  202
  220
  238
  257
  277
  297
  319
  341
  364
  388
  413
  439
Depreciation, amort., depletion, $m
  100
  53
  68
  87
  109
  134
  163
  196
  234
  275
  320
  362
  415
  471
  531
  595
  662
  732
  806
  883
  963
  1,047
  1,134
  1,225
  1,319
  1,417
  1,519
  1,624
  1,734
  1,849
  1,968
Funds from operations, $m
  72
  8
  32
  60
  93
  132
  172
  216
  266
  319
  377
  438
  505
  576
  651
  730
  813
  900
  990
  1,085
  1,183
  1,285
  1,391
  1,502
  1,616
  1,735
  1,859
  1,988
  2,122
  2,262
  2,407
Change in working capital, $m
  -4
  148
  183
  222
  263
  308
  354
  401
  449
  496
  544
  590
  636
  681
  724
  767
  809
  850
  890
  931
  971
  1,012
  1,053
  1,095
  1,138
  1,183
  1,229
  1,277
  1,328
  1,381
  1,436
Cash from operations, $m
  76
  -140
  -151
  -162
  -170
  -176
  -182
  -184
  -183
  -177
  -166
  -152
  -131
  -104
  -73
  -37
  5
  50
  100
  154
  212
  273
  338
  407
  478
  553
  630
  711
  794
  881
  971
Maintenance CAPEX, $m
  0
  -35
  -47
  -62
  -80
  -102
  -128
  -157
  -190
  -227
  -268
  -313
  -362
  -415
  -471
  -531
  -595
  -662
  -732
  -806
  -883
  -963
  -1,047
  -1,134
  -1,225
  -1,319
  -1,417
  -1,519
  -1,624
  -1,734
  -1,849
New CAPEX, $m
  -88
  -122
  -151
  -184
  -218
  -255
  -293
  -332
  -371
  -411
  -450
  -489
  -527
  -564
  -600
  -635
  -670
  -704
  -737
  -770
  -804
  -838
  -872
  -907
  -942
  -979
  -1,018
  -1,058
  -1,099
  -1,143
  -1,189
Cash from investing activities, $m
  -2,455
  -157
  -198
  -246
  -298
  -357
  -421
  -489
  -561
  -638
  -718
  -802
  -889
  -979
  -1,071
  -1,166
  -1,265
  -1,366
  -1,469
  -1,576
  -1,687
  -1,801
  -1,919
  -2,041
  -2,167
  -2,298
  -2,435
  -2,577
  -2,723
  -2,877
  -3,038
Free cash flow, $m
  -2,379
  -297
  -350
  -407
  -469
  -533
  -602
  -673
  -744
  -815
  -885
  -954
  -1,020
  -1,083
  -1,144
  -1,203
  -1,260
  -1,315
  -1,369
  -1,422
  -1,475
  -1,527
  -1,580
  -1,634
  -1,689
  -1,746
  -1,804
  -1,865
  -1,929
  -1,996
  -2,067
Issuance/(repayment) of debt, $m
  1,791
  937
  1,163
  1,409
  1,675
  1,956
  2,248
  2,548
  2,852
  3,155
  3,456
  3,753
  4,043
  4,327
  4,605
  4,876
  5,141
  5,402
  5,660
  5,916
  6,172
  6,431
  6,693
  6,960
  7,235
  7,519
  7,814
  8,120
  8,441
  8,777
  9,129
Issuance/(repurchase) of shares, $m
  440
  532
  641
  759
  886
  1,019
  1,160
  1,305
  1,450
  1,595
  1,739
  1,874
  2,011
  2,144
  2,273
  2,399
  2,521
  2,640
  2,757
  2,873
  2,988
  3,104
  3,222
  3,341
  3,463
  3,590
  3,721
  3,857
  3,999
  4,149
  4,306
Cash from financing (excl. dividends), $m  
  2,231
  1,469
  1,804
  2,168
  2,561
  2,975
  3,408
  3,853
  4,302
  4,750
  5,195
  5,627
  6,054
  6,471
  6,878
  7,275
  7,662
  8,042
  8,417
  8,789
  9,160
  9,535
  9,915
  10,301
  10,698
  11,109
  11,535
  11,977
  12,440
  12,926
  13,435
Total cash flow (excl. dividends), $m
  -133
  1,173
  1,455
  1,761
  2,092
  2,442
  2,806
  3,180
  3,557
  3,935
  4,310
  4,673
  5,035
  5,389
  5,734
  6,071
  6,402
  6,727
  7,048
  7,367
  7,686
  8,008
  8,334
  8,667
  9,010
  9,363
  9,730
  10,112
  10,511
  10,929
  11,368
Retained Cash Flow (-), $m
  -172
  -532
  -641
  -759
  -886
  -1,019
  -1,169
  -1,324
  -1,482
  -1,640
  -1,796
  -1,951
  -2,102
  -2,249
  -2,393
  -2,534
  -2,672
  -2,808
  -2,942
  -3,075
  -3,208
  -3,342
  -3,479
  -3,618
  -3,761
  -3,908
  -4,061
  -4,221
  -4,387
  -4,562
  -4,745
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
 
  640
  813
  1,002
  1,206
  1,423
  1,638
  1,855
  2,075
  2,295
  2,514
  2,723
  2,933
  3,139
  3,341
  3,537
  3,730
  3,919
  4,106
  4,292
  4,478
  4,665
  4,856
  5,050
  5,249
  5,455
  5,669
  5,891
  6,124
  6,367
  6,623
Discount rate, %
 
  9.10
  9.56
  10.03
  10.53
  11.06
  11.61
  12.19
  12.80
  13.44
  14.12
  14.82
  15.56
  16.34
  17.16
  18.02
  18.92
  19.86
  20.86
  21.90
  23.00
  24.15
  25.35
  26.62
  27.95
  29.35
  30.82
  32.36
  33.97
  35.67
  37.46
PV of cash for distribution, $m
 
  587
  678
  752
  808
  842
  847
  829
  791
  738
  671
  595
  517
  439
  364
  295
  233
  180
  136
  100
  71
  50
  34
  22
  14
  9
  5
  3
  2
  1
  0
Current shareholders' claim on cash, %
  100
  82.9
  70.0
  60.1
  52.3
  46.1
  41.1
  37.0
  33.5
  30.6
  28.2
  26.1
  24.3
  22.7
  21.3
  20.1
  19.0
  18.0
  17.2
  16.4
  15.7
  15.0
  14.4
  13.9
  13.4
  12.9
  12.4
  12.0
  11.7
  11.3
  10.9

Bitauto Holdings Limited provides Internet content and marketing services for the automotive industry in the People’s Republic of China. The company operates in three segments: Advertising Business, EP Platform Business, and Digital Marketing Solutions Business. The Advertising Business segment provides advertising services, including new automobile pricing and promotional information, specifications, reviews, and consumer feedback to automakers through its bitauto.com and taoche.com Websites, as well as mobile applications. The EP Platform Business segment provides Web-based and mobile-based integrated digital marketing, customer relationship management (CRM), and automobile listing services to automobile customers in China. This segment’s platform enables dealer subscribers to create their own online showrooms, list pricing and promotional information, provide dealer contact information, place advertisements, and manage customer relationships. It also provides automobile transaction, CRM, and online automotive financial platform services to automobile customers. The Digital Marketing Solutions Business segment provides one-stop digital marketing solutions, such as Website creation and maintenance, online public relations, online marketing campaigns, and advertising agent services to automakers. The company also distributes its dealer customers' automobile pricing and promotional information through its partners who provides Internet services. In addition, it provides customer services and training to dealer customers. Bitauto Holdings Limited was founded in 2000 and is headquartered in Beijing, the People’s Republic of China.

FINANCIAL RATIOS  of  Bitauto Holdings ADR (BITA)

Valuation Ratios
P/E Ratio -32.9
Price to Sales 3.1
Price to Book 1.9
Price to Tangible Book
Price to Cash Flow 33.8
Price to Free Cash Flow -213.8
Growth Rates
Sales Growth Rate 35.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 158.8%
Cap. Spend. - 3 Yr. Gr. Rate 77.5%
Financial Strength
Quick Ratio 0
Current Ratio 0.5
LT Debt to Equity 42.7%
Total Debt to Equity 132.1%
Interest Coverage 0
Management Effectiveness
Return On Assets -1.4%
Ret/ On Assets - 3 Yr. Avg. 3.9%
Return On Total Capital -3.5%
Ret/ On T. Cap. - 3 Yr. Avg. 4.8%
Return On Equity -6%
Return On Equity - 3 Yr. Avg. 3.9%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 64.1%
Gross Margin - 3 Yr. Avg. 68.2%
EBITDA Margin 10.9%
EBITDA Margin - 3 Yr. Avg. 15%
Operating Margin -2.6%
Oper. Margin - 3 Yr. Avg. 4%
Pre-Tax Margin -3.4%
Pre-Tax Margin - 3 Yr. Avg. 3.9%
Net Profit Margin -9.3%
Net Profit Margin - 3 Yr. Avg. -0.9%
Effective Tax Rate -75%
Eff/ Tax Rate - 3 Yr. Avg. -26.8%
Payout Ratio 0%

BITA stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BITA stock intrinsic value calculation we used $835 million for the last fiscal year's total revenue generated by Bitauto Holdings ADR. The default revenue input number comes from 2016 income statement of Bitauto Holdings 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 BITA stock valuation model: a) initial revenue growth rate of 35.4% 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 9.1%, whose default value for BITA is calculated based on our internal credit rating of Bitauto Holdings 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 Bitauto Holdings 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 BITA stock the variable cost ratio is equal to 88.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $120 million in the base year in the intrinsic value calculation for BITA 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 Bitauto Holdings ADR.

Corporate tax rate of 27% is the nominal tax rate for Bitauto Holdings 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 BITA 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 BITA are equal to 41.4%.

Life of production assets of 10 years is the average useful life of capital assets used in Bitauto Holdings 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 BITA is equal to 50%. 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 - $1381 million for Bitauto Holdings 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 69.636 million for Bitauto Holdings 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 Bitauto Holdings ADR at the current share price and the inputted number of shares is $2.6 billion.

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COMPANY NEWS

▶ Bitauto Holdngs reports 2Q loss   [Aug-15-17 10:18PM  Associated Press]
▶ BitAuto Beats Expectations But Stock Slips   [06:25AM  Investor's Business Daily]
▶ These Hot China-Based Stocks Are Trading At Or Near New All-Time Highs   [Aug-07-17 11:22AM  Investor's Business Daily]
▶ Best Chinese Stocks To Buy And Watch   [Jun-20-17 04:41PM  Investor's Business Daily]
▶ Which Stocks Are Showing Rising Relative Strength?   [04:27PM  Investor's Business Daily]
▶ 3 Stocks Wall Street Hasn't Noticed   [Jun-17-17 07:32AM  Motley Fool]
▶ 3 Mid-Cap Stocks for June   [Jun-15-17 09:04AM  Motley Fool]
▶ My Top Stock to Buy in June   [Jun-03-17 10:49AM  Motley Fool]
▶ IPO Stock News And Analysis: Find Today's Top New Issues   [04:27PM  Investor's Business Daily]
▶ Earnings Calendar, Analyst Estimates And Stocks To Watch   [09:05AM  Investor's Business Daily]
▶ Bitauto Holdngs reports 1Q loss   [07:16AM  Associated Press]
▶ Forget Snap's Bust, Watch These Tech Unicorns: Investing Action Plan   [May-10-17 05:07PM  Investor's Business Daily]
▶ ETFs with exposure to Bitauto Holdings Ltd. : May 3, 2017   [May-03-17 03:40PM  Capital Cube]
▶ 5 Consumer Service Stocks to Buy in 2017   [May-01-17 05:36PM  Motley Fool]
▶ Bitauto Files Annual Report on Form 20-F   [06:00AM  PR Newswire]
▶ Bitauto Raises $1 Billion from Tencent, JD.com and Baidu   [Apr-21-17 12:29AM  Barrons.com]
▶ Can Bitauto Keep Going After Last Week's 13% Pop?   [Mar-13-17 10:00AM  Motley Fool]
▶ Can Bitauto Keep Going After Last Week's 13% Pop?   [Mar-06-17 09:07AM  at Motley Fool]
▶ Bitauto Holdngs reports 4Q loss   [07:03AM  Associated Press]
▶ Is Bitauto Hldg Ltd (ADR) (BITA) Going to Reward Investors?   [Dec-08-16 03:12PM  Insider Monkey]
▶ This Fast-Rising China-Based Tech Stock Is a Must Buy   [Sep-29-16 12:58PM  at TheStreet]
▶ These 3 Stocks Are Surprisingly Cheap   [Sep-26-16 04:16PM  at Motley Fool]
▶ Why I Just Bought This Chinese Growth Company   [Jul-02-16 08:06AM  at Motley Fool]
▶ Can Bitauto Keep Going After Last Week's 10% Pop?   [Jun-13-16 10:13AM  at Motley Fool]
▶ What Happened in the Stock Market Today   [Jun-06-16 05:38PM  at Motley Fool]
▶ Why Bitauto Stock Popped Today   [01:20PM  at Motley Fool]
▶ Why Are Traders Piling Into These Stocks?   [12:07PM  at Insider Monkey]
Stock chart of BITA Financial statements of BITA
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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