Intrinsic value of Ctrip.com International ADR - CTRP

Previous Close

$49.80

  Intrinsic Value

$145.09

stock screener

  Rating & Target

str. buy

+191%

  Value-price divergence*

-109%

Previous close

$49.80

 
Intrinsic value

$145.09

 
Up/down potential

+191%

 
Rating

str. buy

 
Value-price divergence*

-109%

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

We calculate the intrinsic value of CTRP 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 25.4

 

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, %
  76.41
  45.70
  41.63
  37.97
  34.67
  31.70
  29.03
  26.63
  24.47
  22.52
  20.77
  19.19
  17.77
  16.49
  15.35
  14.31
  13.38
  12.54
  11.79
  11.11
  10.50
  9.95
  9.45
  9.01
  8.61
  8.25
  7.92
  7.63
  7.37
  7.13
  6.92
Revenue, $m
  2,782
  4,053
  5,741
  7,920
  10,666
  14,048
  18,127
  22,954
  28,570
  35,004
  42,273
  50,386
  59,340
  69,128
  79,737
  91,148
  103,343
  116,304
  130,013
  144,456
  159,621
  175,501
  192,091
  209,395
  227,418
  246,172
  265,674
  285,943
  307,008
  328,898
  351,648
Variable operating expenses, $m
 
  3,537
  4,672
  6,138
  7,986
  10,260
  13,004
  16,251
  20,029
  24,357
  29,247
  33,894
  39,918
  46,503
  53,639
  61,315
  69,519
  78,237
  87,460
  97,176
  107,377
  118,059
  129,220
  140,860
  152,984
  165,600
  178,718
  192,354
  206,524
  221,249
  236,553
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
  3,016
  3,537
  4,672
  6,138
  7,986
  10,260
  13,004
  16,251
  20,029
  24,357
  29,247
  33,894
  39,918
  46,503
  53,639
  61,315
  69,519
  78,237
  87,460
  97,176
  107,377
  118,059
  129,220
  140,860
  152,984
  165,600
  178,718
  192,354
  206,524
  221,249
  236,553
Operating income, $m
  -234
  516
  1,069
  1,782
  2,681
  3,788
  5,122
  6,702
  8,540
  10,646
  13,026
  16,491
  19,422
  22,626
  26,098
  29,833
  33,824
  38,066
  42,554
  47,281
  52,244
  57,442
  62,872
  68,535
  74,434
  80,572
  86,955
  93,590
  100,484
  107,649
  115,095
EBITDA, $m
  -130
  1,454
  2,059
  2,841
  3,826
  5,040
  6,503
  8,234
  10,249
  12,557
  15,165
  18,075
  21,287
  24,799
  28,604
  32,698
  37,073
  41,722
  46,640
  51,821
  57,262
  62,958
  68,910
  75,117
  81,583
  88,310
  95,306
  102,578
  110,134
  117,987
  126,148
Interest expense (income), $m
  86
  175
  328
  531
  792
  1,122
  1,528
  2,018
  2,597
  3,271
  4,044
  4,916
  5,890
  6,966
  8,141
  9,414
  10,784
  12,248
  13,805
  15,450
  17,184
  19,005
  20,912
  22,903
  24,981
  27,145
  29,396
  31,738
  34,171
  36,700
  39,328
Earnings before tax, $m
  -255
  341
  741
  1,251
  1,889
  2,666
  3,595
  4,685
  5,943
  7,375
  8,982
  11,575
  13,532
  15,660
  17,957
  20,418
  23,040
  25,818
  28,749
  31,830
  35,060
  38,436
  41,960
  45,632
  49,453
  53,428
  57,559
  61,852
  66,313
  70,949
  75,767
Tax expense, $m
  69
  92
  200
  338
  510
  720
  971
  1,265
  1,605
  1,991
  2,425
  3,125
  3,654
  4,228
  4,848
  5,513
  6,221
  6,971
  7,762
  8,594
  9,466
  10,378
  11,329
  12,321
  13,352
  14,425
  15,541
  16,700
  17,905
  19,156
  20,457
Net income, $m
  -207
  249
  541
  914
  1,379
  1,946
  2,624
  3,420
  4,339
  5,384
  6,557
  8,450
  9,878
  11,432
  13,109
  14,905
  16,819
  18,847
  20,987
  23,236
  25,594
  28,059
  30,631
  33,311
  36,101
  39,002
  42,018
  45,152
  48,408
  51,792
  55,310

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  4,709
  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
  20,893
  23,566
  33,377
  46,049
  62,014
  81,675
  105,387
  133,451
  166,103
  203,509
  245,774
  292,941
  345,002
  401,910
  463,585
  529,927
  600,830
  676,185
  755,891
  839,862
  928,031
  1,020,353
  1,116,810
  1,217,413
  1,322,198
  1,431,233
  1,544,613
  1,662,462
  1,784,931
  1,912,197
  2,044,464
Adjusted assets (=assets-cash), $m
  16,184
  23,566
  33,377
  46,049
  62,014
  81,675
  105,387
  133,451
  166,103
  203,509
  245,774
  292,941
  345,002
  401,910
  463,585
  529,927
  600,830
  676,185
  755,891
  839,862
  928,031
  1,020,353
  1,116,810
  1,217,413
  1,322,198
  1,431,233
  1,544,613
  1,662,462
  1,784,931
  1,912,197
  2,044,464
Revenue / Adjusted assets
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
  0.172
Average production assets, $m
  2,625
  3,822
  5,414
  7,469
  10,058
  13,247
  17,093
  21,645
  26,941
  33,008
  39,863
  47,514
  55,958
  65,188
  75,192
  85,952
  97,452
  109,675
  122,603
  136,222
  150,523
  165,497
  181,142
  197,460
  214,455
  232,140
  250,530
  269,645
  289,509
  310,151
  331,604
Working capital, $m
  2,259
  -2,116
  -2,997
  -4,134
  -5,568
  -7,333
  -9,462
  -11,982
  -14,913
  -18,272
  -22,067
  -26,301
  -30,976
  -36,085
  -41,622
  -47,579
  -53,945
  -60,711
  -67,867
  -75,406
  -83,322
  -91,611
  -100,272
  -109,304
  -118,712
  -128,502
  -138,682
  -149,263
  -160,258
  -171,685
  -183,560
Total debt, $m
  6,009
  9,369
  15,157
  22,634
  32,053
  43,653
  57,643
  74,201
  93,465
  115,535
  140,471
  168,300
  199,016
  232,592
  268,980
  308,122
  349,955
  394,414
  441,441
  490,984
  543,003
  597,473
  654,383
  713,739
  775,562
  839,893
  906,787
  976,318
  1,048,574
  1,123,661
  1,201,699
Total liabilities, $m
  10,543
  13,904
  19,692
  27,169
  36,588
  48,188
  62,178
  78,736
  98,000
  120,070
  145,006
  172,835
  203,551
  237,127
  273,515
  312,657
  354,490
  398,949
  445,976
  495,519
  547,538
  602,008
  658,918
  718,274
  780,097
  844,428
  911,322
  980,853
  1,053,109
  1,128,196
  1,206,234
Total equity, $m
  10,349
  9,662
  13,684
  18,880
  25,426
  33,487
  43,209
  54,715
  68,102
  83,439
  100,767
  120,106
  141,451
  164,783
  190,070
  217,270
  246,340
  277,236
  309,916
  344,344
  380,493
  418,345
  457,892
  499,139
  542,101
  586,806
  633,291
  681,609
  731,822
  784,001
  838,230
Total liabilities and equity, $m
  20,892
  23,566
  33,376
  46,049
  62,014
  81,675
  105,387
  133,451
  166,102
  203,509
  245,773
  292,941
  345,002
  401,910
  463,585
  529,927
  600,830
  676,185
  755,892
  839,863
  928,031
  1,020,353
  1,116,810
  1,217,413
  1,322,198
  1,431,234
  1,544,613
  1,662,462
  1,784,931
  1,912,197
  2,044,464
Debt-to-equity ratio
  0.581
  0.970
  1.110
  1.200
  1.260
  1.300
  1.330
  1.360
  1.370
  1.380
  1.390
  1.400
  1.410
  1.410
  1.420
  1.420
  1.420
  1.420
  1.420
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
  1.430
Adjusted equity ratio
  0.409
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -207
  249
  541
  914
  1,379
  1,946
  2,624
  3,420
  4,339
  5,384
  6,557
  8,450
  9,878
  11,432
  13,109
  14,905
  16,819
  18,847
  20,987
  23,236
  25,594
  28,059
  30,631
  33,311
  36,101
  39,002
  42,018
  45,152
  48,408
  51,792
  55,310
Depreciation, amort., depletion, $m
  104
  938
  991
  1,059
  1,146
  1,252
  1,380
  1,532
  1,708
  1,911
  2,139
  1,584
  1,865
  2,173
  2,506
  2,865
  3,248
  3,656
  4,087
  4,541
  5,017
  5,517
  6,038
  6,582
  7,149
  7,738
  8,351
  8,988
  9,650
  10,338
  11,053
Funds from operations, $m
  1,256
  1,187
  1,532
  1,973
  2,524
  3,198
  4,004
  4,952
  6,047
  7,294
  8,696
  10,033
  11,743
  13,605
  15,615
  17,771
  20,068
  22,503
  25,074
  27,777
  30,611
  33,575
  36,669
  39,893
  43,249
  46,740
  50,369
  54,140
  58,059
  62,131
  66,363
Change in working capital, $m
  493
  -664
  -881
  -1,138
  -1,433
  -1,765
  -2,129
  -2,520
  -2,932
  -3,358
  -3,795
  -4,235
  -4,674
  -5,109
  -5,537
  -5,957
  -6,366
  -6,766
  -7,156
  -7,539
  -7,916
  -8,289
  -8,660
  -9,032
  -9,408
  -9,790
  -10,180
  -10,581
  -10,996
  -11,426
  -11,875
Cash from operations, $m
  763
  1,850
  2,412
  3,111
  3,958
  4,963
  6,133
  7,472
  8,979
  10,653
  12,491
  14,268
  16,418
  18,714
  21,153
  23,727
  26,434
  29,269
  32,230
  35,316
  38,527
  41,864
  45,329
  48,926
  52,658
  56,530
  60,549
  64,721
  69,054
  73,557
  78,239
Maintenance CAPEX, $m
  0
  -87
  -127
  -180
  -249
  -335
  -442
  -570
  -722
  -898
  -1,100
  -1,329
  -1,584
  -1,865
  -2,173
  -2,506
  -2,865
  -3,248
  -3,656
  -4,087
  -4,541
  -5,017
  -5,517
  -6,038
  -6,582
  -7,149
  -7,738
  -8,351
  -8,988
  -9,650
  -10,338
New CAPEX, $m
  -100
  -1,198
  -1,591
  -2,055
  -2,590
  -3,189
  -3,846
  -4,552
  -5,296
  -6,067
  -6,855
  -7,650
  -8,444
  -9,230
  -10,003
  -10,761
  -11,500
  -12,222
  -12,928
  -13,620
  -14,301
  -14,974
  -15,645
  -16,317
  -16,996
  -17,685
  -18,390
  -19,115
  -19,864
  -20,642
  -21,453
Cash from investing activities, $m
  -2,868
  -1,285
  -1,718
  -2,235
  -2,839
  -3,524
  -4,288
  -5,122
  -6,018
  -6,965
  -7,955
  -8,979
  -10,028
  -11,095
  -12,176
  -13,267
  -14,365
  -15,470
  -16,584
  -17,707
  -18,842
  -19,991
  -21,162
  -22,355
  -23,578
  -24,834
  -26,128
  -27,466
  -28,852
  -30,292
  -31,791
Free cash flow, $m
  -2,105
  565
  694
  875
  1,119
  1,439
  1,846
  2,350
  2,961
  3,688
  4,535
  5,289
  6,390
  7,619
  8,976
  10,460
  12,068
  13,798
  15,646
  17,610
  19,686
  21,873
  24,168
  26,570
  29,080
  31,696
  34,421
  37,256
  40,202
  43,265
  46,447
Issuance/(repayment) of debt, $m
  1,433
  4,357
  5,788
  7,477
  9,420
  11,600
  13,990
  16,558
  19,264
  22,070
  24,936
  27,828
  30,716
  33,576
  36,388
  39,142
  41,833
  44,459
  47,027
  49,543
  52,019
  54,470
  56,910
  59,355
  61,823
  64,331
  66,894
  69,531
  72,256
  75,087
  78,038
Issuance/(repurchase) of shares, $m
  1,572
  2,776
  3,482
  4,282
  5,167
  6,115
  7,098
  8,086
  9,048
  9,953
  10,772
  10,889
  11,467
  11,900
  12,178
  12,295
  12,251
  12,048
  11,693
  11,192
  10,555
  9,793
  8,917
  7,936
  6,861
  5,702
  4,468
  3,166
  1,804
  387
  0
Cash from financing (excl. dividends), $m  
  1,778
  7,133
  9,270
  11,759
  14,587
  17,715
  21,088
  24,644
  28,312
  32,023
  35,708
  38,717
  42,183
  45,476
  48,566
  51,437
  54,084
  56,507
  58,720
  60,735
  62,574
  64,263
  65,827
  67,291
  68,684
  70,033
  71,362
  72,697
  74,060
  75,474
  78,038
Total cash flow (excl. dividends), $m
  -113
  7,698
  9,964
  12,633
  15,706
  19,154
  22,934
  26,994
  31,274
  35,710
  40,243
  44,006
  48,573
  53,095
  57,542
  61,898
  66,152
  70,306
  74,365
  78,344
  82,261
  86,136
  89,994
  93,862
  97,764
  101,729
  105,783
  109,952
  114,262
  118,738
  124,485
Retained Cash Flow (-), $m
  -3,904
  -3,025
  -4,022
  -5,196
  -6,546
  -8,061
  -9,722
  -11,506
  -13,387
  -15,337
  -17,329
  -19,338
  -21,345
  -23,332
  -25,287
  -27,201
  -29,070
  -30,896
  -32,680
  -34,428
  -36,149
  -37,852
  -39,548
  -41,247
  -42,962
  -44,704
  -46,486
  -48,318
  -50,212
  -52,179
  -54,229
Prev. year cash balance distribution, $m
 
  3,712
  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
 
  8,385
  5,941
  7,438
  9,160
  11,093
  13,212
  15,488
  17,887
  20,374
  22,915
  24,668
  27,228
  29,762
  32,256
  34,697
  37,082
  39,410
  41,686
  43,916
  46,112
  48,284
  50,447
  52,615
  54,802
  57,025
  59,297
  61,634
  64,050
  66,559
  70,255
Discount rate, %
 
  5.20
  5.46
  5.73
  6.02
  6.32
  6.64
  6.97
  7.32
  7.68
  8.07
  8.47
  8.89
  9.34
  9.81
  10.30
  10.81
  11.35
  11.92
  12.51
  13.14
  13.80
  14.49
  15.21
  15.97
  16.77
  17.61
  18.49
  19.41
  20.38
  21.40
PV of cash for distribution, $m
 
  7,971
  5,342
  6,292
  7,250
  8,165
  8,985
  9,665
  10,167
  10,465
  10,548
  10,086
  9,794
  9,324
  8,707
  7,978
  7,176
  6,336
  5,492
  4,674
  3,904
  3,199
  2,572
  2,026
  1,564
  1,182
  874
  632
  446
  307
  209
Current shareholders' claim on cash, %
  100
  85.4
  74.5
  66.1
  59.4
  54.1
  49.8
  46.3
  43.4
  40.9
  38.9
  37.2
  35.8
  34.7
  33.6
  32.8
  32.0
  31.4
  30.9
  30.4
  30.1
  29.7
  29.5
  29.3
  29.1
  29.0
  28.9
  28.8
  28.8
  28.8
  28.8

Ctrip.com International, Ltd. (Ctrip) is a travel service provider for accommodation reservation, transportation ticketing, packaged tours and corporate travel management in China. The Company aggregates hotel and transportation information to enable business and leisure travelers to make bookings. It helps leisure travelers book tour packages and guided tours, and helps corporate clients manage their travel requirements. In addition, it offers a range of other travel-related services, including travelers' reviews, attraction tickets, travel-related financing and car services, and travel insurance and visa services to meet the various booking and travelling needs of both leisure and business travelers. It also offers independent leisure travelers bundled packaged-tour products, including group tours, semi-group tours and private tours or packaged tours with different transportation arrangements, such as cruise, bus or self-driving.

FINANCIAL RATIOS  of  Ctrip.com International ADR (CTRP)

Valuation Ratios
P/E Ratio -15.4
Price to Sales 1.1
Price to Book 0.3
Price to Tangible Book
Price to Cash Flow 4.2
Price to Free Cash Flow 4.8
Growth Rates
Sales Growth Rate 76.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 5.3%
Cap. Spend. - 3 Yr. Gr. Rate 1.2%
Financial Strength
Quick Ratio 5
Current Ratio 0.1
LT Debt to Equity 48.4%
Total Debt to Equity 58.1%
Interest Coverage -2
Management Effectiveness
Return On Assets -0.5%
Ret/ On Assets - 3 Yr. Avg. 1.3%
Return On Total Capital -1.5%
Ret/ On T. Cap. - 3 Yr. Avg. 1.7%
Return On Equity -2.5%
Return On Equity - 3 Yr. Avg. 3.2%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 75.4%
Gross Margin - 3 Yr. Avg. 73%
EBITDA Margin -2.3%
EBITDA Margin - 3 Yr. Avg. 11.7%
Operating Margin -8.4%
Oper. Margin - 3 Yr. Avg. -2.5%
Pre-Tax Margin -9.2%
Pre-Tax Margin - 3 Yr. Avg. 6.8%
Net Profit Margin -7.4%
Net Profit Margin - 3 Yr. Avg. 6.3%
Effective Tax Rate -27.1%
Eff/ Tax Rate - 3 Yr. Avg. 27.9%
Payout Ratio 0%

CTRP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CTRP stock intrinsic value calculation we used $2782 million for the last fiscal year's total revenue generated by Ctrip.com International ADR. The default revenue input number comes from 2016 income statement of Ctrip.com International 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 CTRP stock valuation model: a) initial revenue growth rate of 45.7% 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 5.2%, whose default value for CTRP is calculated based on our internal credit rating of Ctrip.com International 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 Ctrip.com International 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 CTRP stock the variable cost ratio is equal to 96.4%.

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 CTRP 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 Ctrip.com International ADR.

Corporate tax rate of 27% is the nominal tax rate for Ctrip.com International 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 CTRP 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 CTRP are equal to 94.3%.

Life of production assets of 96 years is the average useful life of capital assets used in Ctrip.com International 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 CTRP is equal to -52.2%. 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 - $10349 million for Ctrip.com International 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 509.718 million for Ctrip.com International 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 Ctrip.com International ADR at the current share price and the inputted number of shares is $25.4 billion.

RELATED COMPANIES Price Int.Val. Rating
PCLN Priceline Grou 1,927.86 2,160.71  buy
EXPE Expedia 153.40 504.86  str.buy
TZOO Travelzoo 7.75 3.49  str.sell
TOUR Tuniu ADR 7.74 1.68  str.sell
MMYT MakeMyTrip 25.00 9.40  str.sell
TRIP TripAdvisor 40.48 36.72  hold
CEA China Eastern 24.91 19.50  sell

COMPANY NEWS

▶ 3 Stocks That Look Just Like Priceline in 1999   [Oct-18-17 02:00PM  Motley Fool]
▶ Ctrip.com Trying To Close In On Key Technical Measure   [Oct-05-17 03:00AM  Investor's Business Daily]
▶ [$$] Ctrip Hits Turbulence Despite Chinas Travel Boom   [Oct-04-17 12:34AM  The Wall Street Journal]
▶ Expedias Valuation: Whats Priced In?   [07:36AM  Market Realist]
▶ Ctrip CEO Sun Calls BRICs Buying Power Significant   [Sep-04-17 07:26PM  Bloomberg Video]
▶ Ctrip.Com beats Street 2Q forecasts   [Aug-31-17 08:03PM  Associated Press]
▶ Could TripAdvisors Leverage Rise in 2017?   [Aug-10-17 05:05PM  Market Realist]
▶ Alibaba & Marriott Form JV To Tap Millions of Travelers   [Aug-07-17 09:16AM  Barrons.com]
▶ Why Pricelines Second-Quarter Margin Is Expected to Fall   [Aug-04-17 09:09AM  Market Realist]
▶ Chinese stocks are getting slammed   [Aug-02-17 12:17PM  Yahoo Finance]
▶ Baidu Shares Surging on a Big Second Quarter   [Jul-31-17 10:55AM  Investopedia]
▶ Alibaba Gets The Buzz, But This Other Chinese Stock May Take Off   [Jul-27-17 04:15PM  Investor's Business Daily]
▶ [$$] Alibaba, JD Battle Pressures Margins   [Jul-20-17 11:08AM  Barrons.com]
▶ Chinese Tourism Giant Ctrip Looks to Go Global   [Jun-14-17 12:56AM  The Wall Street Journal]
▶ Why These 4 Tech Stocks May Beat Apple, Facebook   [Jun-13-17 06:15PM  Investopedia]
▶ Chinese Tourism Giant Ctrip Looks to Go Global   [01:59PM  The Wall Street Journal]
▶ [$$] Ctrip.com: We Can Grow at Home and Overseas   [Jun-09-17 05:18AM  The Wall Street Journal]
▶ [$$] 5 Tech Stocks for the Long Run   [Jun-06-17 07:26AM  Barrons.com]
▶ 3 Top Stocks for Your IRA in May   [01:04PM  Motley Fool]
▶ [$$] Chinese Travel Site Ctrip Looks to Tap Overseas Cash Stash for Deals   [May-12-17 12:53PM  The Wall Street Journal]
▶ Ctrip: Buy the Dip?   [May-11-17 11:19PM  Barrons.com]
▶ Ctrip.Com tops Street 1Q forecasts   [07:44PM  Associated Press]
▶ Ctrip International Falls Short On First-Quarter Earnings   [07:40PM  Investor's Business Daily]
▶ Top Chinese Internets Autohome, YY Earnings Top Views   [08:51AM  Investor's Business Daily]
▶ Will Snap, China's Internet Stocks Leap Like JD? Investing Action Plan   [May-09-17 04:43PM  Investor's Business Daily]
▶ MakeMyTrip Limited Announces $330 Million Equity Financing   [May-02-17 04:32PM  GlobeNewswire]
▶ 5 Consumer Service Stocks to Buy in 2017   [May-01-17 05:36PM  Motley Fool]
▶ Ctrip.com Is Soaring: Must-See Chart   [02:43PM  TheStreet.com]
▶ Ctrip Filed 2016 Annual Report on Form 20-F   [Apr-13-17 04:05PM  PR Newswire]
▶ How Analysts View Priceline in 2017 and Beyond   [Mar-08-17 07:36AM  Market Realist]
▶ 6 Things You Didn't Know About Baidu, Inc.   [Mar-06-17 01:37PM  Motley Fool]
▶ China Internet: Morgan Stanley's Top Picks For 2017   [Feb-23-17 07:57PM  at Barrons.com]
Financial statements of CTRP
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.