Intrinsic value of Equity Bancshares Cl A - EQBK

Previous Close

$42.41

  Intrinsic Value

$151.15

stock screener

  Rating & Target

str. buy

+256%

Previous close

$42.41

 
Intrinsic value

$151.15

 
Up/down potential

+256%

 
Rating

str. buy

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

We calculate the intrinsic value of EQBK 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
  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
  0
  157
  242
  362
  526
  742
  1,020
  1,369
  1,797
  2,312
  2,921
  3,627
  4,434
  5,345
  6,359
  7,477
  8,698
  10,019
  11,439
  12,955
  14,566
  16,268
  18,060
  19,941
  21,911
  23,967
  26,112
  28,345
  30,669
  33,086
  35,597
Variable operating expenses, $m
 
  86
  133
  199
  288
  406
  559
  750
  985
  1,267
  1,601
  1,988
  2,430
  2,929
  3,485
  4,097
  4,766
  5,490
  6,269
  7,099
  7,982
  8,915
  9,897
  10,928
  12,007
  13,134
  14,309
  15,533
  16,807
  18,131
  19,507
Fixed operating expenses, $m
 
  14
  15
  15
  15
  16
  16
  16
  17
  17
  17
  18
  18
  19
  19
  19
  20
  20
  21
  21
  22
  22
  23
  23
  24
  24
  25
  25
  26
  26
  27
Total operating expenses, $m
  0
  100
  148
  214
  303
  422
  575
  766
  1,002
  1,284
  1,618
  2,006
  2,448
  2,948
  3,504
  4,116
  4,786
  5,510
  6,290
  7,120
  8,004
  8,937
  9,920
  10,951
  12,031
  13,158
  14,334
  15,558
  16,833
  18,157
  19,534
Operating income, $m
  0
  57
  95
  149
  222
  320
  445
  602
  796
  1,028
  1,303
  1,622
  1,986
  2,397
  2,855
  3,360
  3,912
  4,508
  5,150
  5,835
  6,562
  7,331
  8,141
  8,990
  9,880
  10,809
  11,778
  12,787
  13,837
  14,928
  16,063
EBITDA, $m
  2
  483
  754
  1,135
  1,653
  2,339
  3,221
  4,328
  5,688
  7,324
  9,254
  11,496
  14,058
  16,948
  20,168
  23,717
  27,591
  31,785
  36,292
  41,105
  46,217
  51,620
  57,309
  63,281
  69,531
  76,060
  82,868
  89,958
  97,334
  105,004
  112,976
Interest expense (income), $m
  9
  153
  210
  312
  454
  648
  904
  1,233
  1,647
  2,155
  2,766
  3,487
  4,324
  5,281
  6,360
  7,562
  8,888
  10,335
  11,901
  13,584
  15,381
  17,290
  19,308
  21,432
  23,662
  25,997
  28,435
  30,977
  33,624
  36,379
  39,243
Earnings before tax, $m
  14
  -97
  -116
  -163
  -232
  -328
  -459
  -631
  -851
  -1,127
  -1,463
  -1,865
  -2,338
  -2,883
  -3,505
  -4,202
  -4,976
  -5,826
  -6,751
  -7,749
  -8,819
  -9,959
  -11,167
  -12,442
  -13,782
  -15,187
  -16,657
  -18,190
  -19,788
  -21,451
  -23,180
Tax expense, $m
  5
  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
  9
  -97
  -116
  -163
  -232
  -328
  -459
  -631
  -851
  -1,127
  -1,463
  -1,865
  -2,338
  -2,883
  -3,505
  -4,202
  -4,976
  -5,826
  -6,751
  -7,749
  -8,819
  -9,959
  -11,167
  -12,442
  -13,782
  -15,187
  -16,657
  -18,190
  -19,788
  -21,451
  -23,180

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
  2,192
  3,824
  5,909
  8,836
  12,821
  18,089
  24,868
  33,380
  43,830
  56,399
  71,236
  88,460
  108,150
  130,357
  155,100
  182,370
  212,140
  244,367
  279,000
  315,982
  355,257
  396,775
  440,492
  486,375
  534,403
  584,568
  636,878
  691,354
  748,032
  806,965
  868,219
Adjusted assets (=assets-cash), $m
  2,192
  3,824
  5,909
  8,836
  12,821
  18,089
  24,868
  33,380
  43,830
  56,399
  71,236
  88,460
  108,150
  130,357
  155,100
  182,370
  212,140
  244,367
  279,000
  315,982
  355,257
  396,775
  440,492
  486,375
  534,403
  584,568
  636,878
  691,354
  748,032
  806,965
  868,219
Revenue / Adjusted assets
  0.000
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
  0.041
Average production assets, $m
  49
  4,269
  6,595
  9,863
  14,311
  20,191
  27,758
  37,260
  48,925
  62,954
  79,516
  98,741
  120,720
  145,508
  173,126
  203,566
  236,796
  272,769
  311,427
  352,707
  396,547
  442,891
  491,689
  542,904
  596,514
  652,509
  710,899
  771,706
  834,972
  900,755
  969,127
Working capital, $m
  0
  -4,268
  -6,594
  -9,861
  -14,308
  -20,186
  -27,751
  -37,250
  -48,912
  -62,938
  -79,496
  -98,715
  -120,689
  -145,471
  -173,082
  -203,513
  -236,735
  -272,699
  -311,347
  -352,616
  -396,445
  -442,777
  -491,562
  -542,764
  -596,360
  -652,342
  -710,716
  -771,508
  -834,758
  -900,523
  -968,878
Total debt, $m
  34
  3,897
  5,773
  8,408
  11,994
  16,735
  22,836
  30,497
  39,902
  51,214
  64,568
  80,068
  97,790
  117,776
  140,044
  164,587
  191,380
  220,385
  251,555
  284,838
  320,186
  357,553
  396,898
  438,192
  481,417
  526,566
  573,645
  622,673
  673,684
  726,724
  781,852
Total liabilities, $m
  1,934
  3,442
  5,318
  7,953
  11,539
  16,280
  22,381
  30,042
  39,447
  50,759
  64,113
  79,614
  97,335
  117,322
  139,590
  164,133
  190,926
  219,930
  251,100
  284,384
  319,732
  357,098
  396,443
  437,738
  480,962
  526,111
  573,190
  622,218
  673,229
  726,269
  781,397
Total equity, $m
  258
  382
  591
  884
  1,282
  1,809
  2,487
  3,338
  4,383
  5,640
  7,124
  8,846
  10,815
  13,036
  15,510
  18,237
  21,214
  24,437
  27,900
  31,598
  35,526
  39,678
  44,049
  48,638
  53,440
  58,457
  63,688
  69,135
  74,803
  80,697
  86,822
Total liabilities and equity, $m
  2,192
  3,824
  5,909
  8,837
  12,821
  18,089
  24,868
  33,380
  43,830
  56,399
  71,237
  88,460
  108,150
  130,358
  155,100
  182,370
  212,140
  244,367
  279,000
  315,982
  355,258
  396,776
  440,492
  486,376
  534,402
  584,568
  636,878
  691,353
  748,032
  806,966
  868,219
Debt-to-equity ratio
  0.132
  10.190
  9.770
  9.510
  9.350
  9.250
  9.180
  9.140
  9.100
  9.080
  9.060
  9.050
  9.040
  9.030
  9.030
  9.020
  9.020
  9.020
  9.020
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
  9.010
Adjusted equity ratio
  0.118
  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
  9
  -97
  -116
  -163
  -232
  -328
  -459
  -631
  -851
  -1,127
  -1,463
  -1,865
  -2,338
  -2,883
  -3,505
  -4,202
  -4,976
  -5,826
  -6,751
  -7,749
  -8,819
  -9,959
  -11,167
  -12,442
  -13,782
  -15,187
  -16,657
  -18,190
  -19,788
  -21,451
  -23,180
Depreciation, amort., depletion, $m
  2
  427
  660
  986
  1,431
  2,019
  2,776
  3,726
  4,892
  6,295
  7,952
  9,874
  12,072
  14,551
  17,313
  20,357
  23,680
  27,277
  31,143
  35,271
  39,655
  44,289
  49,169
  54,290
  59,651
  65,251
  71,090
  77,171
  83,497
  90,075
  96,913
Funds from operations, $m
  14
  330
  544
  823
  1,199
  1,691
  2,317
  3,095
  4,041
  5,169
  6,489
  8,009
  9,734
  11,667
  13,808
  16,154
  18,703
  21,451
  24,392
  27,521
  30,835
  34,330
  38,002
  41,848
  45,869
  50,063
  54,433
  58,981
  63,710
  68,625
  73,733
Change in working capital, $m
  -2
  -1,600
  -2,326
  -3,267
  -4,447
  -5,878
  -7,565
  -9,499
  -11,662
  -14,026
  -16,558
  -19,220
  -21,974
  -24,782
  -27,611
  -30,432
  -33,222
  -35,964
  -38,648
  -41,270
  -43,829
  -46,331
  -48,785
  -51,202
  -53,596
  -55,981
  -58,374
  -60,792
  -63,250
  -65,766
  -68,355
Cash from operations, $m
  16
  1,931
  2,870
  4,091
  5,646
  7,569
  9,882
  12,594
  15,703
  19,195
  23,047
  27,229
  31,708
  36,449
  41,419
  46,586
  51,925
  57,414
  63,040
  68,791
  74,665
  80,661
  86,787
  93,051
  99,465
  106,045
  112,808
  119,773
  126,960
  134,391
  142,087
Maintenance CAPEX, $m
  0
  -268
  -427
  -660
  -986
  -1,431
  -2,019
  -2,776
  -3,726
  -4,892
  -6,295
  -7,952
  -9,874
  -12,072
  -14,551
  -17,313
  -20,357
  -23,680
  -27,277
  -31,143
  -35,271
  -39,655
  -44,289
  -49,169
  -54,290
  -59,651
  -65,251
  -71,090
  -77,171
  -83,497
  -90,075
New CAPEX, $m
  -3
  -1,588
  -2,327
  -3,268
  -4,448
  -5,880
  -7,567
  -9,501
  -11,665
  -14,029
  -16,562
  -19,225
  -21,979
  -24,788
  -27,618
  -30,439
  -33,230
  -35,973
  -38,658
  -41,280
  -43,840
  -46,343
  -48,798
  -51,215
  -53,610
  -55,996
  -58,389
  -60,807
  -63,266
  -65,783
  -68,372
Cash from investing activities, $m
  -141
  -1,856
  -2,754
  -3,928
  -5,434
  -7,311
  -9,586
  -12,277
  -15,391
  -18,921
  -22,857
  -27,177
  -31,853
  -36,860
  -42,169
  -47,752
  -53,587
  -59,653
  -65,935
  -72,423
  -79,111
  -85,998
  -93,087
  -100,384
  -107,900
  -115,647
  -123,640
  -131,897
  -140,437
  -149,280
  -158,447
Free cash flow, $m
  -125
  75
  117
  163
  212
  258
  296
  317
  312
  273
  189
  52
  -145
  -411
  -750
  -1,166
  -1,662
  -2,238
  -2,895
  -3,632
  -4,447
  -5,337
  -6,300
  -7,334
  -8,435
  -9,602
  -10,833
  -12,125
  -13,477
  -14,889
  -16,360
Issuance/(repayment) of debt, $m
  -28
  1,057
  1,876
  2,635
  3,586
  4,741
  6,101
  7,661
  9,405
  11,312
  13,354
  15,501
  17,722
  19,986
  22,268
  24,543
  26,793
  29,005
  31,170
  33,284
  35,348
  37,366
  39,345
  41,294
  43,225
  45,149
  47,079
  49,028
  51,011
  53,040
  55,128
Issuance/(repurchase) of shares, $m
  7
  482
  324
  456
  630
  855
  1,137
  1,482
  1,896
  2,383
  2,947
  3,587
  4,307
  5,104
  5,979
  6,929
  7,953
  9,049
  10,214
  11,448
  12,747
  14,111
  15,539
  17,030
  18,585
  20,204
  21,888
  23,637
  25,455
  27,344
  29,305
Cash from financing (excl. dividends), $m  
  103
  1,539
  2,200
  3,091
  4,216
  5,596
  7,238
  9,143
  11,301
  13,695
  16,301
  19,088
  22,029
  25,090
  28,247
  31,472
  34,746
  38,054
  41,384
  44,732
  48,095
  51,477
  54,884
  58,324
  61,810
  65,353
  68,967
  72,665
  76,466
  80,384
  84,433
Total cash flow (excl. dividends), $m
  -22
  1,614
  2,316
  3,254
  4,428
  5,854
  7,534
  9,460
  11,614
  13,968
  16,489
  19,141
  21,883
  24,680
  27,497
  30,306
  33,085
  35,815
  38,489
  41,099
  43,648
  46,140
  48,584
  50,991
  53,375
  55,750
  58,134
  60,541
  62,989
  65,494
  68,073
Retained Cash Flow (-), $m
  -91
  -482
  -324
  -456
  -630
  -855
  -1,137
  -1,482
  -1,896
  -2,383
  -2,947
  -3,587
  -4,307
  -5,104
  -5,979
  -6,929
  -7,953
  -9,049
  -10,214
  -11,448
  -12,747
  -14,111
  -15,539
  -17,030
  -18,585
  -20,204
  -21,888
  -23,637
  -25,455
  -27,344
  -29,305
Prev. year cash balance distribution, $m
 
  3
  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
  2
  3
  4
  6
  8
  11
  15
  20
  25
  32
  40
  49
  59
  70
  82
  96
  110
  126
  143
  160
  179
  199
  219
  241
  264
  287
  312
  337
  364
Cash available for distribution, $m
 
  1,135
  1,992
  2,798
  3,798
  4,999
  6,397
  7,978
  9,717
  11,585
  13,543
  15,553
  17,576
  19,575
  21,518
  23,377
  25,131
  26,767
  28,274
  29,652
  30,901
  32,029
  33,045
  33,961
  34,790
  35,546
  36,246
  36,904
  37,534
  38,151
  38,767
Discount rate, %
 
  11.80
  12.39
  13.01
  13.66
  14.34
  15.06
  15.81
  16.60
  17.43
  18.31
  19.22
  20.18
  21.19
  22.25
  23.36
  24.53
  25.76
  27.05
  28.40
  29.82
  31.31
  32.87
  34.52
  36.24
  38.06
  39.96
  41.96
  44.05
  46.26
  48.57
PV of cash for distribution, $m
 
  1,015
  1,577
  1,939
  2,276
  2,558
  2,757
  2,855
  2,843
  2,727
  2,521
  2,249
  1,936
  1,609
  1,292
  1,002
  751
  544
  380
  257
  167
  105
  64
  37
  21
  11
  6
  3
  1
  1
  0
Current shareholders' claim on cash, %
  100
  50.0
  27.1
  15.3
  8.9
  5.4
  3.3
  2.1
  1.3
  0.9
  0.6
  0.4
  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
  0.0
  0.0
  0.0

Equity Bancshares, Inc. is a bank holding company. The Company's principal activity is the ownership and management of its subsidiary, Equity Bank (the Bank). The Bank provides a range of financial services primarily to businesses and business owners, as well as individuals through its network of over 30 branches located in Kansas and Missouri. The Company's operations involve the delivery of loan and deposit products to its customers. The Company offers commercial banking products and other services, including lending activities, deposit products, and other products and services. It offers a suite of online banking solutions, including access to account balances, online transfers, online bill payment, and electronic delivery of customer statements and mobile banking solutions. In addition, the Company offers commercial treasury management services, wire transfer, automated clearing house (ACH) services and cash management deposit products.

FINANCIAL RATIOS  of  Equity Bancshares Cl A (EQBK)

Valuation Ratios
P/E Ratio 55
Price to Sales 0
Price to Book 1.9
Price to Tangible Book
Price to Cash Flow 31
Price to Free Cash Flow 38.1
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -50%
Cap. Spend. - 3 Yr. Gr. Rate 8.4%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 13.2%
Total Debt to Equity 13.2%
Interest Coverage 3
Management Effectiveness
Return On Assets 0.8%
Ret/ On Assets - 3 Yr. Avg. 1%
Return On Total Capital 3.7%
Ret/ On T. Cap. - 3 Yr. Avg. 5%
Return On Equity 4.2%
Return On Equity - 3 Yr. Avg. 6.1%
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 35.7%
Eff/ Tax Rate - 3 Yr. Avg. 31.7%
Payout Ratio 0%

EQBK stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the EQBK stock intrinsic value calculation we used $98 million for the last fiscal year's total revenue generated by Equity Bancshares Cl A. The default revenue input number comes from 2016 income statement of Equity Bancshares Cl A. 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 EQBK 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 11.8%, whose default value for EQBK is calculated based on our internal credit rating of Equity Bancshares Cl A, 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 Equity Bancshares Cl A.
    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 EQBK stock the variable cost ratio is equal to 54.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $14 million in the base year in the intrinsic value calculation for EQBK 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 Equity Bancshares Cl A.

Corporate tax rate of 27% is the nominal tax rate for Equity Bancshares Cl A. 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 EQBK 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 EQBK are equal to 2722.5%.

Life of production assets of 10 years is the average useful life of capital assets used in Equity Bancshares Cl A 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 EQBK is equal to -2721.8%. 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 Equity Bancshares Cl A - 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 12 million for Equity Bancshares Cl A 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 Equity Bancshares Cl A at the current share price and the inputted number of shares is $0.5 billion.

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COMPANY NEWS

▶ Bank CEO: Growth 'well worth the effort'   [Jul-20-18 11:40AM  American City Business Journals]
▶ Equity sets net income record in 2Q   [Jul-19-18 06:19PM  American City Business Journals]
▶ Equity Bancshares: 2Q Earnings Snapshot   [05:23PM  Associated Press]
▶ Behind the deal: How Equity's purchase of Oklahoma bank originated   [Jun-13-18 03:46PM  American City Business Journals]
▶ Bank closes on sixth, seventh transactions in three years   [May-08-18 03:21PM  American City Business Journals]
▶ Bank CEO: Organization not done growing   [Apr-20-18 02:47PM  American City Business Journals]
▶ Equity Bancshares: 1Q Earnings Snapshot   [Apr-19-18 04:16PM  Associated Press]
▶ Equity Bank gets merger approvals   [Mar-27-18 05:01PM  American City Business Journals]
▶ Equity Bank adds a familiar name to its executive team   [Mar-21-18 04:57PM  American City Business Journals]
▶ Top NasdaqGS High Growth Stock   [Mar-08-18 11:02AM  Simply Wall St.]
▶ Equity Bancshares posts 4Q profit   [Jan-26-18 06:48AM  Associated Press]
▶ Earnings Preview: Equity Bancshares   [11:20AM  Benzinga]
▶ Equity Bancshares posts 3Q profit   [Oct-19-17 04:59PM  Associated Press]
▶ Equity Bancshares posts 2Q profit   [Jul-20-17 10:05PM  Associated Press]
▶ Equity Bank creates executive position focused on M&A   [May-22-17 02:05PM  American City Business Journals]
▶ Equity Bancshares posts 1Q profit   [Apr-20-17 04:40PM  Associated Press]
▶ Equity sets March closing for 11th acquisition   [12:25PM  at bizjournals.com]
▶ Equity sets March closing for 11th acquisition   [12:25PM  American City Business Journals]
▶ Equity BancShares Inc (EQBK): Is It A Good Stock to Buy?   [Dec-15-16 06:35PM  at Insider Monkey]
Financial statements of EQBK
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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