Intrinsic value of Fibria Celulose ADR - FBR

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$10.02

  Intrinsic Value

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  Value-price divergence*

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$10.02

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

We calculate the intrinsic value of FBR 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 5.5

 

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, %
  -4.61
  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
  3,040
  9,807
  10,033
  10,291
  10,580
  10,901
  11,253
  11,636
  12,051
  12,498
  12,978
  13,491
  14,038
  14,621
  15,241
  15,898
  16,595
  17,332
  18,112
  18,936
  19,806
  20,724
  21,693
  22,713
  23,788
  24,921
  26,113
  27,368
  28,689
  30,078
  31,540
Variable operating expenses, $m
 
  6,366
  6,503
  6,659
  6,835
  7,029
  7,242
  7,475
  7,726
  7,997
  8,287
  8,175
  8,507
  8,861
  9,236
  9,634
  10,057
  10,504
  10,976
  11,476
  12,003
  12,559
  13,146
  13,764
  14,416
  15,102
  15,825
  16,585
  17,386
  18,228
  19,113
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
  2,589
  6,366
  6,503
  6,659
  6,835
  7,029
  7,242
  7,475
  7,726
  7,997
  8,287
  8,175
  8,507
  8,861
  9,236
  9,634
  10,057
  10,504
  10,976
  11,476
  12,003
  12,559
  13,146
  13,764
  14,416
  15,102
  15,825
  16,585
  17,386
  18,228
  19,113
Operating income, $m
  451
  3,441
  3,530
  3,631
  3,746
  3,872
  4,011
  4,162
  4,325
  4,501
  4,690
  5,315
  5,531
  5,761
  6,005
  6,264
  6,538
  6,829
  7,136
  7,461
  7,804
  8,165
  8,547
  8,949
  9,373
  9,819
  10,288
  10,783
  11,303
  11,851
  12,427
EBITDA, $m
  1,078
  5,461
  5,587
  5,731
  5,892
  6,070
  6,266
  6,480
  6,711
  6,960
  7,227
  7,512
  7,817
  8,142
  8,487
  8,853
  9,241
  9,652
  10,086
  10,545
  11,029
  11,541
  12,080
  12,648
  13,247
  13,878
  14,542
  15,240
  15,976
  16,750
  17,563
Interest expense (income), $m
  34
  525
  540
  557
  575
  596
  619
  644
  672
  702
  734
  769
  806
  845
  887
  932
  979
  1,029
  1,083
  1,139
  1,198
  1,261
  1,327
  1,397
  1,470
  1,548
  1,629
  1,715
  1,806
  1,901
  2,001
Earnings before tax, $m
  962
  2,916
  2,990
  3,075
  3,170
  3,276
  3,391
  3,517
  3,653
  3,799
  3,956
  4,547
  4,725
  4,915
  5,118
  5,332
  5,559
  5,799
  6,054
  6,322
  6,605
  6,905
  7,220
  7,552
  7,902
  8,271
  8,659
  9,068
  9,498
  9,950
  10,426
Tax expense, $m
  436
  787
  807
  830
  856
  885
  916
  950
  986
  1,026
  1,068
  1,228
  1,276
  1,327
  1,382
  1,440
  1,501
  1,566
  1,634
  1,707
  1,783
  1,864
  1,949
  2,039
  2,134
  2,233
  2,338
  2,448
  2,564
  2,686
  2,815
Net income, $m
  523
  2,128
  2,182
  2,245
  2,314
  2,391
  2,476
  2,567
  2,667
  2,773
  2,888
  3,319
  3,449
  3,588
  3,736
  3,892
  4,058
  4,234
  4,419
  4,615
  4,822
  5,040
  5,270
  5,513
  5,769
  6,038
  6,321
  6,619
  6,933
  7,263
  7,611

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,484
  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
  10,889
  30,363
  31,062
  31,860
  32,756
  33,749
  34,839
  36,025
  37,309
  38,693
  40,178
  41,767
  43,462
  45,267
  47,185
  49,220
  51,377
  53,661
  56,075
  58,626
  61,320
  64,162
  67,160
  70,319
  73,648
  77,155
  80,846
  84,732
  88,821
  93,122
  97,647
Adjusted assets (=assets-cash), $m
  9,405
  30,363
  31,062
  31,860
  32,756
  33,749
  34,839
  36,025
  37,309
  38,693
  40,178
  41,767
  43,462
  45,267
  47,185
  49,220
  51,377
  53,661
  56,075
  58,626
  61,320
  64,162
  67,160
  70,319
  73,648
  77,155
  80,846
  84,732
  88,821
  93,122
  97,647
Revenue / Adjusted assets
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
  0.323
Average production assets, $m
  5,000
  16,133
  16,504
  16,928
  17,404
  17,932
  18,511
  19,141
  19,824
  20,559
  21,348
  22,192
  23,093
  24,052
  25,071
  26,152
  27,299
  28,512
  29,795
  31,150
  32,581
  34,092
  35,684
  37,363
  39,132
  40,995
  42,956
  45,021
  47,194
  49,479
  51,883
Working capital, $m
  1,105
  -284
  -291
  -298
  -307
  -316
  -326
  -337
  -349
  -362
  -376
  -391
  -407
  -424
  -442
  -461
  -481
  -503
  -525
  -549
  -574
  -601
  -629
  -659
  -690
  -723
  -757
  -794
  -832
  -872
  -915
Total debt, $m
  5,038
  15,437
  15,901
  16,432
  17,028
  17,688
  18,413
  19,202
  20,056
  20,976
  21,963
  23,020
  24,147
  25,347
  26,623
  27,976
  29,411
  30,929
  32,535
  34,232
  36,023
  37,913
  39,906
  42,007
  44,221
  46,553
  49,008
  51,592
  54,311
  57,171
  60,180
Total liabilities, $m
  6,541
  20,192
  20,656
  21,187
  21,783
  22,443
  23,168
  23,957
  24,811
  25,731
  26,718
  27,775
  28,902
  30,102
  31,378
  32,731
  34,166
  35,684
  37,290
  38,987
  40,778
  42,668
  44,661
  46,762
  48,976
  51,308
  53,763
  56,347
  59,066
  61,926
  64,935
Total equity, $m
  4,348
  10,172
  10,406
  10,673
  10,973
  11,306
  11,671
  12,068
  12,499
  12,962
  13,460
  13,992
  14,560
  15,164
  15,807
  16,489
  17,211
  17,976
  18,785
  19,640
  20,542
  21,494
  22,499
  23,557
  24,672
  25,847
  27,083
  28,385
  29,755
  31,196
  32,712
Total liabilities and equity, $m
  10,889
  30,364
  31,062
  31,860
  32,756
  33,749
  34,839
  36,025
  37,310
  38,693
  40,178
  41,767
  43,462
  45,266
  47,185
  49,220
  51,377
  53,660
  56,075
  58,627
  61,320
  64,162
  67,160
  70,319
  73,648
  77,155
  80,846
  84,732
  88,821
  93,122
  97,647
Debt-to-equity ratio
  1.159
  1.520
  1.530
  1.540
  1.550
  1.560
  1.580
  1.590
  1.600
  1.620
  1.630
  1.650
  1.660
  1.670
  1.680
  1.700
  1.710
  1.720
  1.730
  1.740
  1.750
  1.760
  1.770
  1.780
  1.790
  1.800
  1.810
  1.820
  1.830
  1.830
  1.840
Adjusted equity ratio
  0.305
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  523
  2,128
  2,182
  2,245
  2,314
  2,391
  2,476
  2,567
  2,667
  2,773
  2,888
  3,319
  3,449
  3,588
  3,736
  3,892
  4,058
  4,234
  4,419
  4,615
  4,822
  5,040
  5,270
  5,513
  5,769
  6,038
  6,321
  6,619
  6,933
  7,263
  7,611
Depreciation, amort., depletion, $m
  627
  2,020
  2,057
  2,099
  2,146
  2,198
  2,256
  2,318
  2,386
  2,459
  2,537
  2,197
  2,286
  2,381
  2,482
  2,589
  2,703
  2,823
  2,950
  3,084
  3,226
  3,375
  3,533
  3,699
  3,874
  4,059
  4,253
  4,458
  4,673
  4,899
  5,137
Funds from operations, $m
  1,307
  4,149
  4,239
  4,344
  4,461
  4,590
  4,732
  4,886
  5,052
  5,232
  5,424
  5,516
  5,736
  5,970
  6,218
  6,482
  6,761
  7,057
  7,369
  7,699
  8,048
  8,416
  8,804
  9,212
  9,643
  10,097
  10,574
  11,077
  11,606
  12,162
  12,748
Change in working capital, $m
  66
  -6
  -7
  -7
  -8
  -9
  -10
  -11
  -12
  -13
  -14
  -15
  -16
  -17
  -18
  -19
  -20
  -21
  -23
  -24
  -25
  -27
  -28
  -30
  -31
  -33
  -35
  -36
  -38
  -40
  -42
Cash from operations, $m
  1,241
  6,144
  4,246
  4,351
  4,469
  4,599
  4,742
  4,897
  5,064
  5,245
  5,438
  5,531
  5,752
  5,987
  6,236
  6,501
  6,781
  7,078
  7,392
  7,723
  8,073
  8,442
  8,832
  9,242
  9,674
  10,130
  10,609
  11,113
  11,644
  12,203
  12,790
Maintenance CAPEX, $m
  0
  -1,566
  -1,597
  -1,634
  -1,676
  -1,723
  -1,775
  -1,833
  -1,895
  -1,963
  -2,036
  -2,114
  -2,197
  -2,286
  -2,381
  -2,482
  -2,589
  -2,703
  -2,823
  -2,950
  -3,084
  -3,226
  -3,375
  -3,533
  -3,699
  -3,874
  -4,059
  -4,253
  -4,458
  -4,673
  -4,899
New CAPEX, $m
  -1,925
  -319
  -371
  -424
  -476
  -528
  -579
  -630
  -682
  -735
  -789
  -844
  -901
  -959
  -1,019
  -1,081
  -1,146
  -1,213
  -1,283
  -1,356
  -1,431
  -1,510
  -1,593
  -1,679
  -1,769
  -1,863
  -1,961
  -2,065
  -2,173
  -2,286
  -2,404
Cash from investing activities, $m
  -2,172
  -1,885
  -1,968
  -2,058
  -2,152
  -2,251
  -2,354
  -2,463
  -2,577
  -2,698
  -2,825
  -2,958
  -3,098
  -3,245
  -3,400
  -3,563
  -3,735
  -3,916
  -4,106
  -4,306
  -4,515
  -4,736
  -4,968
  -5,212
  -5,468
  -5,737
  -6,020
  -6,318
  -6,631
  -6,959
  -7,303
Free cash flow, $m
  -931
  4,259
  2,278
  2,293
  2,317
  2,348
  2,387
  2,434
  2,487
  2,547
  2,614
  2,573
  2,654
  2,741
  2,836
  2,937
  3,046
  3,162
  3,286
  3,418
  3,558
  3,706
  3,864
  4,030
  4,206
  4,392
  4,588
  4,796
  5,014
  5,244
  5,487
Issuance/(repayment) of debt, $m
  1,579
  423
  464
  531
  596
  660
  725
  789
  854
  920
  987
  1,056
  1,127
  1,200
  1,276
  1,354
  1,434
  1,518
  1,606
  1,697
  1,791
  1,890
  1,993
  2,101
  2,214
  2,332
  2,455
  2,584
  2,719
  2,861
  3,009
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  
  1,578
  423
  464
  531
  596
  660
  725
  789
  854
  920
  987
  1,056
  1,127
  1,200
  1,276
  1,354
  1,434
  1,518
  1,606
  1,697
  1,791
  1,890
  1,993
  2,101
  2,214
  2,332
  2,455
  2,584
  2,719
  2,861
  3,009
Total cash flow (excl. dividends), $m
  597
  4,682
  2,742
  2,824
  2,913
  3,009
  3,112
  3,223
  3,341
  3,467
  3,601
  3,630
  3,781
  3,941
  4,111
  4,291
  4,480
  4,680
  4,892
  5,114
  5,349
  5,596
  5,857
  6,131
  6,420
  6,724
  7,043
  7,380
  7,733
  8,105
  8,496
Retained Cash Flow (-), $m
  -316
  -194
  -234
  -267
  -300
  -333
  -365
  -397
  -430
  -464
  -497
  -532
  -568
  -605
  -643
  -682
  -723
  -765
  -809
  -855
  -902
  -952
  -1,004
  -1,058
  -1,115
  -1,175
  -1,237
  -1,302
  -1,370
  -1,441
  -1,516
Prev. year cash balance distribution, $m
 
  3,773
  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
 
  8,261
  2,508
  2,556
  2,613
  2,676
  2,747
  2,825
  2,911
  3,004
  3,104
  3,098
  3,213
  3,337
  3,469
  3,609
  3,758
  3,915
  4,083
  4,260
  4,447
  4,644
  4,853
  5,073
  5,305
  5,549
  5,807
  6,078
  6,363
  6,664
  6,980
Discount rate, %
 
  6.20
  6.51
  6.84
  7.18
  7.54
  7.91
  8.31
  8.72
  9.16
  9.62
  10.10
  10.60
  11.13
  11.69
  12.28
  12.89
  13.53
  14.21
  14.92
  15.67
  16.45
  17.27
  18.14
  19.04
  20.00
  21.00
  22.05
  23.15
  24.30
  25.52
PV of cash for distribution, $m
 
  7,779
  2,211
  2,096
  1,980
  1,861
  1,739
  1,616
  1,491
  1,365
  1,239
  1,075
  959
  846
  738
  635
  540
  453
  373
  303
  242
  190
  146
  110
  81
  58
  41
  28
  19
  12
  8
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

Fibria Celulose S.A. produces, sells, and exports short fiber pulp in Brazil and internationally. It primarily offers bleached eucalyptus kraft pulp. The company has approximately 969 thousand hectares of forest base in the states of São Paulo, Minas Gerais, Rio de Janeiro, Espírito Santo, Mato Grosso do Sul, and Bahia. It has strategic alliance with Ensyn Corporation. The company was formerly known as Votorantim Celulose e Papel S.A. and changed its name to Fibria Celulose S.A. in November 2009. Fibria Celulose S.A. was founded in 1988 and is headquartered in São Paulo, Brazil.

FINANCIAL RATIOS  of  Fibria Celulose ADR (FBR)

Valuation Ratios
P/E Ratio 10.6
Price to Sales 1.8
Price to Book 1.3
Price to Tangible Book
Price to Cash Flow 4.5
Price to Free Cash Flow -8.1
Growth Rates
Sales Growth Rate -4.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 158.4%
Cap. Spend. - 3 Yr. Gr. Rate 38.6%
Financial Strength
Quick Ratio 5
Current Ratio 0.1
LT Debt to Equity 109.2%
Total Debt to Equity 115.9%
Interest Coverage 29
Management Effectiveness
Return On Assets 5.4%
Ret/ On Assets - 3 Yr. Avg. 6.7%
Return On Total Capital 6%
Ret/ On T. Cap. - 3 Yr. Avg. 2.7%
Return On Equity 12.5%
Return On Equity - 3 Yr. Avg. 5.4%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 26.1%
Gross Margin - 3 Yr. Avg. 29.8%
EBITDA Margin 53.4%
EBITDA Margin - 3 Yr. Avg. 34.6%
Operating Margin 14.8%
Oper. Margin - 3 Yr. Avg. 24.4%
Pre-Tax Margin 31.6%
Pre-Tax Margin - 3 Yr. Avg. 10.1%
Net Profit Margin 17.2%
Net Profit Margin - 3 Yr. Avg. 7.6%
Effective Tax Rate 45.3%
Eff/ Tax Rate - 3 Yr. Avg. -87.2%
Payout Ratio 18.5%

FBR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the FBR stock intrinsic value calculation we used $9615 million for the last fiscal year's total revenue generated by Fibria Celulose ADR. The default revenue input number comes from 2016 income statement of Fibria Celulose 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 FBR 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 6.2%, whose default value for FBR is calculated based on our internal credit rating of Fibria Celulose 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 Fibria Celulose 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 FBR stock the variable cost ratio is equal to 65%.

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 FBR 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 Fibria Celulose ADR.

Corporate tax rate of 27% is the nominal tax rate for Fibria Celulose 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 FBR 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 FBR are equal to 164.5%.

Life of production assets of 10.1 years is the average useful life of capital assets used in Fibria Celulose 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 FBR is equal to -2.9%. 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 - $13751 million for Fibria Celulose 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 547.506 million for Fibria Celulose 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 Fibria Celulose ADR at the current share price and the inputted number of shares is $5.5 billion.


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COMPANY NEWS

▶ "Fast Money' final trades: OLN, TGT & more   [May-18-17 05:59PM  CNBC Videos]
▶ ETFs with exposure to Fibria Celulose SA : May 3, 2017   [May-03-17 03:56PM  Capital Cube]
▶ Fibria Celulose posts 1Q profit   [08:14AM  Associated Press]
▶ ETFs with exposure to Fibria Celulose SA : April 5, 2017   [Apr-05-17 04:45PM  Capital Cube]
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Stock chart of FBR Financial statements of FBR Annual reports of FBR
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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