Intrinsic value of Bear State Financial - BSF

Previous Close

$10.32

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$10.32

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

Our model is not good at valuating stocks of financial companies, such as BSF.

We calculate the intrinsic value of BSF 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

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

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, %
  -100.00
  8.70
  8.33
  8.00
  7.70
  7.43
  7.18
  6.97
  6.77
  6.59
  6.43
  6.29
  6.16
  6.04
  5.94
  5.85
  5.76
  5.69
  5.62
  5.56
  5.50
  5.45
  5.40
  5.36
  5.33
  5.30
  5.27
  5.24
  5.22
  5.19
  5.17
Revenue, $m
  0
  97
  105
  113
  122
  131
  140
  150
  160
  171
  182
  193
  205
  218
  231
  244
  258
  273
  288
  304
  321
  338
  357
  376
  396
  417
  439
  462
  486
  511
  537
Variable operating expenses, $m
 
  68
  73
  79
  85
  92
  98
  105
  112
  119
  127
  135
  143
  152
  161
  171
  180
  191
  201
  213
  224
  236
  249
  263
  277
  291
  307
  323
  339
  357
  376
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
  0
  68
  73
  79
  85
  92
  98
  105
  112
  119
  127
  135
  143
  152
  161
  171
  180
  191
  201
  213
  224
  236
  249
  263
  277
  291
  307
  323
  339
  357
  376
Operating income, $m
  0
  29
  32
  34
  37
  39
  42
  45
  48
  51
  55
  58
  62
  66
  69
  73
  78
  82
  87
  92
  97
  102
  107
  113
  119
  125
  132
  139
  146
  154
  162
EBITDA, $m
  5
  259
  280
  303
  326
  350
  375
  402
  429
  457
  486
  517
  549
  582
  617
  653
  690
  730
  771
  813
  858
  905
  954
  1,005
  1,058
  1,115
  1,173
  1,235
  1,299
  1,367
  1,437
Interest expense (income), $m
  8
  107
  106
  112
  119
  127
  134
  142
  150
  158
  167
  176
  185
  195
  205
  216
  227
  239
  251
  263
  277
  290
  305
  320
  336
  352
  369
  387
  406
  426
  447
Earnings before tax, $m
  24
  -78
  -74
  -78
  -83
  -87
  -92
  -97
  -102
  -107
  -112
  -118
  -124
  -130
  -136
  -143
  -149
  -157
  -164
  -172
  -180
  -189
  -197
  -207
  -216
  -227
  -237
  -248
  -260
  -272
  -285
Tax expense, $m
  7
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  17
  -78
  -74
  -78
  -83
  -87
  -92
  -97
  -102
  -107
  -112
  -118
  -124
  -130
  -136
  -143
  -149
  -157
  -164
  -172
  -180
  -189
  -197
  -207
  -216
  -227
  -237
  -248
  -260
  -272
  -285

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  2,053
  1,640
  1,776
  1,918
  2,066
  2,219
  2,379
  2,545
  2,717
  2,896
  3,082
  3,276
  3,478
  3,688
  3,907
  4,136
  4,374
  4,623
  4,883
  5,154
  5,437
  5,734
  6,043
  6,368
  6,707
  7,062
  7,434
  7,823
  8,231
  8,659
  9,107
Adjusted assets (=assets-cash), $m
  2,053
  1,640
  1,776
  1,918
  2,066
  2,219
  2,379
  2,545
  2,717
  2,896
  3,082
  3,276
  3,478
  3,688
  3,907
  4,136
  4,374
  4,623
  4,883
  5,154
  5,437
  5,734
  6,043
  6,368
  6,707
  7,062
  7,434
  7,823
  8,231
  8,659
  9,107
Revenue / Adjusted assets
  0.000
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
  0.059
Average production assets, $m
  70
  2,297
  2,488
  2,687
  2,894
  3,109
  3,332
  3,564
  3,805
  4,056
  4,317
  4,589
  4,871
  5,166
  5,473
  5,793
  6,127
  6,475
  6,839
  7,218
  7,615
  8,030
  8,464
  8,919
  9,394
  9,891
  10,412
  10,957
  11,529
  12,128
  12,755
Working capital, $m
  0
  -2,025
  -2,194
  -2,370
  -2,552
  -2,742
  -2,939
  -3,143
  -3,356
  -3,577
  -3,807
  -4,047
  -4,296
  -4,556
  -4,827
  -5,109
  -5,403
  -5,710
  -6,031
  -6,366
  -6,716
  -7,082
  -7,465
  -7,865
  -8,285
  -8,723
  -9,183
  -9,664
  -10,168
  -10,696
  -11,249
Total debt, $m
  41
  1,959
  2,082
  2,210
  2,343
  2,481
  2,625
  2,774
  2,929
  3,090
  3,258
  3,432
  3,614
  3,803
  4,000
  4,206
  4,420
  4,644
  4,878
  5,122
  5,377
  5,644
  5,923
  6,214
  6,520
  6,839
  7,174
  7,525
  7,892
  8,276
  8,680
Total liabilities, $m
  1,820
  1,476
  1,599
  1,727
  1,859
  1,998
  2,141
  2,290
  2,445
  2,606
  2,774
  2,949
  3,130
  3,320
  3,517
  3,722
  3,937
  4,161
  4,394
  4,638
  4,894
  5,160
  5,439
  5,731
  6,036
  6,356
  6,691
  7,041
  7,408
  7,793
  8,196
Total equity, $m
  233
  164
  178
  192
  207
  222
  238
  254
  272
  290
  308
  328
  348
  369
  391
  414
  437
  462
  488
  515
  544
  573
  604
  637
  671
  706
  743
  782
  823
  866
  911
Total liabilities and equity, $m
  2,053
  1,640
  1,777
  1,919
  2,066
  2,220
  2,379
  2,544
  2,717
  2,896
  3,082
  3,277
  3,478
  3,689
  3,908
  4,136
  4,374
  4,623
  4,882
  5,153
  5,438
  5,733
  6,043
  6,368
  6,707
  7,062
  7,434
  7,823
  8,231
  8,659
  9,107
Debt-to-equity ratio
  0.176
  11.950
  11.720
  11.520
  11.340
  11.180
  11.030
  10.900
  10.780
  10.670
  10.570
  10.480
  10.390
  10.310
  10.240
  10.170
  10.110
  10.050
  9.990
  9.940
  9.890
  9.840
  9.800
  9.760
  9.720
  9.680
  9.650
  9.620
  9.590
  9.560
  9.530
Adjusted equity ratio
  0.113
  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
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  17
  -78
  -74
  -78
  -83
  -87
  -92
  -97
  -102
  -107
  -112
  -118
  -124
  -130
  -136
  -143
  -149
  -157
  -164
  -172
  -180
  -189
  -197
  -207
  -216
  -227
  -237
  -248
  -260
  -272
  -285
Depreciation, amort., depletion, $m
  5
  230
  249
  269
  289
  311
  333
  356
  381
  406
  432
  459
  487
  517
  547
  579
  613
  647
  684
  722
  762
  803
  846
  892
  939
  989
  1,041
  1,096
  1,153
  1,213
  1,276
Funds from operations, $m
  23
  152
  175
  190
  207
  224
  241
  260
  279
  299
  320
  341
  364
  387
  411
  437
  463
  491
  520
  550
  582
  615
  649
  685
  723
  762
  804
  847
  893
  940
  990
Change in working capital, $m
  -1
  -162
  -169
  -175
  -182
  -190
  -197
  -205
  -213
  -221
  -230
  -239
  -249
  -260
  -271
  -282
  -294
  -307
  -321
  -335
  -350
  -366
  -383
  -400
  -419
  -439
  -459
  -481
  -504
  -528
  -553
Cash from operations, $m
  24
  314
  343
  366
  389
  413
  438
  465
  492
  520
  550
  581
  613
  647
  682
  719
  758
  798
  841
  885
  932
  981
  1,032
  1,086
  1,142
  1,201
  1,263
  1,328
  1,397
  1,468
  1,544
Maintenance CAPEX, $m
  0
  -211
  -230
  -249
  -269
  -289
  -311
  -333
  -356
  -381
  -406
  -432
  -459
  -487
  -517
  -547
  -579
  -613
  -647
  -684
  -722
  -762
  -803
  -846
  -892
  -939
  -989
  -1,041
  -1,096
  -1,153
  -1,213
New CAPEX, $m
  -2
  -190
  -191
  -199
  -207
  -215
  -223
  -232
  -241
  -251
  -261
  -272
  -283
  -294
  -307
  -320
  -334
  -348
  -364
  -380
  -397
  -415
  -434
  -454
  -475
  -497
  -521
  -545
  -571
  -599
  -628
Cash from investing activities, $m
  -115
  -401
  -421
  -448
  -476
  -504
  -534
  -565
  -597
  -632
  -667
  -704
  -742
  -781
  -824
  -867
  -913
  -961
  -1,011
  -1,064
  -1,119
  -1,177
  -1,237
  -1,300
  -1,367
  -1,436
  -1,510
  -1,586
  -1,667
  -1,752
  -1,841
Free cash flow, $m
  -91
  -86
  -78
  -82
  -86
  -91
  -96
  -101
  -106
  -111
  -117
  -123
  -129
  -135
  -142
  -148
  -155
  -163
  -171
  -179
  -187
  -196
  -205
  -215
  -225
  -236
  -247
  -258
  -270
  -283
  -297
Issuance/(repayment) of debt, $m
  87
  -24
  123
  128
  133
  138
  144
  149
  155
  161
  168
  174
  182
  189
  197
  206
  214
  224
  234
  244
  255
  267
  279
  292
  305
  320
  335
  351
  367
  385
  403
Issuance/(repurchase) of shares, $m
  -4
  242
  88
  93
  97
  102
  108
  113
  119
  125
  131
  137
  144
  151
  158
  165
  173
  181
  190
  199
  208
  218
  228
  239
  250
  262
  274
  287
  301
  315
  330
Cash from financing (excl. dividends), $m  
  120
  218
  211
  221
  230
  240
  252
  262
  274
  286
  299
  311
  326
  340
  355
  371
  387
  405
  424
  443
  463
  485
  507
  531
  555
  582
  609
  638
  668
  700
  733
Total cash flow (excl. dividends), $m
  30
  132
  133
  138
  144
  150
  155
  162
  168
  175
  182
  189
  197
  205
  214
  223
  232
  242
  253
  264
  276
  289
  302
  316
  331
  346
  362
  380
  398
  417
  437
Retained Cash Flow (-), $m
  -10
  -242
  -88
  -93
  -97
  -102
  -108
  -113
  -119
  -125
  -131
  -137
  -144
  -151
  -158
  -165
  -173
  -181
  -190
  -199
  -208
  -218
  -228
  -239
  -250
  -262
  -274
  -287
  -301
  -315
  -330
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
 
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  5
  5
  5
  5
  6
Cash available for distribution, $m
 
  -110
  45
  46
  47
  47
  48
  48
  49
  50
  51
  52
  53
  54
  56
  57
  59
  61
  63
  65
  68
  71
  74
  77
  80
  84
  88
  92
  97
  102
  107
Discount rate, %
 
  14.90
  15.65
  16.43
  17.25
  18.11
  19.02
  19.97
  20.97
  22.01
  23.11
  24.27
  25.48
  26.76
  28.10
  29.50
  30.98
  32.52
  34.15
  35.86
  37.65
  39.53
  41.51
  43.59
  45.77
  48.05
  50.46
  52.98
  55.63
  58.41
  61.33
PV of cash for distribution, $m
 
  -96
  34
  29
  25
  21
  17
  14
  11
  8
  6
  5
  3
  2
  2
  1
  1
  1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  50.0
  32.5
  21.4
  14.2
  9.5
  6.4
  4.3
  3.0
  2.0
  1.4
  1.0
  0.7
  0.5
  0.3
  0.2
  0.2
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Bear State Financial, Inc. is a bank holding company. The Company's subsidiary Bear State Bank, N.A. (the Bank) is a community-oriented financial institution, which offers a range of retail and business deposit accounts, including noninterest bearing and interest bearing checking accounts, savings and money market accounts, certificates of deposit and individual retirement accounts. The Loan products offered by the Bank include residential real estate loans, consumer loans, construction loans, lines of credit, commercial real estate loans, and commercial business loans. The Bank's other financial services include automated teller machines; around the clock telephone banking; online banking, including account access, bill payment and e-statements; mobile banking, including remote deposit capture and funds transfer; Bounce Protection overdraft services; debit cards, and safe deposit boxes.

FINANCIAL RATIOS  of  Bear State Financial (BSF)

Valuation Ratios
P/E Ratio 22.8
Price to Sales 0
Price to Book 1.7
Price to Tangible Book
Price to Cash Flow 16.2
Price to Free Cash Flow 17.6
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -60%
Cap. Spend. - 3 Yr. Gr. Rate 0%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 17.6%
Total Debt to Equity 17.6%
Interest Coverage 4
Management Effectiveness
Return On Assets 1.1%
Ret/ On Assets - 3 Yr. Avg. 2.4%
Return On Total Capital 6.4%
Ret/ On T. Cap. - 3 Yr. Avg. 9.5%
Return On Equity 7.5%
Return On Equity - 3 Yr. Avg. 11%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 29.2%
Eff/ Tax Rate - 3 Yr. Avg. -148.1%
Payout Ratio 17.6%

BSF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BSF stock intrinsic value calculation we used $89 million for the last fiscal year's total revenue generated by Bear State Financial. The default revenue input number comes from 2016 income statement of Bear State Financial. 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 BSF stock valuation model: a) initial revenue growth rate of 8.7% 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 14.9%, whose default value for BSF is calculated based on our internal credit rating of Bear State Financial, 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 Bear State Financial.
    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 BSF stock the variable cost ratio is equal to 69.9%.

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 BSF stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Bear State Financial.

Corporate tax rate of 27% is the nominal tax rate for Bear State Financial. 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 BSF stock is equal to 1.1%.

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 BSF are equal to 2373.9%.

Life of production assets of 10 years is the average useful life of capital assets used in Bear State Financial 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 BSF is equal to -2093.6%. 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 - $0 million for Bear State Financial - 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 38 million for Bear State Financial 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 Bear State Financial at the current share price and the inputted number of shares is $0.4 billion.

RELATED COMPANIES Price Int.Val. Rating
SMBC Southern Misso 39.86 6.78  str.sell
Financial statements of BSF
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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