Intrinsic value of Hanwha Q CELLS ADR - HQCL

Previous Close

$7.46

  Intrinsic Value

$64.11

stock screener

  Rating & Target

str. buy

+759%

  Value-price divergence*

-47%

Previous close

$7.46

 
Intrinsic value

$64.11

 
Up/down potential

+759%

 
Rating

str. buy

 
Value-price divergence*

-47%

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

We calculate the intrinsic value of HQCL 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 0.6

 

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, %
  34.70
  34.70
  31.73
  29.06
  26.65
  24.49
  22.54
  20.78
  19.21
  17.78
  16.51
  15.36
  14.32
  13.39
  12.55
  11.79
  11.11
  10.50
  9.95
  9.46
  9.01
  8.61
  8.25
  7.92
  7.63
  7.37
  7.13
  6.92
  6.73
  6.55
  6.40
Revenue, $m
  2,426
  3,268
  4,305
  5,556
  7,036
  8,759
  10,733
  12,964
  15,454
  18,202
  21,206
  24,463
  27,966
  31,710
  35,690
  39,899
  44,334
  48,990
  53,866
  58,961
  64,274
  69,809
  75,568
  81,557
  87,781
  94,250
  100,972
  107,958
  115,221
  122,773
  130,629
Variable operating expenses, $m
 
  2,928
  3,857
  4,978
  6,304
  7,848
  9,617
  11,615
  13,846
  16,308
  19,000
  21,918
  25,056
  28,411
  31,976
  35,748
  39,721
  43,893
  48,262
  52,827
  57,587
  62,546
  67,706
  73,071
  78,648
  84,444
  90,467
  96,726
  103,233
  109,999
  117,038
Fixed operating expenses, $m
 
  64
  65
  67
  68
  70
  72
  74
  76
  77
  79
  81
  83
  85
  88
  90
  92
  94
  97
  99
  102
  104
  107
  109
  112
  115
  118
  121
  124
  127
  130
Total operating expenses, $m
  2,234
  2,992
  3,922
  5,045
  6,372
  7,918
  9,689
  11,689
  13,922
  16,385
  19,079
  21,999
  25,139
  28,496
  32,064
  35,838
  39,813
  43,987
  48,359
  52,926
  57,689
  62,650
  67,813
  73,180
  78,760
  84,559
  90,585
  96,847
  103,357
  110,126
  117,168
Operating income, $m
  192
  276
  383
  511
  664
  841
  1,045
  1,275
  1,532
  1,816
  2,127
  2,464
  2,826
  3,214
  3,626
  4,061
  4,520
  5,003
  5,508
  6,035
  6,586
  7,159
  7,755
  8,376
  9,021
  9,691
  10,387
  11,111
  11,864
  12,647
  13,461
EBITDA, $m
  286
  403
  549
  726
  936
  1,180
  1,460
  1,777
  2,131
  2,521
  2,948
  3,411
  3,909
  4,442
  5,008
  5,606
  6,237
  6,900
  7,594
  8,318
  9,075
  9,862
  10,682
  11,534
  12,420
  13,341
  14,297
  15,292
  16,326
  17,401
  18,519
Interest expense (income), $m
  55
  38
  62
  92
  128
  170
  219
  275
  339
  410
  488
  574
  666
  766
  873
  986
  1,106
  1,233
  1,366
  1,505
  1,650
  1,801
  1,959
  2,123
  2,294
  2,471
  2,656
  2,847
  3,046
  3,253
  3,469
Earnings before tax, $m
  123
  238
  320
  419
  536
  671
  826
  1,000
  1,193
  1,407
  1,639
  1,890
  2,160
  2,447
  2,753
  3,075
  3,414
  3,770
  4,142
  4,531
  4,936
  5,358
  5,796
  6,253
  6,727
  7,220
  7,732
  8,264
  8,818
  9,393
  9,992
Tax expense, $m
  -5
  64
  86
  113
  145
  181
  223
  270
  322
  380
  442
  510
  583
  661
  743
  830
  922
  1,018
  1,118
  1,223
  1,333
  1,447
  1,565
  1,688
  1,816
  1,949
  2,088
  2,231
  2,381
  2,536
  2,698
Net income, $m
  128
  174
  234
  306
  391
  490
  603
  730
  871
  1,027
  1,196
  1,380
  1,577
  1,787
  2,009
  2,245
  2,492
  2,752
  3,024
  3,307
  3,603
  3,911
  4,231
  4,564
  4,911
  5,270
  5,644
  6,033
  6,437
  6,857
  7,294

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  390
  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
  2,209
  2,450
  3,227
  4,165
  5,274
  6,566
  8,046
  9,718
  11,584
  13,645
  15,897
  18,338
  20,964
  23,771
  26,754
  29,909
  33,234
  36,724
  40,380
  44,199
  48,182
  52,331
  56,648
  61,137
  65,803
  70,652
  75,691
  80,928
  86,372
  92,033
  97,923
Adjusted assets (=assets-cash), $m
  1,819
  2,450
  3,227
  4,165
  5,274
  6,566
  8,046
  9,718
  11,584
  13,645
  15,897
  18,338
  20,964
  23,771
  26,754
  29,909
  33,234
  36,724
  40,380
  44,199
  48,182
  52,331
  56,648
  61,137
  65,803
  70,652
  75,691
  80,928
  86,372
  92,033
  97,923
Revenue / Adjusted assets
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
  1.334
Average production assets, $m
  883
  1,189
  1,567
  2,022
  2,561
  3,188
  3,907
  4,719
  5,625
  6,626
  7,719
  8,904
  10,180
  11,542
  12,991
  14,523
  16,137
  17,832
  19,607
  21,462
  23,396
  25,410
  27,507
  29,687
  31,952
  34,307
  36,754
  39,297
  41,940
  44,689
  47,549
Working capital, $m
  222
  484
  637
  822
  1,041
  1,296
  1,588
  1,919
  2,287
  2,694
  3,139
  3,621
  4,139
  4,693
  5,282
  5,905
  6,561
  7,251
  7,972
  8,726
  9,513
  10,332
  11,184
  12,070
  12,992
  13,949
  14,944
  15,978
  17,053
  18,170
  19,333
Total debt, $m
  1,172
  1,272
  1,875
  2,603
  3,464
  4,466
  5,615
  6,912
  8,360
  9,959
  11,707
  13,601
  15,639
  17,817
  20,132
  22,581
  25,160
  27,869
  30,706
  33,669
  36,760
  39,980
  43,330
  46,813
  50,434
  54,197
  58,107
  62,171
  66,396
  70,789
  75,359
Total liabilities, $m
  1,801
  1,901
  2,504
  3,232
  4,093
  5,095
  6,244
  7,541
  8,989
  10,588
  12,336
  14,230
  16,268
  18,446
  20,761
  23,210
  25,789
  28,498
  31,335
  34,298
  37,389
  40,609
  43,959
  47,442
  51,063
  54,826
  58,736
  62,800
  67,025
  71,418
  75,988
Total equity, $m
  408
  549
  723
  933
  1,181
  1,471
  1,802
  2,177
  2,595
  3,056
  3,561
  4,108
  4,696
  5,325
  5,993
  6,700
  7,444
  8,226
  9,045
  9,900
  10,793
  11,722
  12,689
  13,695
  14,740
  15,826
  16,955
  18,128
  19,347
  20,615
  21,935
Total liabilities and equity, $m
  2,209
  2,450
  3,227
  4,165
  5,274
  6,566
  8,046
  9,718
  11,584
  13,644
  15,897
  18,338
  20,964
  23,771
  26,754
  29,910
  33,233
  36,724
  40,380
  44,198
  48,182
  52,331
  56,648
  61,137
  65,803
  70,652
  75,691
  80,928
  86,372
  92,033
  97,923
Debt-to-equity ratio
  2.873
  2.320
  2.590
  2.790
  2.930
  3.040
  3.120
  3.180
  3.220
  3.260
  3.290
  3.310
  3.330
  3.350
  3.360
  3.370
  3.380
  3.390
  3.390
  3.400
  3.410
  3.410
  3.410
  3.420
  3.420
  3.420
  3.430
  3.430
  3.430
  3.430
  3.440
Adjusted equity ratio
  0.217
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224
  0.224

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  128
  174
  234
  306
  391
  490
  603
  730
  871
  1,027
  1,196
  1,380
  1,577
  1,787
  2,009
  2,245
  2,492
  2,752
  3,024
  3,307
  3,603
  3,911
  4,231
  4,564
  4,911
  5,270
  5,644
  6,033
  6,437
  6,857
  7,294
Depreciation, amort., depletion, $m
  94
  127
  167
  215
  273
  339
  416
  502
  599
  705
  821
  947
  1,083
  1,228
  1,382
  1,545
  1,717
  1,897
  2,086
  2,283
  2,489
  2,703
  2,926
  3,158
  3,399
  3,650
  3,910
  4,181
  4,462
  4,754
  5,058
Funds from operations, $m
  31
  300
  401
  521
  664
  829
  1,019
  1,232
  1,470
  1,732
  2,018
  2,327
  2,660
  3,015
  3,391
  3,790
  4,209
  4,649
  5,110
  5,591
  6,092
  6,614
  7,158
  7,723
  8,310
  8,920
  9,554
  10,213
  10,899
  11,611
  12,353
Change in working capital, $m
  -106
  125
  153
  185
  219
  255
  292
  330
  368
  407
  445
  482
  518
  554
  589
  623
  656
  689
  722
  754
  786
  819
  852
  886
  921
  957
  995
  1,034
  1,075
  1,118
  1,163
Cash from operations, $m
  137
  176
  247
  336
  445
  574
  726
  902
  1,101
  1,325
  1,573
  1,845
  2,141
  2,460
  2,802
  3,167
  3,553
  3,960
  4,388
  4,837
  5,306
  5,795
  6,305
  6,836
  7,389
  7,963
  8,559
  9,179
  9,824
  10,493
  11,190
Maintenance CAPEX, $m
  0
  -94
  -127
  -167
  -215
  -272
  -339
  -416
  -502
  -598
  -705
  -821
  -947
  -1,083
  -1,228
  -1,382
  -1,545
  -1,717
  -1,897
  -2,086
  -2,283
  -2,489
  -2,703
  -2,926
  -3,158
  -3,399
  -3,650
  -3,910
  -4,181
  -4,462
  -4,754
New CAPEX, $m
  0
  -307
  -377
  -455
  -539
  -627
  -719
  -812
  -906
  -1,000
  -1,094
  -1,185
  -1,275
  -1,363
  -1,449
  -1,532
  -1,614
  -1,695
  -1,775
  -1,854
  -1,934
  -2,015
  -2,096
  -2,180
  -2,266
  -2,355
  -2,447
  -2,543
  -2,644
  -2,749
  -2,860
Cash from investing activities, $m
  -21
  -401
  -504
  -622
  -754
  -899
  -1,058
  -1,228
  -1,408
  -1,598
  -1,799
  -2,006
  -2,222
  -2,446
  -2,677
  -2,914
  -3,159
  -3,412
  -3,672
  -3,940
  -4,217
  -4,504
  -4,799
  -5,106
  -5,424
  -5,754
  -6,097
  -6,453
  -6,825
  -7,211
  -7,614
Free cash flow, $m
  116
  -225
  -257
  -286
  -309
  -325
  -331
  -326
  -307
  -274
  -225
  -161
  -81
  15
  126
  252
  393
  548
  716
  896
  1,088
  1,292
  1,506
  1,730
  1,965
  2,209
  2,463
  2,726
  3,000
  3,283
  3,576
Issuance/(repayment) of debt, $m
  117
  490
  603
  728
  861
  1,002
  1,148
  1,298
  1,448
  1,599
  1,748
  1,894
  2,038
  2,178
  2,315
  2,449
  2,580
  2,709
  2,836
  2,964
  3,091
  3,220
  3,350
  3,484
  3,621
  3,763
  3,910
  4,064
  4,225
  4,393
  4,570
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  
  117
  490
  603
  728
  861
  1,002
  1,148
  1,298
  1,448
  1,599
  1,748
  1,894
  2,038
  2,178
  2,315
  2,449
  2,580
  2,709
  2,836
  2,964
  3,091
  3,220
  3,350
  3,484
  3,621
  3,763
  3,910
  4,064
  4,225
  4,393
  4,570
Total cash flow (excl. dividends), $m
  190
  265
  346
  442
  552
  677
  817
  972
  1,141
  1,325
  1,522
  1,733
  1,956
  2,193
  2,441
  2,701
  2,973
  3,257
  3,552
  3,860
  4,179
  4,511
  4,856
  5,214
  5,586
  5,972
  6,373
  6,790
  7,224
  7,676
  8,146
Retained Cash Flow (-), $m
  -68
  -141
  -174
  -210
  -249
  -289
  -331
  -375
  -418
  -462
  -505
  -547
  -588
  -629
  -668
  -707
  -745
  -782
  -819
  -855
  -892
  -929
  -967
  -1,006
  -1,045
  -1,086
  -1,129
  -1,173
  -1,219
  -1,268
  -1,319
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
 
  124
  172
  232
  303
  388
  486
  597
  723
  863
  1,018
  1,186
  1,368
  1,564
  1,773
  1,994
  2,228
  2,475
  2,734
  3,004
  3,287
  3,582
  3,889
  4,208
  4,540
  4,886
  5,244
  5,617
  6,005
  6,408
  6,827
Discount rate, %
 
  7.10
  7.46
  7.83
  8.22
  8.63
  9.06
  9.51
  9.99
  10.49
  11.01
  11.57
  12.14
  12.75
  13.39
  14.06
  14.76
  15.50
  16.27
  17.09
  17.94
  18.84
  19.78
  20.77
  21.81
  22.90
  24.04
  25.25
  26.51
  27.83
  29.22
PV of cash for distribution, $m
 
  116
  149
  185
  221
  256
  289
  316
  338
  352
  358
  356
  346
  329
  305
  277
  246
  214
  181
  150
  121
  96
  73
  55
  40
  28
  19
  13
  8
  5
  3
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

Hanwha Q CELLS Co., Ltd., formerly Hanwha SolarOne Co., Ltd., is a global solar energy company engaged in the manufacturing of solar modules, and the development and management of downstream solar farms. It manufactures a range of photo voltaic (PV) cells and PV modules at its manufacturing facilities in China and Malaysia using manufacturing process technologies, including those developed at its research and development facilities in Germany. It also engages in PV downstream businesses, which include developing solar power projects and providing engineering, procurement and construction services, and operation and management services. It develops and builds solar power projects incorporating its PV modules to sells them to third-party purchasers upon completion. Its principal products include PV modules, PV cells, silicon ingots and silicon wafers. It sells a range of PV modules, ranging from 250 watts to 340 watts in power output specification.

FINANCIAL RATIOS  of  Hanwha Q CELLS ADR (HQCL)

Valuation Ratios
P/E Ratio 242.5
Price to Sales 12.8
Price to Book 76.1
Price to Tangible Book
Price to Cash Flow 226.6
Price to Free Cash Flow 226.6
Growth Rates
Sales Growth Rate 34.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate -100%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 157.8%
Total Debt to Equity 287.3%
Interest Coverage 3
Management Effectiveness
Return On Assets 7.8%
Ret/ On Assets - 3 Yr. Avg. 1.2%
Return On Total Capital 8.6%
Ret/ On T. Cap. - 3 Yr. Avg. 0.3%
Return On Equity 34.2%
Return On Equity - 3 Yr. Avg. 4.3%
Asset Turnover 1
Profitability Ratios
Gross Margin 18.1%
Gross Margin - 3 Yr. Avg. 15.1%
EBITDA Margin 11.2%
EBITDA Margin - 3 Yr. Avg. 6%
Operating Margin 7.9%
Oper. Margin - 3 Yr. Avg. 3.6%
Pre-Tax Margin 5.1%
Pre-Tax Margin - 3 Yr. Avg. -1.7%
Net Profit Margin 5.3%
Net Profit Margin - 3 Yr. Avg. -1.7%
Effective Tax Rate -4.1%
Eff/ Tax Rate - 3 Yr. Avg. 5.5%
Payout Ratio 0%

HQCL stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the HQCL stock intrinsic value calculation we used $2426 million for the last fiscal year's total revenue generated by Hanwha Q CELLS ADR. The default revenue input number comes from 2016 income statement of Hanwha Q CELLS 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 HQCL stock valuation model: a) initial revenue growth rate of 34.7% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 7.1%, whose default value for HQCL is calculated based on our internal credit rating of Hanwha Q CELLS 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 Hanwha Q CELLS 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 HQCL stock the variable cost ratio is equal to 89.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $62 million in the base year in the intrinsic value calculation for HQCL 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 4.9% for Hanwha Q CELLS ADR.

Corporate tax rate of 27% is the nominal tax rate for Hanwha Q CELLS 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 HQCL 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 HQCL are equal to 36.4%.

Life of production assets of 9.4 years is the average useful life of capital assets used in Hanwha Q CELLS 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 HQCL is equal to 14.8%. 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 - $408 million for Hanwha Q CELLS 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 84.997 million for Hanwha Q CELLS 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 Hanwha Q CELLS ADR at the current share price and the inputted number of shares is $0.6 billion.

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COMPANY NEWS

▶ Hanwha Q CELLS Reports Second Quarter 2017 Results   [Aug-10-17 07:00AM  PR Newswire]
▶ Solar Manufacturers Face a Tough Market in 2017   [Jun-08-17 01:39PM  Motley Fool]
▶ Hanwha Q CELLS Reports First Quarter 2017 Results   [May-25-17 07:00AM  PR Newswire]
▶ Hanwha Q CELLS Files its 2016 Annual Report on Form 20-F   [May-01-17 07:00AM  PR Newswire]
▶ Chinese Solar Manufacturers Are Their Own Worst Enemies   [Mar-28-17 03:23PM  Motley Fool]
▶ Hanwha Q CELLS to Attend 29th Annual ROTH Conference   [Mar-06-17 04:30PM  PR Newswire]
▶ 3 Solar Stocks to Watch in 2016   [Jul-26-16 08:08AM  at Motley Fool]
▶ Storm Damage Could Impact on Canadian Solar's Bottom Line   [Jun-28-16 05:36PM  at Motley Fool]
▶ 2 Cheap Tech Stocks You Can Buy Today   [03:38PM  at Motley Fool]
▶ HANWHA Q CELLS CO., LTD. Financials   [01:04PM  EDGAR Online Financials]
▶ Hanwha Q CELLS Files its 2015 Annual Report on Form 20-F   [Apr-27-16 05:20PM  PR Newswire]
Financial statements of HQCL
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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