Intrinsic value of Entergy - ETR

Previous Close

$77.84

  Intrinsic Value

$10.87

stock screener

  Rating & Target

str. sell

-86%

  Value-price divergence*

-75%

Previous close

$77.84

 
Intrinsic value

$10.87

 
Up/down potential

-86%

 
Rating

str. sell

 
Value-price divergence*

-75%

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

We calculate the intrinsic value of ETR 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 14.2

 

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, %
  -5.79
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  8,996
  11,063
  11,317
  11,608
  11,935
  12,297
  12,694
  13,126
  13,594
  14,098
  14,639
  15,218
  15,835
  16,493
  17,192
  17,934
  18,719
  19,551
  20,431
  21,361
  22,342
  23,378
  24,470
  25,621
  26,834
  28,112
  29,457
  30,872
  32,362
  33,929
  35,578
Variable operating expenses, $m
 
  2,267
  2,318
  2,377
  2,443
  2,516
  2,596
  2,683
  2,777
  2,879
  2,988
  3,067
  3,191
  3,324
  3,465
  3,614
  3,772
  3,940
  4,117
  4,305
  4,502
  4,711
  4,931
  5,163
  5,408
  5,665
  5,936
  6,222
  6,522
  6,838
  7,170
Fixed operating expenses, $m
 
  9,928
  10,176
  10,431
  10,692
  10,959
  11,233
  11,514
  11,801
  12,096
  12,399
  12,709
  13,027
  13,352
  13,686
  14,028
  14,379
  14,738
  15,107
  15,485
  15,872
  16,268
  16,675
  17,092
  17,519
  17,957
  18,406
  18,866
  19,338
  19,822
  20,317
Total operating expenses, $m
  11,732
  12,195
  12,494
  12,808
  13,135
  13,475
  13,829
  14,197
  14,578
  14,975
  15,387
  15,776
  16,218
  16,676
  17,151
  17,642
  18,151
  18,678
  19,224
  19,790
  20,374
  20,979
  21,606
  22,255
  22,927
  23,622
  24,342
  25,088
  25,860
  26,660
  27,487
Operating income, $m
  -886
  -1,132
  -1,177
  -1,200
  -1,200
  -1,178
  -1,135
  -1,071
  -985
  -877
  -748
  -558
  -382
  -183
  41
  291
  568
  873
  1,207
  1,571
  1,968
  2,398
  2,864
  3,366
  3,907
  4,489
  5,114
  5,784
  6,502
  7,270
  8,091
EBITDA, $m
  1,237
  -1,095
  -1,140
  -1,162
  -1,162
  -1,140
  -1,097
  -1,033
  -947
  -840
  -710
  -558
  -382
  -183
  41
  291
  568
  873
  1,207
  1,571
  1,968
  2,398
  2,864
  3,366
  3,907
  4,489
  5,114
  5,784
  6,502
  7,270
  8,091
Interest expense (income), $m
  747
  739
  774
  818
  868
  924
  987
  1,056
  1,130
  1,211
  1,299
  1,392
  1,492
  1,599
  1,713
  1,834
  1,962
  2,098
  2,242
  2,394
  2,555
  2,724
  2,903
  3,092
  3,291
  3,501
  3,722
  3,955
  4,199
  4,457
  4,728
Earnings before tax, $m
  -1,382
  -1,872
  -1,951
  -2,017
  -2,068
  -2,102
  -2,122
  -2,126
  -2,115
  -2,089
  -2,046
  -1,950
  -1,875
  -1,782
  -1,671
  -1,542
  -1,394
  -1,225
  -1,035
  -822
  -586
  -326
  -40
  274
  616
  988
  1,392
  1,830
  2,303
  2,813
  3,363
Tax expense, $m
  -817
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  74
  166
  267
  376
  494
  622
  760
  908
Net income, $m
  -565
  -1,872
  -1,951
  -2,017
  -2,068
  -2,102
  -2,122
  -2,126
  -2,115
  -2,089
  -2,046
  -1,950
  -1,875
  -1,782
  -1,671
  -1,542
  -1,394
  -1,225
  -1,035
  -822
  -586
  -326
  -40
  200
  449
  721
  1,016
  1,336
  1,681
  2,054
  2,455

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,188
  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
  45,904
  45,526
  46,574
  47,770
  49,114
  50,603
  52,237
  54,016
  55,942
  58,016
  60,243
  62,625
  65,167
  67,873
  70,749
  73,801
  77,035
  80,458
  84,079
  87,904
  91,943
  96,205
  100,699
  105,437
  110,428
  115,685
  121,221
  127,047
  133,177
  139,627
  146,411
Adjusted assets (=assets-cash), $m
  44,716
  45,526
  46,574
  47,770
  49,114
  50,603
  52,237
  54,016
  55,942
  58,016
  60,243
  62,625
  65,167
  67,873
  70,749
  73,801
  77,035
  80,458
  84,079
  87,904
  91,943
  96,205
  100,699
  105,437
  110,428
  115,685
  121,221
  127,047
  133,177
  139,627
  146,411
Revenue / Adjusted assets
  0.201
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
  0.243
Average production assets, $m
  -18,551
  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
Working capital, $m
  484
  77
  79
  81
  84
  86
  89
  92
  95
  99
  102
  107
  111
  115
  120
  126
  131
  137
  143
  150
  156
  164
  171
  179
  188
  197
  206
  216
  227
  238
  249
Total debt, $m
  15,275
  15,170
  16,033
  17,019
  18,126
  19,353
  20,699
  22,165
  23,752
  25,462
  27,296
  29,259
  31,353
  33,583
  35,953
  38,468
  41,133
  43,954
  46,937
  50,089
  53,417
  56,929
  60,632
  64,536
  68,649
  72,981
  77,542
  82,342
  87,394
  92,709
  98,299
Total liabilities, $m
  37,619
  37,514
  38,377
  39,363
  40,470
  41,697
  43,043
  44,509
  46,096
  47,806
  49,640
  51,603
  53,697
  55,927
  58,297
  60,812
  63,477
  66,298
  69,281
  72,433
  75,761
  79,273
  82,976
  86,880
  90,993
  95,325
  99,886
  104,686
  109,738
  115,053
  120,643
Total equity, $m
  8,285
  8,013
  8,197
  8,408
  8,644
  8,906
  9,194
  9,507
  9,846
  10,211
  10,603
  11,022
  11,469
  11,946
  12,452
  12,989
  13,558
  14,161
  14,798
  15,471
  16,182
  16,932
  17,723
  18,557
  19,435
  20,361
  21,335
  22,360
  23,439
  24,574
  25,768
Total liabilities and equity, $m
  45,904
  45,527
  46,574
  47,771
  49,114
  50,603
  52,237
  54,016
  55,942
  58,017
  60,243
  62,625
  65,166
  67,873
  70,749
  73,801
  77,035
  80,459
  84,079
  87,904
  91,943
  96,205
  100,699
  105,437
  110,428
  115,686
  121,221
  127,046
  133,177
  139,627
  146,411
Debt-to-equity ratio
  1.844
  1.890
  1.960
  2.020
  2.100
  2.170
  2.250
  2.330
  2.410
  2.490
  2.570
  2.650
  2.730
  2.810
  2.890
  2.960
  3.030
  3.100
  3.170
  3.240
  3.300
  3.360
  3.420
  3.480
  3.530
  3.580
  3.630
  3.680
  3.730
  3.770
  3.810
Adjusted equity ratio
  0.168
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176
  0.176

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -565
  -1,872
  -1,951
  -2,017
  -2,068
  -2,102
  -2,122
  -2,126
  -2,115
  -2,089
  -2,046
  -1,950
  -1,875
  -1,782
  -1,671
  -1,542
  -1,394
  -1,225
  -1,035
  -822
  -586
  -326
  -40
  200
  449
  721
  1,016
  1,336
  1,681
  2,054
  2,455
Depreciation, amort., depletion, $m
  2,123
  38
  38
  38
  38
  38
  38
  38
  38
  38
  38
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Funds from operations, $m
  2,440
  -1,834
  -1,913
  -1,980
  -2,030
  -2,065
  -2,084
  -2,089
  -2,078
  -2,051
  -2,009
  -1,950
  -1,875
  -1,782
  -1,671
  -1,542
  -1,394
  -1,225
  -1,035
  -822
  -586
  -326
  -40
  200
  449
  721
  1,016
  1,336
  1,681
  2,054
  2,455
Change in working capital, $m
  -559
  2
  2
  2
  2
  3
  3
  3
  3
  4
  4
  4
  4
  5
  5
  5
  6
  6
  6
  7
  7
  7
  8
  8
  8
  9
  9
  10
  10
  11
  12
Cash from operations, $m
  2,999
  -1,835
  -1,915
  -1,982
  -2,032
  -2,067
  -2,087
  -2,092
  -2,081
  -2,054
  -2,012
  -1,954
  -1,879
  -1,787
  -1,676
  -1,547
  -1,399
  -1,231
  -1,041
  -829
  -593
  -333
  -47
  192
  441
  712
  1,007
  1,326
  1,671
  2,043
  2,443
Maintenance CAPEX, $m
  0
  1,855
  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
New CAPEX, $m
  -4,044
  -18,551
  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 investing activities, $m
  -3,850
  -16,696
  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
Free cash flow, $m
  -851
  -18,531
  -1,915
  -1,982
  -2,032
  -2,067
  -2,087
  -2,092
  -2,081
  -2,054
  -2,012
  -1,954
  -1,879
  -1,787
  -1,676
  -1,547
  -1,399
  -1,231
  -1,041
  -829
  -593
  -333
  -47
  192
  441
  712
  1,007
  1,326
  1,671
  2,043
  2,443
Issuance/(repayment) of debt, $m
  1,410
  677
  863
  986
  1,107
  1,227
  1,346
  1,466
  1,587
  1,710
  1,835
  1,963
  2,094
  2,230
  2,370
  2,515
  2,665
  2,821
  2,983
  3,152
  3,328
  3,512
  3,703
  3,904
  4,113
  4,332
  4,561
  4,801
  5,052
  5,315
  5,590
Issuance/(repurchase) of shares, $m
  -82
  2,005
  2,135
  2,228
  2,304
  2,364
  2,410
  2,439
  2,454
  2,454
  2,438
  2,369
  2,322
  2,258
  2,178
  2,079
  1,963
  1,827
  1,672
  1,496
  1,297
  1,076
  831
  634
  429
  204
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  1,321
  2,682
  2,998
  3,214
  3,411
  3,591
  3,756
  3,905
  4,041
  4,164
  4,273
  4,332
  4,416
  4,488
  4,548
  4,594
  4,628
  4,648
  4,655
  4,648
  4,625
  4,588
  4,534
  4,538
  4,542
  4,536
  4,561
  4,801
  5,052
  5,315
  5,590
Total cash flow (excl. dividends), $m
  470
  -15,849
  1,083
  1,233
  1,379
  1,524
  1,669
  1,814
  1,960
  2,109
  2,260
  2,378
  2,537
  2,702
  2,871
  3,047
  3,229
  3,418
  3,614
  3,819
  4,032
  4,255
  4,487
  4,729
  4,983
  5,248
  5,568
  6,127
  6,722
  7,357
  8,033
Retained Cash Flow (-), $m
  1,290
  -2,005
  -2,135
  -2,228
  -2,304
  -2,364
  -2,410
  -2,439
  -2,454
  -2,454
  -2,438
  -2,369
  -2,322
  -2,258
  -2,178
  -2,079
  -1,963
  -1,827
  -1,672
  -1,496
  -1,297
  -1,076
  -831
  -834
  -879
  -925
  -974
  -1,025
  -1,079
  -1,135
  -1,194
Prev. year cash balance distribution, $m
 
  406
  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
 
  -2,005
  -1,052
  -995
  -925
  -840
  -741
  -626
  -494
  -345
  -178
  9
  215
  443
  694
  967
  1,266
  1,590
  1,942
  2,323
  2,735
  3,178
  3,656
  3,896
  4,105
  4,323
  4,594
  5,101
  5,643
  6,222
  6,839
Discount rate, %
 
  8.40
  8.82
  9.26
  9.72
  10.21
  10.72
  11.26
  11.82
  12.41
  13.03
  13.68
  14.37
  15.09
  15.84
  16.63
  17.46
  18.34
  19.25
  20.22
  21.23
  22.29
  23.40
  24.57
  25.80
  27.09
  28.45
  29.87
  31.36
  32.93
  34.58
PV of cash for distribution, $m
 
  -1,850
  -889
  -763
  -638
  -517
  -402
  -297
  -202
  -120
  -52
  2
  43
  71
  89
  96
  96
  91
  82
  70
  58
  46
  36
  25
  17
  11
  7
  4
  3
  2
  1
Current shareholders' claim on cash, %
  100
  87.0
  75.3
  65.0
  56.0
  48.3
  41.7
  36.1
  31.3
  27.4
  24.0
  21.2
  18.9
  16.9
  15.3
  13.9
  12.8
  11.9
  11.1
  10.5
  10.0
  9.6
  9.4
  9.2
  9.0
  9.0
  9.0
  9.0
  9.0
  9.0
  9.0

Entergy Corporation, together with its subsidiaries, engages in the generation and distribution of electricity in the United States. It operates in two segments, Utility and Entergy Wholesale Commodities. The Utility segment generates, transmits, distributes, and sells electric power in portions of Arkansas, Mississippi, Texas, and Louisiana, including the City of New Orleans; and distributes natural gas. The Entergy Wholesale Commodities segment is engaged in the ownership, operation, and decommissioning of nuclear power plants located in the northern United States; sells the electric power to wholesale customers; offers services to other nuclear power plant owners; and owns interests in non-nuclear power plants that sell the electric power to wholesale customers. This segment sells energy to retail power providers, utilities, electric power co-operatives, power trading organizations, and other power generation companies. It generates electricity through gas/oil, nuclear, coal, wind, and hydro power. The company’s power plants have approximately 30,000 megawatts (MW) of aggregate electric generating capacity, including approximately 10,000 MW of nuclear-fueled capacity. It delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi, and Texas. The company was founded in 1989 and is based in New Orleans, Louisiana.

FINANCIAL RATIOS  of  Entergy (ETR)

Valuation Ratios
P/E Ratio -24.7
Price to Sales 1.3
Price to Book 1.7
Price to Tangible Book
Price to Cash Flow 4.6
Price to Free Cash Flow -13.3
Growth Rates
Sales Growth Rate -5.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 35.1%
Cap. Spend. - 3 Yr. Gr. Rate 7.5%
Financial Strength
Quick Ratio 2
Current Ratio 0.2
LT Debt to Equity 174.9%
Total Debt to Equity 184.4%
Interest Coverage -1
Management Effectiveness
Return On Assets -0.6%
Ret/ On Assets - 3 Yr. Avg. 0.8%
Return On Total Capital -2.4%
Ret/ On T. Cap. - 3 Yr. Avg. 0.3%
Return On Equity -6.3%
Return On Equity - 3 Yr. Avg. 0.5%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 13.7%
EBITDA Margin - 3 Yr. Avg. 21.8%
Operating Margin -8.2%
Oper. Margin - 3 Yr. Avg. 1.8%
Pre-Tax Margin -12.7%
Pre-Tax Margin - 3 Yr. Avg. -2.4%
Net Profit Margin -5.2%
Net Profit Margin - 3 Yr. Avg. 0.4%
Effective Tax Rate 59.1%
Eff/ Tax Rate - 3 Yr. Avg. 59.2%
Payout Ratio -112%

ETR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ETR stock intrinsic value calculation we used $10846 million for the last fiscal year's total revenue generated by Entergy. The default revenue input number comes from 2016 income statement of Entergy. 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 ETR stock valuation model: a) initial revenue growth rate of 2% 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 8.4%, whose default value for ETR is calculated based on our internal credit rating of Entergy, 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 Entergy.
    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 ETR stock the variable cost ratio is equal to 20.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $9686 million in the base year in the intrinsic value calculation for ETR 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 5.1% for Entergy.

Corporate tax rate of 27% is the nominal tax rate for Entergy. 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 ETR 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 ETR are equal to 0%.

Life of production assets of 10 years is the average useful life of capital assets used in Entergy 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 ETR is equal to 0.7%. 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 - $8285 million for Entergy - 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 181.926 million for Entergy 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 Entergy at the current share price and the inputted number of shares is $14.2 billion.

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COMPANY NEWS

▶ Why Utility Implied Volatility Matters   [Aug-14-17 10:37AM  Market Realist]
▶ Are the Top-Yielding Utilities Really Worth the Risk?   [Aug-10-17 05:53PM  Market Realist]
▶ Entergy beats 2Q profit forecasts   [Aug-02-17 10:59PM  Associated Press]
▶ Entergy Reports Second Quarter Earnings   [06:30AM  PR Newswire]
▶ Entergy Declares Dividend   [Jul-28-17 02:21PM  PR Newswire]
▶ ETFs with exposure to Entergy Corp. : July 24, 2017   [Jul-24-17 03:48PM  Capital Cube]
▶ Whats Next for FirstEnergy Stock?   [Jul-21-17 07:46AM  Market Realist]
▶ What Dominion Energys Chart Indicators Imply   [Jul-18-17 07:37AM  Market Realist]
▶ EXC, FE, D, and ETR: A Look at Utilities Generation Mixes   [Jul-17-17 07:39AM  Market Realist]
▶ Entergy Corp. Value Analysis (NYSE:ETR) : July 3, 2017   [Jul-03-17 04:25PM  Capital Cube]
▶ Correction: Vermont Yankee story   [Jun-29-17 03:08PM  Associated Press]
▶ Entergy: Cramer's Top Takeaways   [Jun-24-17 06:23AM  TheStreet.com]
▶ Entergy CEO: Leaving Paris accord doesn't change much   [Jun-23-17 07:16PM  CNBC Videos]
▶ [$$] Cuomo Is Right to Close Indian Point Plant   [May-25-17 12:38AM  The Wall Street Journal]
▶ [$$] Cuomo Is Right to Close Indian Point Plant   [May-24-17 01:40PM  The Wall Street Journal]
▶ [$$] Cuomos Nuclear Short Circuit   [12:10AM  The Wall Street Journal]
▶ [$$] Cuomo's Nuclear Short Circuit   [May-18-17 07:36PM  The Wall Street Journal]
▶ Here Are Some of Congress' Favorite Stocks   [May-15-17 12:42PM  TheStreet.com]
▶ ETFs with exposure to Entergy Corp. : May 11, 2017   [May-11-17 04:38PM  Capital Cube]
▶ Entergy misses 1Q profit forecasts   [07:34AM  Associated Press]
▶ Entergy Reports First Quarter Earnings   [06:30AM  PR Newswire]
▶ Entergy Announces First Quarter Earnings Conference Call   [Apr-19-17 05:16PM  PR Newswire]
▶ Entergy Declares Dividend   [03:00PM  PR Newswire]
▶ Ripples from US nuclear plant closings overwhelm small towns   [Mar-26-17 01:54PM  Associated Press]
Stock chart of ETR Financial statements of ETR
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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