Intrinsic value of Golar LNG - GLNG

Previous Close

$22.39

  Intrinsic Value

$4.56

stock screener

  Rating & Target

str. sell

-80%

  Value-price divergence*

-6%

Previous close

$22.39

 
Intrinsic value

$4.56

 
Up/down potential

-80%

 
Rating

str. sell

 
Value-price divergence*

-6%

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

We calculate the intrinsic value of GLNG 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 2.3

 

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, %
  -22.33
  31.60
  28.94
  26.55
  24.39
  22.45
  20.71
  19.14
  17.72
  16.45
  15.31
  14.27
  13.35
  12.51
  11.76
  11.09
  10.48
  9.93
  9.44
  8.99
  8.59
  8.23
  7.91
  7.62
  7.36
  7.12
  6.91
  6.72
  6.55
  6.39
  6.25
Revenue, $m
  80
  105
  136
  172
  214
  262
  316
  376
  443
  516
  595
  680
  770
  867
  969
  1,076
  1,189
  1,307
  1,430
  1,559
  1,693
  1,832
  1,977
  2,128
  2,284
  2,447
  2,616
  2,792
  2,975
  3,165
  3,363
Variable operating expenses, $m
 
  158
  204
  258
  321
  392
  474
  564
  664
  774
  892
  1,020
  1,156
  1,300
  1,453
  1,614
  1,783
  1,960
  2,145
  2,338
  2,539
  2,748
  2,966
  3,192
  3,427
  3,671
  3,924
  4,188
  4,462
  4,747
  5,044
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
  229
  158
  204
  258
  321
  392
  474
  564
  664
  774
  892
  1,020
  1,156
  1,300
  1,453
  1,614
  1,783
  1,960
  2,145
  2,338
  2,539
  2,748
  2,966
  3,192
  3,427
  3,671
  3,924
  4,188
  4,462
  4,747
  5,044
Operating income, $m
  -149
  -53
  -68
  -86
  -107
  -131
  -158
  -188
  -221
  -258
  -297
  -340
  -385
  -433
  -484
  -538
  -594
  -653
  -715
  -779
  -846
  -916
  -989
  -1,064
  -1,142
  -1,224
  -1,308
  -1,396
  -1,487
  -1,582
  -1,681
EBITDA, $m
  -76
  67
  86
  109
  136
  166
  201
  239
  282
  328
  378
  432
  490
  551
  616
  684
  756
  831
  909
  991
  1,076
  1,165
  1,257
  1,353
  1,452
  1,556
  1,663
  1,775
  1,891
  2,012
  2,138
Interest expense (income), $m
  25
  54
  77
  106
  140
  179
  225
  276
  333
  395
  464
  538
  618
  704
  794
  890
  991
  1,098
  1,209
  1,325
  1,446
  1,572
  1,703
  1,840
  1,982
  2,129
  2,282
  2,441
  2,607
  2,779
  2,958
Earnings before tax, $m
  -209
  -107
  -145
  -192
  -247
  -310
  -383
  -464
  -554
  -653
  -761
  -878
  -1,003
  -1,137
  -1,279
  -1,428
  -1,586
  -1,751
  -1,924
  -2,104
  -2,292
  -2,488
  -2,692
  -2,904
  -3,124
  -3,353
  -3,590
  -3,837
  -4,094
  -4,361
  -4,639
Tax expense, $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
Net income, $m
  -187
  -107
  -145
  -192
  -247
  -310
  -383
  -464
  -554
  -653
  -761
  -878
  -1,003
  -1,137
  -1,279
  -1,428
  -1,586
  -1,751
  -1,924
  -2,104
  -2,292
  -2,488
  -2,692
  -2,904
  -3,124
  -3,353
  -3,590
  -3,837
  -4,094
  -4,361
  -4,639

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  224
  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
  4,257
  5,264
  6,787
  8,589
  10,684
  13,083
  15,792
  18,814
  22,149
  25,792
  29,740
  33,985
  38,521
  43,341
  48,439
  53,808
  59,445
  65,348
  71,514
  77,945
  84,643
  91,613
  98,860
  106,392
  114,220
  122,355
  130,809
  139,597
  148,737
  158,244
  168,139
Adjusted assets (=assets-cash), $m
  4,033
  5,264
  6,787
  8,589
  10,684
  13,083
  15,792
  18,814
  22,149
  25,792
  29,740
  33,985
  38,521
  43,341
  48,439
  53,808
  59,445
  65,348
  71,514
  77,945
  84,643
  91,613
  98,860
  106,392
  114,220
  122,355
  130,809
  139,597
  148,737
  158,244
  168,139
Revenue / Adjusted assets
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
  0.020
Average production assets, $m
  2,726
  3,587
  4,626
  5,854
  7,281
  8,916
  10,762
  12,822
  15,094
  17,577
  20,268
  23,161
  26,252
  29,537
  33,011
  36,670
  40,512
  44,535
  48,737
  53,120
  57,684
  62,434
  67,373
  72,506
  77,841
  83,385
  89,146
  95,136
  101,364
  107,843
  114,587
Working capital, $m
  -277
  -66
  -85
  -107
  -134
  -164
  -197
  -235
  -277
  -322
  -372
  -425
  -482
  -542
  -605
  -673
  -743
  -817
  -894
  -974
  -1,058
  -1,145
  -1,236
  -1,330
  -1,428
  -1,529
  -1,635
  -1,745
  -1,859
  -1,978
  -2,102
Total debt, $m
  1,772
  2,210
  3,030
  3,999
  5,126
  6,417
  7,874
  9,500
  11,294
  13,254
  15,378
  17,662
  20,102
  22,696
  25,438
  28,327
  31,360
  34,535
  37,853
  41,312
  44,916
  48,666
  52,564
  56,617
  60,828
  65,205
  69,753
  74,481
  79,398
  84,513
  89,837
Total liabilities, $m
  2,394
  2,832
  3,652
  4,621
  5,748
  7,039
  8,496
  10,122
  11,916
  13,876
  16,000
  18,284
  20,724
  23,318
  26,060
  28,949
  31,982
  35,157
  38,475
  41,934
  45,538
  49,288
  53,186
  57,239
  61,450
  65,827
  70,375
  75,103
  80,020
  85,135
  90,459
Total equity, $m
  1,863
  2,432
  3,136
  3,968
  4,936
  6,044
  7,296
  8,692
  10,233
  11,916
  13,740
  15,701
  17,797
  20,024
  22,379
  24,859
  27,464
  30,191
  33,040
  36,011
  39,105
  42,325
  45,673
  49,153
  52,770
  56,528
  60,434
  64,494
  68,716
  73,109
  77,680
Total liabilities and equity, $m
  4,257
  5,264
  6,788
  8,589
  10,684
  13,083
  15,792
  18,814
  22,149
  25,792
  29,740
  33,985
  38,521
  43,342
  48,439
  53,808
  59,446
  65,348
  71,515
  77,945
  84,643
  91,613
  98,859
  106,392
  114,220
  122,355
  130,809
  139,597
  148,736
  158,244
  168,139
Debt-to-equity ratio
  0.951
  0.910
  0.970
  1.010
  1.040
  1.060
  1.080
  1.090
  1.100
  1.110
  1.120
  1.120
  1.130
  1.130
  1.140
  1.140
  1.140
  1.140
  1.150
  1.150
  1.150
  1.150
  1.150
  1.150
  1.150
  1.150
  1.150
  1.150
  1.160
  1.160
  1.160
Adjusted equity ratio
  0.406
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462
  0.462

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -187
  -107
  -145
  -192
  -247
  -310
  -383
  -464
  -554
  -653
  -761
  -878
  -1,003
  -1,137
  -1,279
  -1,428
  -1,586
  -1,751
  -1,924
  -2,104
  -2,292
  -2,488
  -2,692
  -2,904
  -3,124
  -3,353
  -3,590
  -3,837
  -4,094
  -4,361
  -4,639
Depreciation, amort., depletion, $m
  73
  120
  154
  195
  243
  297
  359
  427
  503
  586
  676
  772
  875
  985
  1,100
  1,222
  1,350
  1,484
  1,625
  1,771
  1,923
  2,081
  2,246
  2,417
  2,595
  2,779
  2,972
  3,171
  3,379
  3,595
  3,820
Funds from operations, $m
  -27
  13
  9
  3
  -4
  -13
  -24
  -36
  -51
  -67
  -86
  -106
  -128
  -152
  -178
  -206
  -235
  -267
  -299
  -334
  -370
  -407
  -446
  -487
  -529
  -573
  -619
  -666
  -715
  -767
  -820
Change in working capital, $m
  12
  -16
  -19
  -23
  -26
  -30
  -34
  -38
  -42
  -46
  -49
  -53
  -57
  -60
  -64
  -67
  -70
  -74
  -77
  -80
  -84
  -87
  -91
  -94
  -98
  -102
  -106
  -110
  -114
  -119
  -124
Cash from operations, $m
  -39
  29
  28
  26
  22
  17
  10
  1
  -9
  -22
  -36
  -53
  -72
  -92
  -115
  -139
  -165
  -193
  -222
  -253
  -286
  -320
  -356
  -393
  -431
  -471
  -513
  -556
  -601
  -648
  -696
Maintenance CAPEX, $m
  0
  -91
  -120
  -154
  -195
  -243
  -297
  -359
  -427
  -503
  -586
  -676
  -772
  -875
  -985
  -1,100
  -1,222
  -1,350
  -1,484
  -1,625
  -1,771
  -1,923
  -2,081
  -2,246
  -2,417
  -2,595
  -2,779
  -2,972
  -3,171
  -3,379
  -3,595
New CAPEX, $m
  -235
  -861
  -1,038
  -1,228
  -1,428
  -1,635
  -1,846
  -2,060
  -2,272
  -2,483
  -2,690
  -2,893
  -3,091
  -3,285
  -3,474
  -3,659
  -3,842
  -4,022
  -4,202
  -4,383
  -4,565
  -4,750
  -4,939
  -5,133
  -5,335
  -5,544
  -5,762
  -5,989
  -6,228
  -6,479
  -6,743
Cash from investing activities, $m
  -2
  -952
  -1,158
  -1,382
  -1,623
  -1,878
  -2,143
  -2,419
  -2,699
  -2,986
  -3,276
  -3,569
  -3,863
  -4,160
  -4,459
  -4,759
  -5,064
  -5,372
  -5,686
  -6,008
  -6,336
  -6,673
  -7,020
  -7,379
  -7,752
  -8,139
  -8,541
  -8,961
  -9,399
  -9,858
  -10,338
Free cash flow, $m
  -41
  -924
  -1,130
  -1,356
  -1,601
  -1,861
  -2,133
  -2,417
  -2,709
  -3,008
  -3,313
  -3,622
  -3,935
  -4,252
  -4,573
  -4,899
  -5,229
  -5,566
  -5,909
  -6,260
  -6,621
  -6,992
  -7,376
  -7,772
  -8,183
  -8,610
  -9,054
  -9,517
  -10,001
  -10,506
  -11,034
Issuance/(repayment) of debt, $m
  134
  662
  820
  969
  1,127
  1,291
  1,458
  1,626
  1,794
  1,960
  2,124
  2,284
  2,440
  2,593
  2,742
  2,889
  3,033
  3,175
  3,317
  3,460
  3,604
  3,750
  3,899
  4,053
  4,211
  4,376
  4,548
  4,728
  4,917
  5,115
  5,323
Issuance/(repurchase) of shares, $m
  163
  676
  849
  1,024
  1,215
  1,419
  1,634
  1,860
  2,094
  2,337
  2,585
  2,839
  3,099
  3,364
  3,634
  3,909
  4,190
  4,478
  4,773
  5,075
  5,387
  5,708
  6,040
  6,384
  6,740
  7,111
  7,496
  7,898
  8,316
  8,754
  9,211
Cash from financing (excl. dividends), $m  
  214
  1,338
  1,669
  1,993
  2,342
  2,710
  3,092
  3,486
  3,888
  4,297
  4,709
  5,123
  5,539
  5,957
  6,376
  6,798
  7,223
  7,653
  8,090
  8,535
  8,991
  9,458
  9,939
  10,437
  10,951
  11,487
  12,044
  12,626
  13,233
  13,869
  14,534
Total cash flow (excl. dividends), $m
  173
  414
  539
  637
  741
  849
  958
  1,069
  1,179
  1,289
  1,396
  1,502
  1,604
  1,705
  1,803
  1,899
  1,994
  2,088
  2,181
  2,275
  2,369
  2,465
  2,563
  2,664
  2,769
  2,877
  2,990
  3,109
  3,233
  3,363
  3,500
Retained Cash Flow (-), $m
  32
  -676
  -849
  -1,024
  -1,215
  -1,419
  -1,634
  -1,860
  -2,094
  -2,337
  -2,585
  -2,839
  -3,099
  -3,364
  -3,634
  -3,909
  -4,190
  -4,478
  -4,773
  -5,075
  -5,387
  -5,708
  -6,040
  -6,384
  -6,740
  -7,111
  -7,496
  -7,898
  -8,316
  -8,754
  -9,211
Prev. year cash balance distribution, $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 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
 
  -262
  -310
  -387
  -474
  -570
  -676
  -791
  -915
  -1,048
  -1,189
  -1,338
  -1,495
  -1,659
  -1,831
  -2,010
  -2,196
  -2,390
  -2,592
  -2,801
  -3,018
  -3,243
  -3,477
  -3,719
  -3,971
  -4,233
  -4,506
  -4,789
  -5,084
  -5,391
  -5,711
Discount rate, %
 
  9.10
  9.56
  10.03
  10.53
  11.06
  11.61
  12.19
  12.80
  13.44
  14.12
  14.82
  15.56
  16.34
  17.16
  18.02
  18.92
  19.86
  20.86
  21.90
  23.00
  24.15
  25.35
  26.62
  27.95
  29.35
  30.82
  32.36
  33.97
  35.67
  37.46
PV of cash for distribution, $m
 
  -240
  -258
  -291
  -317
  -337
  -350
  -353
  -349
  -337
  -317
  -292
  -263
  -232
  -199
  -167
  -137
  -110
  -86
  -65
  -48
  -35
  -24
  -16
  -11
  -7
  -4
  -2
  -1
  -1
  0
Current shareholders' claim on cash, %
  100
  77.2
  60.1
  47.5
  38.0
  30.8
  25.3
  20.9
  17.5
  14.7
  12.5
  10.7
  9.2
  8.0
  7.0
  6.1
  5.4
  4.7
  4.2
  3.7
  3.3
  3.0
  2.7
  2.4
  2.2
  1.9
  1.8
  1.6
  1.4
  1.3
  1.2

Golar LNG Limited is a midstream liquefied natural gas (LNG) company engaged primarily in the transportation, regasification, liquefaction and trading of LNG. The Company is engaged in the acquisition, ownership, operation and chartering of LNG carriers and Floating Storage Regasification Unit (FSRUs) through its subsidiaries and affiliates, and the development of LNG projects, such as floating LNGs (FLNGs). The Company's segments include Vessel operations, LNG trading and FLNG. Under the Vessel operations segment, the Company operates and charters out LNG carriers and FSRUs on fixed terms to customers. Through the LNG trading segment, the Company provides physical and financial risk management in LNG and gas markets for customers around the world. The FLNG segment includes the costs associated with the conversion of its LNG carrier, the Hilli, to a FLNG. The Company, along with its affiliate, Golar LNG Partners LP, has a combined fleet of approximately 30 vessels.

FINANCIAL RATIOS  of  Golar LNG (GLNG)

Valuation Ratios
P/E Ratio -12.1
Price to Sales 28.3
Price to Book 1.2
Price to Tangible Book
Price to Cash Flow -58
Price to Free Cash Flow -8.3
Growth Rates
Sales Growth Rate -22.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -66.3%
Cap. Spend. - 3 Yr. Gr. Rate -20.4%
Financial Strength
Quick Ratio 0
Current Ratio 0.5
LT Debt to Equity 70.9%
Total Debt to Equity 95.1%
Interest Coverage -7
Management Effectiveness
Return On Assets -3.8%
Ret/ On Assets - 3 Yr. Avg. -2.7%
Return On Total Capital -5.1%
Ret/ On T. Cap. - 3 Yr. Avg. -3.8%
Return On Equity -10%
Return On Equity - 3 Yr. Avg. -6.9%
Asset Turnover 0
Profitability Ratios
Gross Margin -25%
Gross Margin - 3 Yr. Avg. -6.7%
EBITDA Margin -138.8%
EBITDA Margin - 3 Yr. Avg. -87.4%
Operating Margin -186.3%
Oper. Margin - 3 Yr. Avg. -79.2%
Pre-Tax Margin -261.3%
Pre-Tax Margin - 3 Yr. Avg. -183.7%
Net Profit Margin -233.8%
Net Profit Margin - 3 Yr. Avg. -148.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0.8%
Payout Ratio -28.9%

GLNG stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the GLNG stock intrinsic value calculation we used $80 million for the last fiscal year's total revenue generated by Golar LNG. The default revenue input number comes from 2016 income statement of Golar LNG. 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 GLNG stock valuation model: a) initial revenue growth rate of 31.6% 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 9.1%, whose default value for GLNG is calculated based on our internal credit rating of Golar LNG, 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 Golar LNG.
    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 GLNG stock the variable cost ratio is equal to 150%.

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 GLNG 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 Golar LNG.

Corporate tax rate of 27% is the nominal tax rate for Golar LNG. 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 GLNG 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 GLNG are equal to 3407.5%.

Life of production assets of 37.3 years is the average useful life of capital assets used in Golar LNG 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 GLNG is equal to -62.5%. 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 - $1863 million for Golar LNG - 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 102.23 million for Golar LNG 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 Golar LNG at the current share price and the inputted number of shares is $2.3 billion.

RELATED COMPANIES Price Int.Val. Rating
GMLP Golar LNG Part 23.06 13.63  sell
GLOG GasLog 17.80 2.88  str.sell
DLNG Dynagas LNG Pa 13.50 10.42  sell
TGP Teekay LNG Par 18.35 4.91  str.sell
TK Teekay 8.82 11.07  hold
HMLP Hoegh LNG Part 19.20 119.53  str.buy
FRO Frontline 6.30 2.22  str.sell
TNK Teekay Tankers 1.68 5.03  str.buy

COMPANY NEWS

▶ FLNG Hilli Episeyo departs Singapore   [Oct-12-17 12:21PM  GlobeNewswire]
▶ Where Bunker Fuel Prices Are Headed in Week 40   [Oct-11-17 03:06PM  Market Realist]
▶ Bunker Fuel Prices Rose, Oil Hit a 2-Year High in Week 39   [Oct-03-17 05:06PM  Market Realist]
▶ FLNG Hilli Episeyo departs Keppel Shipyard   [Oct-02-17 05:01AM  GlobeNewswire]
▶ Crude and Bunker Fuel Prices Rose in Week 38   [Sep-28-17 10:39AM  Market Realist]
▶ Golar LNG Limited: 2017 AGM results notification   [Sep-27-17 06:36PM  GlobeNewswire]
▶ "Fast Money" final trades: GM, XOM and more   [Sep-26-17 05:59PM  CNBC Videos]
▶ Organisational Changes at Golar   [03:01AM  GlobeNewswire]
▶ ETFs with exposure to Golar LNG Ltd. : September 13, 2017   [Sep-13-17 06:21PM  Capital Cube]
▶ Golar LNG reports 2Q loss   [Aug-31-17 08:04PM  Associated Press]
▶ Golar LNG dividend information   [Aug-30-17 09:01AM  GlobeNewswire]
▶ Golar LNG Limited: Fortuna FLNG Offtake Awarded to Gunvor   [Aug-21-17 08:02AM  GlobeNewswire]
▶ Crude Oil and Bunker Fuel Prices Went This Way Last Week   [Aug-18-17 02:36PM  Market Realist]
▶ 3 Oil & Gas Stocks for Ambitious Investors   [Aug-06-17 07:05AM  Motley Fool]
▶ Week 30: Bunker Fuel Prices Rose Due to Higher Oil Prices   [Aug-04-17 11:35AM  Market Realist]
▶ ETFs with exposure to Golar LNG Ltd. : July 5, 2017   [Jul-05-17 12:44PM  Capital Cube]
▶ 2017 Annual General Meeting   [08:13AM  GlobeNewswire]
▶ Why Bunker Fuel Prices Are on a Downward Trend   [Jun-28-17 07:38AM  Market Realist]
▶ Today's Bell Ringer, June 20, 2017   [Jun-20-17 09:15AM  CNBC Videos]
▶ ETFs with exposure to Golar LNG Ltd. : June 16, 2017   [Jun-16-17 03:50PM  Capital Cube]
▶ Why LNG Transport Firms' Stock Prices Sank in May   [Jun-09-17 04:21PM  Motley Fool]
▶ Why Did Bunker Fuel Prices Fall in Week 22?   [Jun-07-17 10:37AM  Market Realist]
▶ ETFs with exposure to Golar LNG Ltd. : June 5, 2017   [Jun-05-17 02:19PM  Capital Cube]
▶ How Did Bunker Fuel Prices Trend in Week 21?   [09:08AM  Market Realist]
▶ Golar LNG reports 1Q loss   [May-31-17 05:08PM  Associated Press]
▶ Golar LNG dividend information   [08:37AM  GlobeNewswire]
▶ Four stocks that will float your portfolio's boat   [May-26-17 05:24PM  CNBC Videos]
▶ Golar LNG Limited - Q1 2017 results presentation   [May-23-17 04:31PM  GlobeNewswire]
▶ Bunker Fuel Prices Rose in Week 19   [10:39AM  Market Realist]
▶ 3 Hidden Gems in the Oil Sector   [May-09-17 08:11AM  Motley Fool]
▶ ETFs with exposure to Golar LNG Ltd. : April 7, 2017   [Apr-07-17 04:39PM  Capital Cube]
▶ Why Analysts Expect Exponential Growth for Golar LNG   [Mar-31-17 03:35PM  Market Realist]
▶ Why Tesla, SeaWorld, Netflix, and More Are Trending   [Mar-17-17 08:56AM  Insider Monkey]
▶ Final Trade: WMT, DXJ & more   [Mar-02-17 05:59PM  CNBC Videos]
▶ Bunker Fuel Prices Rose in Week 8   [Mar-01-17 09:06AM  Market Realist]
▶ Golar LNG Dividend Information   [09:32AM  GlobeNewswire]
▶ Golar LNG Dividend Information   [09:31AM  GlobeNewswire]
Financial statements of GLNG
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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