Intrinsic value of Cresud ADR - CRESY

Previous Close

$21.02

  Intrinsic Value

premium content

  Rating & Target

premium content

  Value-price divergence*

premium content

Previous close

$21.02

 
Intrinsic value

$2,010

 
Up/down potential

+999%

 
Rating

str. buy

 
Value-price divergence* premium content

Premium access subscription - $499/yr

please register and log in before paying

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

We calculate the intrinsic value of CRESY 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 1.1

 

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, %
  525.69
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  2,265
  3,624
  5,599
  8,373
  12,149
  17,141
  23,565
  31,631
  41,534
  53,444
  67,504
  83,824
  102,483
  123,527
  146,973
  172,814
  201,024
  231,563
  264,381
  299,425
  336,643
  375,985
  417,411
  460,890
  506,401
  553,938
  603,507
  655,128
  708,837
  764,682
  822,726
Variable operating expenses, $m
 
  1,834
  2,833
  4,237
  6,148
  8,673
  11,924
  16,005
  21,016
  27,043
  34,157
  42,415
  51,857
  62,505
  74,368
  87,444
  101,718
  117,171
  133,777
  151,509
  170,341
  190,248
  211,210
  233,210
  256,239
  280,292
  305,374
  331,495
  358,671
  386,929
  416,299
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
  2,047
  1,834
  2,833
  4,237
  6,148
  8,673
  11,924
  16,005
  21,016
  27,043
  34,157
  42,415
  51,857
  62,505
  74,368
  87,444
  101,718
  117,171
  133,777
  151,509
  170,341
  190,248
  211,210
  233,210
  256,239
  280,292
  305,374
  331,495
  358,671
  386,929
  416,299
Operating income, $m
  217
  1,790
  2,766
  4,136
  6,002
  8,468
  11,641
  15,626
  20,518
  26,401
  33,347
  41,409
  50,627
  61,022
  72,605
  85,370
  99,306
  114,392
  130,604
  147,916
  166,301
  185,737
  206,201
  227,680
  250,162
  273,645
  298,132
  323,633
  350,165
  377,753
  406,427
EBITDA, $m
  394
  2,074
  3,204
  4,791
  6,952
  9,809
  13,484
  18,100
  23,767
  30,582
  38,627
  47,966
  58,644
  70,685
  84,101
  98,888
  115,031
  132,506
  151,285
  171,338
  192,635
  215,148
  238,853
  263,733
  289,775
  316,977
  345,341
  374,881
  405,614
  437,570
  470,784
Interest expense (income), $m
  263
  390
  646
  1,107
  1,753
  2,633
  3,797
  5,294
  7,174
  9,482
  12,258
  15,535
  19,338
  23,687
  28,592
  34,056
  40,079
  46,654
  53,771
  61,420
  69,588
  78,262
  87,432
  97,087
  107,220
  117,827
  128,907
  140,460
  152,491
  165,009
  178,024
Earnings before tax, $m
  -171
  1,400
  2,120
  3,030
  4,249
  5,834
  7,844
  10,332
  13,344
  16,919
  21,089
  25,875
  31,288
  37,335
  44,013
  51,314
  59,227
  67,738
  76,833
  86,496
  96,713
  107,474
  118,770
  130,593
  142,942
  155,818
  169,226
  183,174
  197,675
  212,744
  228,402
Tax expense, $m
  -13
  378
  572
  818
  1,147
  1,575
  2,118
  2,790
  3,603
  4,568
  5,694
  6,986
  8,448
  10,080
  11,883
  13,855
  15,991
  18,289
  20,745
  23,354
  26,113
  29,018
  32,068
  35,260
  38,594
  42,071
  45,691
  49,457
  53,372
  57,441
  61,669
Net income, $m
  -90
  1,022
  1,547
  2,212
  3,101
  4,259
  5,726
  7,542
  9,741
  12,351
  15,395
  18,888
  22,840
  27,255
  32,129
  37,459
  43,236
  49,449
  56,088
  63,142
  70,601
  78,456
  86,702
  95,333
  104,348
  113,747
  123,535
  133,717
  144,302
  155,303
  166,734

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,602
  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
  10,624
  14,438
  22,307
  33,360
  48,404
  68,291
  93,885
  126,021
  165,473
  212,923
  268,940
  333,962
  408,301
  492,139
  585,549
  688,501
  800,892
  922,561
  1,053,310
  1,192,929
  1,341,206
  1,497,949
  1,662,994
  1,836,215
  2,017,534
  2,206,923
  2,404,408
  2,610,072
  2,824,052
  3,046,542
  3,277,792
Adjusted assets (=assets-cash), $m
  9,022
  14,438
  22,307
  33,360
  48,404
  68,291
  93,885
  126,021
  165,473
  212,923
  268,940
  333,962
  408,301
  492,139
  585,549
  688,501
  800,892
  922,561
  1,053,310
  1,192,929
  1,341,206
  1,497,949
  1,662,994
  1,836,215
  2,017,534
  2,206,923
  2,404,408
  2,610,072
  2,824,052
  3,046,542
  3,277,792
Revenue / Adjusted assets
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
Average production assets, $m
  2,994
  4,791
  7,402
  11,070
  16,062
  22,660
  31,153
  41,816
  54,908
  70,653
  89,240
  110,816
  135,483
  163,303
  194,298
  228,460
  265,754
  306,126
  349,512
  395,840
  445,042
  497,052
  551,818
  609,297
  669,462
  732,306
  797,836
  866,079
  937,082
  1,010,910
  1,087,643
Working capital, $m
  -24
  -196
  -302
  -452
  -656
  -926
  -1,273
  -1,708
  -2,243
  -2,886
  -3,645
  -4,527
  -5,534
  -6,670
  -7,937
  -9,332
  -10,855
  -12,504
  -14,277
  -16,169
  -18,179
  -20,303
  -22,540
  -24,888
  -27,346
  -29,913
  -32,589
  -35,377
  -38,277
  -41,293
  -44,427
Total debt, $m
  7,507
  9,943
  17,025
  26,973
  40,513
  58,411
  81,445
  110,367
  145,875
  188,580
  238,995
  297,515
  364,419
  439,874
  523,943
  616,600
  717,752
  827,254
  944,928
  1,070,585
  1,204,034
  1,345,103
  1,493,643
  1,649,542
  1,812,730
  1,983,180
  2,160,917
  2,346,014
  2,538,595
  2,738,837
  2,946,962
Total liabilities, $m
  10,559
  12,994
  20,076
  30,024
  43,564
  61,462
  84,496
  113,418
  148,926
  191,631
  242,046
  300,566
  367,470
  442,925
  526,994
  619,651
  720,803
  830,305
  947,979
  1,073,636
  1,207,085
  1,348,154
  1,496,694
  1,652,593
  1,815,781
  1,986,231
  2,163,968
  2,349,065
  2,541,646
  2,741,888
  2,950,013
Total equity, $m
  66
  1,444
  2,231
  3,336
  4,840
  6,829
  9,388
  12,602
  16,547
  21,292
  26,894
  33,396
  40,830
  49,214
  58,555
  68,850
  80,089
  92,256
  105,331
  119,293
  134,121
  149,795
  166,299
  183,621
  201,753
  220,692
  240,441
  261,007
  282,405
  304,654
  327,779
Total liabilities and equity, $m
  10,625
  14,438
  22,307
  33,360
  48,404
  68,291
  93,884
  126,020
  165,473
  212,923
  268,940
  333,962
  408,300
  492,139
  585,549
  688,501
  800,892
  922,561
  1,053,310
  1,192,929
  1,341,206
  1,497,949
  1,662,993
  1,836,214
  2,017,534
  2,206,923
  2,404,409
  2,610,072
  2,824,051
  3,046,542
  3,277,792
Debt-to-equity ratio
  113.742
  6.890
  7.630
  8.090
  8.370
  8.550
  8.680
  8.760
  8.820
  8.860
  8.890
  8.910
  8.930
  8.940
  8.950
  8.960
  8.960
  8.970
  8.970
  8.970
  8.980
  8.980
  8.980
  8.980
  8.980
  8.990
  8.990
  8.990
  8.990
  8.990
  8.990
Adjusted equity ratio
  -0.160
  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
  -90
  1,022
  1,547
  2,212
  3,101
  4,259
  5,726
  7,542
  9,741
  12,351
  15,395
  18,888
  22,840
  27,255
  32,129
  37,459
  43,236
  49,449
  56,088
  63,142
  70,601
  78,456
  86,702
  95,333
  104,348
  113,747
  123,535
  133,717
  144,302
  155,303
  166,734
Depreciation, amort., depletion, $m
  177
  283
  438
  655
  950
  1,341
  1,843
  2,474
  3,249
  4,181
  5,280
  6,557
  8,017
  9,663
  11,497
  13,518
  15,725
  18,114
  20,681
  23,422
  26,334
  29,411
  32,652
  36,053
  39,613
  43,332
  47,209
  51,247
  55,449
  59,817
  64,358
Funds from operations, $m
  197
  1,305
  1,985
  2,867
  4,052
  5,600
  7,570
  10,017
  12,990
  16,532
  20,676
  25,446
  30,857
  36,917
  43,626
  50,977
  58,961
  67,563
  76,769
  86,564
  96,935
  107,868
  119,354
  131,386
  143,961
  157,079
  170,744
  184,964
  199,751
  215,120
  231,091
Change in working capital, $m
  -63
  -73
  -107
  -150
  -204
  -270
  -347
  -436
  -535
  -643
  -759
  -881
  -1,008
  -1,136
  -1,266
  -1,395
  -1,523
  -1,649
  -1,772
  -1,892
  -2,010
  -2,124
  -2,237
  -2,348
  -2,458
  -2,567
  -2,677
  -2,788
  -2,900
  -3,016
  -3,134
Cash from operations, $m
  260
  4,015
  2,092
  3,017
  4,256
  5,869
  7,917
  10,452
  13,525
  17,175
  21,435
  26,327
  31,865
  38,054
  44,892
  52,373
  60,484
  69,212
  78,541
  88,457
  98,944
  109,992
  121,591
  133,734
  146,418
  159,646
  173,421
  187,752
  202,651
  218,136
  234,226
Maintenance CAPEX, $m
  0
  -177
  -283
  -438
  -655
  -950
  -1,341
  -1,843
  -2,474
  -3,249
  -4,181
  -5,280
  -6,557
  -8,017
  -9,663
  -11,497
  -13,518
  -15,725
  -18,114
  -20,681
  -23,422
  -26,334
  -29,411
  -32,652
  -36,053
  -39,613
  -43,332
  -47,209
  -51,247
  -55,449
  -59,817
New CAPEX, $m
  -82
  -1,797
  -2,611
  -3,668
  -4,992
  -6,599
  -8,492
  -10,663
  -13,091
  -15,745
  -18,587
  -21,576
  -24,667
  -27,820
  -30,995
  -34,162
  -37,294
  -40,372
  -43,386
  -46,328
  -49,202
  -52,011
  -54,765
  -57,479
  -60,166
  -62,843
  -65,530
  -68,244
  -71,003
  -73,827
  -76,734
Cash from investing activities, $m
  554
  -1,974
  -2,894
  -4,106
  -5,647
  -7,549
  -9,833
  -12,506
  -15,565
  -18,994
  -22,768
  -26,856
  -31,224
  -35,837
  -40,658
  -45,659
  -50,812
  -56,097
  -61,500
  -67,009
  -72,624
  -78,345
  -84,176
  -90,131
  -96,219
  -102,456
  -108,862
  -115,453
  -122,250
  -129,276
  -136,551
Free cash flow, $m
  814
  2,041
  -803
  -1,089
  -1,391
  -1,680
  -1,917
  -2,055
  -2,041
  -1,819
  -1,333
  -529
  641
  2,217
  4,234
  6,714
  9,672
  13,115
  17,042
  21,447
  26,320
  31,648
  37,414
  43,603
  50,200
  57,189
  64,559
  72,299
  80,401
  88,860
  97,675
Issuance/(repayment) of debt, $m
  113
  3,939
  7,082
  9,948
  13,539
  17,898
  23,034
  28,922
  35,507
  42,705
  50,415
  58,520
  66,905
  75,455
  84,068
  92,657
  101,152
  109,502
  117,675
  125,657
  133,450
  141,069
  148,540
  155,899
  163,187
  170,450
  177,737
  185,097
  192,582
  200,241
  208,125
Issuance/(repurchase) of shares, $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
Cash from financing (excl. dividends), $m  
  -273
  3,939
  7,082
  9,948
  13,539
  17,898
  23,034
  28,922
  35,507
  42,705
  50,415
  58,520
  66,905
  75,455
  84,068
  92,657
  101,152
  109,502
  117,675
  125,657
  133,450
  141,069
  148,540
  155,899
  163,187
  170,450
  177,737
  185,097
  192,582
  200,241
  208,125
Total cash flow (excl. dividends), $m
  877
  5,980
  6,279
  8,859
  12,148
  16,218
  21,117
  26,868
  33,466
  40,886
  49,081
  57,991
  67,545
  77,672
  88,303
  99,371
  110,824
  122,616
  134,716
  147,104
  159,770
  172,716
  185,954
  199,502
  213,387
  227,639
  242,296
  257,396
  272,983
  289,102
  305,800
Retained Cash Flow (-), $m
  59
  -1,477
  -787
  -1,105
  -1,504
  -1,989
  -2,559
  -3,214
  -3,945
  -4,745
  -5,602
  -6,502
  -7,434
  -8,384
  -9,341
  -10,295
  -11,239
  -12,167
  -13,075
  -13,962
  -14,828
  -15,674
  -16,504
  -17,322
  -18,132
  -18,939
  -19,749
  -20,566
  -21,398
  -22,249
  -23,125
Prev. year cash balance distribution, $m
 
  99
  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
 
  4,602
  5,492
  7,753
  10,644
  14,230
  18,558
  23,654
  29,521
  36,141
  43,480
  51,489
  60,111
  69,289
  78,962
  89,076
  99,585
  110,449
  121,641
  133,142
  144,942
  157,042
  169,450
  182,180
  195,255
  208,700
  222,547
  236,829
  251,585
  266,853
  282,675
Discount rate, %
 
  12.30
  12.92
  13.56
  14.24
  14.95
  15.70
  16.48
  17.31
  18.17
  19.08
  20.04
  21.04
  22.09
  23.19
  24.35
  25.57
  26.85
  28.19
  29.60
  31.08
  32.64
  34.27
  35.98
  37.78
  39.67
  41.65
  43.73
  45.92
  48.22
  50.63
PV of cash for distribution, $m
 
  4,098
  4,308
  5,294
  6,250
  7,090
  7,737
  8,130
  8,232
  8,042
  7,583
  6,907
  6,080
  5,174
  4,258
  3,388
  2,606
  1,938
  1,392
  965
  646
  417
  259
  155
  89
  49
  26
  13
  6
  3
  1
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

Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria, an agricultural company, produces basic agricultural commodities in Brazil and other Latin American countries. The company’s Agricultural business is involved in planting, harvesting, and sale of crops, such as wheat, corn, soybean, cotton, and sunflower, as well as sugarcane; breeding, purchasing, and fattening of beef cattle for sale to meat processors and local livestock auction markets; producing raw milk for sale to local milk and milk-related products producers; leasing of farms to third parties; disposal and development of farmlands activities; and feedlot farming, as well as meat slaughtering and processing activities. Its Investment and Development Properties business engages in the commercial exploitation, development, and lease of commercial facilities and other spaces in shopping centers; lease and servicing of office spaces other rental properties; development, sale, and maintenance of undeveloped parcels of land and/or trading properties; operation of hotels; and provision of consumer financing services. The company was founded in 1936 and is headquartered in Buenos Aires, Argentina.

FINANCIAL RATIOS  of  Cresud ADR (CRESY)

Valuation Ratios
P/E Ratio -115.9
Price to Sales 4.6
Price to Book 158
Price to Tangible Book
Price to Cash Flow 40.1
Price to Free Cash Flow 58.6
Growth Rates
Sales Growth Rate 525.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 446.7%
Cap. Spend. - 3 Yr. Gr. Rate 28.9%
Financial Strength
Quick Ratio 1
Current Ratio 0
LT Debt to Equity 9097%
Total Debt to Equity 11374.2%
Interest Coverage 0
Management Effectiveness
Return On Assets 2.6%
Ret/ On Assets - 3 Yr. Avg. 0.8%
Return On Total Capital -2.2%
Ret/ On T. Cap. - 3 Yr. Avg. -4.3%
Return On Equity -94.2%
Return On Equity - 3 Yr. Avg. -45.5%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 26.3%
Gross Margin - 3 Yr. Avg. 18.9%
EBITDA Margin 11.9%
EBITDA Margin - 3 Yr. Avg. 9.8%
Operating Margin 9.6%
Oper. Margin - 3 Yr. Avg. 28.3%
Pre-Tax Margin -7.5%
Pre-Tax Margin - 3 Yr. Avg. -9.2%
Net Profit Margin -4%
Net Profit Margin - 3 Yr. Avg. -8.4%
Effective Tax Rate 7.6%
Eff/ Tax Rate - 3 Yr. Avg. 19.6%
Payout Ratio -16.7%

CRESY stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CRESY stock intrinsic value calculation we used $2265 million for the last fiscal year's total revenue generated by Cresud ADR. The default revenue input number comes from 2016 income statement of Cresud 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 CRESY stock valuation model: a) initial revenue growth rate of 60% 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 12.3%, whose default value for CRESY is calculated based on our internal credit rating of Cresud 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 Cresud 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 CRESY stock the variable cost ratio is equal to 50.6%.

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 CRESY 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 6.5% for Cresud ADR.

Corporate tax rate of 27% is the nominal tax rate for Cresud 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 CRESY 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 CRESY are equal to 132.2%.

Life of production assets of 16.9 years is the average useful life of capital assets used in Cresud 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 CRESY is equal to -5.4%. 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 - $66 million for Cresud 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 50.324 million for Cresud 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 Cresud ADR at the current share price and the inputted number of shares is $1.1 billion.


Premium access subscription - $499/yr

please register and log in before paying
RELATED COMPANIES Price Int.Val. Rating
ALCO Alico 29.95 5.12  str.sell
AGRO Adecoagro 11.09 146.91  str.buy
IRCP IRSA Propiedad 48.00 94.49  str.buy
BG Bunge 79.03 205.43  str.buy

COMPANY NEWS

▶ ETFs with exposure to Cresud SA : April 5, 2017   [Apr-05-17 04:34PM  Capital Cube]
▶ Cresud posts 2Q profit   [Feb-13-17 02:36PM  Associated Press]
▶ ETFs with exposure to Cresud SA : January 3, 2017   [Jan-03-17 01:53PM  Capital Cube]
▶ ETFs with exposure to Cresud SA : December 14, 2016   [Dec-14-16 11:38AM  Capital Cube]
▶ Is Iridium Communications Inc (IRDM) A Good Stock To Buy?   [Dec-09-16 07:28PM  Insider Monkey]
▶ The 'Trump Effect' On Latin America, Explained   [Nov-28-16 08:34AM  Benzinga]
▶ Cresud S.A.C.I.F. y A. Material Fact   [Nov-20  09:59AM  PR Newswire]
▶ How To Invest In Farming Without Owning a Farm   [Sep-16  05:01PM  at Investopedia]
▶ Cresud Sacifya (CRESY) Downgraded From Hold to Sell   [Nov-14  09:30AM  at TheStreet]
▶ Earnings Release 1Q15   [Nov-11  08:39PM  at noodls]
▶ Will Better Soybean Prices Boost Cresud?   [Jun-02  02:16PM  at Motley Fool]
▶ Cresud SA Stock Upgraded (CRESY)   [May-29  11:11AM  at TheStreet]
▶ SA PRO: Top Long And Short Ideas, Monday April 14   [Apr-15  05:00AM  at Seeking Alpha]
▶ Wall Street Breakfast: Must-Know News   [Apr-14  06:31AM  at Seeking Alpha]
▶ 3 Stocks Spiking on Unusual Volume   [Apr-08  08:05AM  at TheStreet]
▶ Macro Events Buffeting Adecoagro   [Mar-22  10:07AM  at Seeking Alpha]
▶ Better Times, Worse Times For Cresud   [Dec-19  09:37AM  at Seeking Alpha]
▶ Opportunities in Agriculture   [Nov-13  10:20AM  at TheStreet]
Stock chart of CRESY Financial statements of CRESY
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.