Intrinsic value of Broadridge Financial Solutions - BR

Previous Close

$89.48

  Intrinsic Value

$556.37

stock screener

  Rating & Target

str. buy

+522%

Previous close

$89.48

 
Intrinsic value

$556.37

 
Up/down potential

+522%

 
Rating

str. buy

We calculate the intrinsic value of BR 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 2017), $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 10.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2017(a)
   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
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  43.01
  38.10
  34.79
  31.81
  29.13
  26.72
  24.55
  22.59
  20.83
  19.25
  17.82
  16.54
  15.39
  14.35
  13.41
  12.57
  11.81
  11.13
  10.52
  9.97
  9.47
  9.02
  8.62
  8.26
  7.93
  7.64
  7.38
  7.14
  6.92
  6.73
  6.56
Revenue, $m
  4,143
  5,721
  7,712
  10,165
  13,126
  16,633
  20,716
  25,396
  30,686
  36,593
  43,115
  50,247
  57,978
  66,297
  75,190
  84,643
  94,644
  105,181
  116,246
  127,834
  139,942
  152,570
  165,724
  179,413
  193,647
  208,442
  223,817
  239,794
  256,399
  273,661
  291,611
Variable operating expenses, $m
 
  4,688
  6,278
  8,238
  10,604
  13,406
  16,669
  20,408
  24,635
  29,355
  34,566
  40,149
  46,326
  52,973
  60,079
  67,632
  75,623
  84,042
  92,884
  102,143
  111,817
  121,907
  132,418
  143,355
  154,728
  166,550
  178,835
  191,602
  204,870
  218,662
  233,004
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
  3,611
  4,688
  6,278
  8,238
  10,604
  13,406
  16,669
  20,408
  24,635
  29,355
  34,566
  40,149
  46,326
  52,973
  60,079
  67,632
  75,623
  84,042
  92,884
  102,143
  111,817
  121,907
  132,418
  143,355
  154,728
  166,550
  178,835
  191,602
  204,870
  218,662
  233,004
Operating income, $m
  532
  1,034
  1,434
  1,927
  2,522
  3,227
  4,048
  4,988
  6,051
  7,238
  8,549
  10,098
  11,652
  13,324
  15,111
  17,011
  19,021
  21,139
  23,363
  25,691
  28,125
  30,663
  33,306
  36,057
  38,918
  41,892
  44,982
  48,193
  51,530
  54,999
  58,606
EBITDA, $m
  706
  1,220
  1,645
  2,168
  2,799
  3,547
  4,418
  5,416
  6,544
  7,803
  9,194
  10,715
  12,364
  14,138
  16,034
  18,050
  20,183
  22,430
  24,789
  27,260
  29,842
  32,535
  35,340
  38,259
  41,295
  44,450
  47,728
  51,136
  54,677
  58,358
  62,185
Interest expense (income), $m
  43
  45
  79
  121
  173
  236
  310
  397
  496
  609
  734
  872
  1,024
  1,188
  1,364
  1,553
  1,754
  1,966
  2,190
  2,425
  2,671
  2,928
  3,196
  3,475
  3,766
  4,068
  4,382
  4,708
  5,047
  5,400
  5,766
Earnings before tax, $m
  488
  989
  1,355
  1,806
  2,349
  2,991
  3,737
  4,591
  5,555
  6,630
  7,815
  9,226
  10,628
  12,136
  13,747
  15,458
  17,267
  19,173
  21,173
  23,267
  25,454
  27,735
  30,111
  32,582
  35,153
  37,824
  40,600
  43,485
  46,483
  49,599
  52,840
Tax expense, $m
  161
  267
  366
  488
  634
  808
  1,009
  1,240
  1,500
  1,790
  2,110
  2,491
  2,870
  3,277
  3,712
  4,174
  4,662
  5,177
  5,717
  6,282
  6,873
  7,488
  8,130
  8,797
  9,491
  10,212
  10,962
  11,741
  12,550
  13,392
  14,267
Net income, $m
  327
  722
  989
  1,319
  1,715
  2,184
  2,728
  3,352
  4,055
  4,840
  5,705
  6,735
  7,759
  8,859
  10,035
  11,284
  12,605
  13,996
  15,456
  16,985
  18,581
  20,247
  21,981
  23,785
  25,661
  27,611
  29,638
  31,744
  33,932
  36,207
  38,573

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  271
  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
  3,150
  3,976
  5,359
  7,064
  9,122
  11,559
  14,396
  17,648
  21,325
  25,429
  29,962
  34,918
  40,291
  46,072
  52,252
  58,821
  65,771
  73,093
  80,783
  88,835
  97,249
  106,025
  115,166
  124,679
  134,570
  144,852
  155,536
  166,640
  178,179
  190,174
  202,648
Adjusted assets (=assets-cash), $m
  2,879
  3,976
  5,359
  7,064
  9,122
  11,559
  14,396
  17,648
  21,325
  25,429
  29,962
  34,918
  40,291
  46,072
  52,252
  58,821
  65,771
  73,093
  80,783
  88,835
  97,249
  106,025
  115,166
  124,679
  134,570
  144,852
  155,536
  166,640
  178,179
  190,174
  202,648
Revenue / Adjusted assets
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
  1.439
Average production assets, $m
  447
  618
  833
  1,098
  1,418
  1,796
  2,237
  2,743
  3,314
  3,952
  4,656
  5,427
  6,262
  7,160
  8,121
  9,141
  10,222
  11,360
  12,555
  13,806
  15,114
  16,478
  17,898
  19,377
  20,914
  22,512
  24,172
  25,898
  27,691
  29,555
  31,494
Working capital, $m
  245
  -34
  -46
  -61
  -79
  -100
  -124
  -152
  -184
  -220
  -259
  -301
  -348
  -398
  -451
  -508
  -568
  -631
  -697
  -767
  -840
  -915
  -994
  -1,076
  -1,162
  -1,251
  -1,343
  -1,439
  -1,538
  -1,642
  -1,750
Total debt, $m
  1,102
  1,918
  2,949
  4,219
  5,752
  7,567
  9,681
  12,104
  14,843
  17,901
  21,278
  24,970
  28,973
  33,280
  37,884
  42,778
  47,955
  53,410
  59,139
  65,138
  71,407
  77,945
  84,755
  91,842
  99,211
  106,871
  114,831
  123,102
  131,699
  140,636
  149,929
Total liabilities, $m
  2,146
  2,962
  3,993
  5,263
  6,796
  8,611
  10,725
  13,148
  15,887
  18,945
  22,322
  26,014
  30,017
  34,324
  38,928
  43,822
  48,999
  54,454
  60,183
  66,182
  72,451
  78,989
  85,799
  92,886
  100,255
  107,915
  115,875
  124,146
  132,743
  141,680
  150,973
Total equity, $m
  1,004
  1,014
  1,367
  1,801
  2,326
  2,948
  3,671
  4,500
  5,438
  6,485
  7,640
  8,904
  10,274
  11,748
  13,324
  14,999
  16,772
  18,639
  20,600
  22,653
  24,799
  27,036
  29,367
  31,793
  34,315
  36,937
  39,662
  42,493
  45,436
  48,494
  51,675
Total liabilities and equity, $m
  3,150
  3,976
  5,360
  7,064
  9,122
  11,559
  14,396
  17,648
  21,325
  25,430
  29,962
  34,918
  40,291
  46,072
  52,252
  58,821
  65,771
  73,093
  80,783
  88,835
  97,250
  106,025
  115,166
  124,679
  134,570
  144,852
  155,537
  166,639
  178,179
  190,174
  202,648
Debt-to-equity ratio
  1.098
  1.890
  2.160
  2.340
  2.470
  2.570
  2.640
  2.690
  2.730
  2.760
  2.780
  2.800
  2.820
  2.830
  2.840
  2.850
  2.860
  2.870
  2.870
  2.880
  2.880
  2.880
  2.890
  2.890
  2.890
  2.890
  2.900
  2.900
  2.900
  2.900
  2.900
Adjusted equity ratio
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255
  0.255

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  327
  722
  989
  1,319
  1,715
  2,184
  2,728
  3,352
  4,055
  4,840
  5,705
  6,735
  7,759
  8,859
  10,035
  11,284
  12,605
  13,996
  15,456
  16,985
  18,581
  20,247
  21,981
  23,785
  25,661
  27,611
  29,638
  31,744
  33,932
  36,207
  38,573
Depreciation, amort., depletion, $m
  174
  186
  211
  241
  277
  320
  370
  428
  493
  565
  645
  617
  712
  814
  923
  1,039
  1,162
  1,291
  1,427
  1,569
  1,717
  1,872
  2,034
  2,202
  2,377
  2,558
  2,747
  2,943
  3,147
  3,359
  3,579
Funds from operations, $m
  541
  908
  1,200
  1,559
  1,992
  2,504
  3,098
  3,779
  4,548
  5,405
  6,350
  7,352
  8,470
  9,673
  10,958
  12,323
  13,767
  15,287
  16,883
  18,554
  20,299
  22,119
  24,015
  25,987
  28,038
  30,170
  32,385
  34,687
  37,079
  39,566
  42,152
Change in working capital, $m
  25
  -9
  -12
  -15
  -18
  -21
  -24
  -28
  -32
  -35
  -39
  -43
  -46
  -50
  -53
  -57
  -60
  -63
  -66
  -70
  -73
  -76
  -79
  -82
  -85
  -89
  -92
  -96
  -100
  -104
  -108
Cash from operations, $m
  516
  917
  1,212
  1,574
  2,010
  2,525
  3,123
  3,807
  4,579
  5,440
  6,389
  7,394
  8,517
  9,723
  11,011
  12,380
  13,827
  15,350
  16,949
  18,623
  20,372
  22,195
  24,094
  26,069
  28,123
  30,258
  32,477
  34,783
  37,179
  39,670
  42,260
Maintenance CAPEX, $m
  0
  -51
  -70
  -95
  -125
  -161
  -204
  -254
  -312
  -377
  -449
  -529
  -617
  -712
  -814
  -923
  -1,039
  -1,162
  -1,291
  -1,427
  -1,569
  -1,717
  -1,872
  -2,034
  -2,202
  -2,377
  -2,558
  -2,747
  -2,943
  -3,147
  -3,359
New CAPEX, $m
  -204
  -171
  -215
  -265
  -320
  -379
  -441
  -505
  -571
  -638
  -704
  -770
  -835
  -898
  -960
  -1,021
  -1,080
  -1,138
  -1,195
  -1,251
  -1,308
  -1,364
  -1,421
  -1,478
  -1,537
  -1,598
  -1,661
  -1,726
  -1,793
  -1,864
  -1,939
Cash from investing activities, $m
  -659
  -222
  -285
  -360
  -445
  -540
  -645
  -759
  -883
  -1,015
  -1,153
  -1,299
  -1,452
  -1,610
  -1,774
  -1,944
  -2,119
  -2,300
  -2,486
  -2,678
  -2,877
  -3,081
  -3,293
  -3,512
  -3,739
  -3,975
  -4,219
  -4,473
  -4,736
  -5,011
  -5,298
Free cash flow, $m
  -143
  696
  927
  1,214
  1,565
  1,985
  2,478
  3,048
  3,696
  4,426
  5,236
  6,095
  7,065
  8,113
  9,237
  10,436
  11,708
  13,051
  14,463
  15,945
  17,495
  19,113
  20,801
  22,557
  24,384
  26,284
  28,258
  30,310
  32,442
  34,659
  36,963
Issuance/(repayment) of debt, $m
  85
  816
  1,031
  1,270
  1,533
  1,816
  2,114
  2,423
  2,739
  3,058
  3,377
  3,692
  4,003
  4,307
  4,604
  4,894
  5,178
  5,455
  5,729
  5,999
  6,268
  6,538
  6,810
  7,087
  7,369
  7,660
  7,960
  8,272
  8,597
  8,937
  9,293
Issuance/(repurchase) of shares, $m
  -282
  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  
  -160
  816
  1,031
  1,270
  1,533
  1,816
  2,114
  2,423
  2,739
  3,058
  3,377
  3,692
  4,003
  4,307
  4,604
  4,894
  5,178
  5,455
  5,729
  5,999
  6,268
  6,538
  6,810
  7,087
  7,369
  7,660
  7,960
  8,272
  8,597
  8,937
  9,293
Total cash flow (excl. dividends), $m
  -305
  1,512
  1,957
  2,484
  3,098
  3,800
  4,591
  5,470
  6,435
  7,484
  8,612
  9,787
  11,068
  12,420
  13,841
  15,330
  16,885
  18,506
  20,192
  21,944
  23,763
  25,652
  27,611
  29,644
  31,753
  33,944
  36,218
  38,582
  41,039
  43,595
  46,256
Retained Cash Flow (-), $m
  42
  -281
  -353
  -435
  -525
  -621
  -723
  -829
  -937
  -1,047
  -1,156
  -1,264
  -1,370
  -1,474
  -1,576
  -1,675
  -1,772
  -1,867
  -1,961
  -2,053
  -2,146
  -2,238
  -2,331
  -2,426
  -2,522
  -2,622
  -2,725
  -2,831
  -2,943
  -3,059
  -3,181
Prev. year cash balance distribution, $m
 
  271
  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
 
  1,502
  1,605
  2,050
  2,573
  3,179
  3,868
  4,641
  5,498
  6,437
  7,457
  8,524
  9,698
  10,946
  12,265
  13,655
  15,113
  16,639
  18,231
  19,891
  21,618
  23,414
  25,280
  27,218
  29,231
  31,322
  33,494
  35,751
  38,097
  40,536
  43,075
Discount rate, %
 
  4.90
  5.15
  5.40
  5.67
  5.96
  6.25
  6.57
  6.89
  7.24
  7.60
  7.98
  8.38
  8.80
  9.24
  9.70
  10.19
  10.70
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.05
  15.80
  16.59
  17.42
  18.29
  19.21
  20.17
PV of cash for distribution, $m
 
  1,432
  1,451
  1,750
  2,064
  2,380
  2,688
  2,974
  3,225
  3,432
  3,584
  3,662
  3,692
  3,657
  3,559
  3,405
  3,201
  2,957
  2,684
  2,392
  2,094
  1,798
  1,514
  1,250
  1,010
  800
  619
  468
  345
  248
  174
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

Broadridge Financial Solutions, Inc. (Broadridge) is a provider of investor communications and technology-driven solutions to banks, broker-dealers, mutual funds and corporate issuers. The Company's segments include Investor Communication Solutions, and Global Technology and Operations. The Company offers Bank/Broker-Dealer Investor Communication Solutions, Customer Communication Solutions, Corporate Issuer Solutions, Advisor Solutions and Mutual Fund and Retirement Solutions through Investor Communication Solutions segment. The Company offers a middle- and back-office securities processing platform for North American and global broker-dealers. Its services include investor and customer communications, securities processing, and data and analytics solutions. The Company delivers a range of solutions that helps its clients serve their retail and institutional customers across the entire investment lifecycle, including pre-trade, trade, and post-trade processing functionality.

FINANCIAL RATIOS  of  Broadridge Financial Solutions (BR)

Valuation Ratios
P/E Ratio 31.9
Price to Sales 2.5
Price to Book 10.4
Price to Tangible Book
Price to Cash Flow 20.2
Price to Free Cash Flow 33.4
Growth Rates
Sales Growth Rate 43%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 168.4%
Cap. Spend. - 3 Yr. Gr. Rate 30.9%
Financial Strength
Quick Ratio NaN
Current Ratio 0.2
LT Debt to Equity 109.8%
Total Debt to Equity 109.8%
Interest Coverage 12
Management Effectiveness
Return On Assets 11.8%
Ret/ On Assets - 3 Yr. Avg. 12.5%
Return On Total Capital 15.7%
Ret/ On T. Cap. - 3 Yr. Avg. 17%
Return On Equity 31.9%
Return On Equity - 3 Yr. Avg. 31.2%
Asset Turnover 1.4
Profitability Ratios
Gross Margin 24.9%
Gross Margin - 3 Yr. Avg. 29.6%
EBITDA Margin 17%
EBITDA Margin - 3 Yr. Avg. 19%
Operating Margin 12.8%
Oper. Margin - 3 Yr. Avg. 15.8%
Pre-Tax Margin 11.8%
Pre-Tax Margin - 3 Yr. Avg. 14.8%
Net Profit Margin 7.9%
Net Profit Margin - 3 Yr. Avg. 9.7%
Effective Tax Rate 33%
Eff/ Tax Rate - 3 Yr. Avg. 34%
Payout Ratio 46.5%

BR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BR stock intrinsic value calculation we used $4143 million for the last fiscal year's total revenue generated by Broadridge Financial Solutions. The default revenue input number comes from 2017 income statement of Broadridge Financial Solutions. 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 BR stock valuation model: a) initial revenue growth rate of 38.1% 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 4.9%, whose default value for BR is calculated based on our internal credit rating of Broadridge Financial Solutions, 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 Broadridge Financial Solutions.
    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 BR stock the variable cost ratio is equal to 82.7%.

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 BR 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 4.1% for Broadridge Financial Solutions.

Corporate tax rate of 27% is the nominal tax rate for Broadridge Financial Solutions. 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 BR 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 BR are equal to 10.8%.

Life of production assets of 8.8 years is the average useful life of capital assets used in Broadridge Financial Solutions 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 BR is equal to -0.6%. 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 - $1004 million for Broadridge Financial Solutions - 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 116.524 million for Broadridge Financial Solutions 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 Broadridge Financial Solutions at the current share price and the inputted number of shares is $10.4 billion.

RELATED COMPANIES Price Int.Val. Rating
INOD Innodata 1.08 0.30  str.sell
CLGX CoreLogic 45.30 37.51  sell
EXLS ExlService Hol 60.97 38.56  sell
AXR Amrep 7.00 2.63  str.sell
IBM International 153.91 173.22  hold
EFX Equifax 117.40 80.96  sell
INTU Intuit 156.48 127.46  hold
CBZ CBIZ Inc 14.90 23.18  buy

COMPANY NEWS

▶ Top 3 Growth Stocks for 2017   [Dec-07-17 05:55PM  Investopedia]
▶ Broadridge Declares Quarterly Dividend of $0.365 per Share   [Nov-16-17 12:45PM  GlobeNewswire]
▶ Top 3 Growth Stocks for 2017   [Nov-08-17 10:45AM  Investopedia]
▶ Broadridge Financial tops 1Q profit forecasts   [08:55AM  Associated Press]
▶ 3 Dividend Stocks Ideal for Your Golden Years   [Oct-22-17 06:00AM  Motley Fool]
▶ Retail Shares Matter Against Activism, Says Daly   [Oct-11-17 10:47AM  Bloomberg Video]
▶ Broadridge Financial Solutions Earns Composite Rating Upgrade   [Oct-10-17 03:00AM  Investor's Business Daily]
▶ New Strong Buy Stocks for October 4th   [Oct-04-17 09:52AM  Zacks]
▶ Stocks With Rising Relative Strength: Broadridge Financial Solutions   [Sep-06-17 03:00AM  Investor's Business Daily]
▶ Outsourcing Picks: Better Digital Ops, and Fast   [Aug-29-17 03:54PM  Zacks]
▶ New Strong Buy Stocks for August 25th   [Aug-25-17 11:39AM  Zacks]
▶ New Strong Buy Stocks for August 22nd   [Aug-22-17 10:21AM  Zacks]
▶ Top Ranked Growth Stocks to Buy for August 17th   [Aug-17-17 09:42AM  Zacks]
▶ Broadridge Financial meets 4Q profit forecasts   [Aug-10-17 11:51PM  Associated Press]
▶ Broadridge Financial meets 4Q profit forecasts   [07:26AM  Associated Press]
▶ Broadridge Appoints Tim Gokey President   [04:30PM  GlobeNewswire]
▶ Bigger Fund Flows Stem From Low-Fee Funds and ETF's   [Aug-01-17 04:01PM  TheStreet.com]
▶ 7 Near-Monopolies That Are Perfectly Legal in America   [Jul-21-17 07:15AM  Motley Fool]
▶ 3 Growth Stocks for Conservative Investors   [Jun-26-17 10:51AM  Motley Fool]
Financial statements of BR
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.

FREE DOWNLOAD
Follow us on:   twitter   twitter   twitter   twitter

VALUATION THEORY       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2017. All rigths reserved.