Intrinsic value of IRSA-Inversiones y Representaciones GDR - IRS

Previous Close

$25.03

  Intrinsic Value

$113.25

stock screener

  Rating & Target

str. buy

+352%

  Value-price divergence*

+5000%

Previous close

$25.03

 
Intrinsic value

$113.25

 
Up/down potential

+352%

 
Rating

str. buy

 
Value-price divergence*

+5000%

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

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

We calculate the intrinsic value of IRS 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 1.4

 

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, %
  859.17
  8.10
  7.79
  7.51
  7.26
  7.03
  6.83
  6.65
  6.48
  6.33
  6.20
  6.08
  5.97
  5.88
  5.79
  5.71
  5.64
  5.57
  5.52
  5.47
  5.42
  5.38
  5.34
  5.31
  5.27
  5.25
  5.22
  5.20
  5.18
  5.16
  5.15
Revenue, $m
  2,091
  2,260
  2,436
  2,619
  2,810
  3,007
  3,213
  3,426
  3,648
  3,879
  4,120
  4,371
  4,632
  4,904
  5,188
  5,484
  5,793
  6,116
  6,453
  6,806
  7,175
  7,560
  7,964
  8,387
  8,829
  9,292
  9,778
  10,286
  10,819
  11,377
  11,963
Variable operating expenses, $m
 
  591
  636
  683
  731
  782
  834
  889
  945
  1,004
  1,066
  1,115
  1,182
  1,251
  1,324
  1,399
  1,478
  1,561
  1,647
  1,737
  1,831
  1,930
  2,033
  2,140
  2,253
  2,371
  2,495
  2,625
  2,761
  2,904
  3,053
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
  1,868
  591
  636
  683
  731
  782
  834
  889
  945
  1,004
  1,066
  1,115
  1,182
  1,251
  1,324
  1,399
  1,478
  1,561
  1,647
  1,737
  1,831
  1,930
  2,033
  2,140
  2,253
  2,371
  2,495
  2,625
  2,761
  2,904
  3,053
Operating income, $m
  223
  1,669
  1,800
  1,937
  2,078
  2,226
  2,379
  2,538
  2,703
  2,875
  3,054
  3,255
  3,450
  3,652
  3,864
  4,084
  4,314
  4,555
  4,806
  5,069
  5,344
  5,631
  5,932
  6,246
  6,576
  6,921
  7,282
  7,661
  8,058
  8,474
  8,910
EBITDA, $m
  395
  1,864
  2,010
  2,161
  2,317
  2,480
  2,650
  2,826
  3,009
  3,200
  3,398
  3,605
  3,820
  4,045
  4,279
  4,523
  4,778
  5,044
  5,323
  5,613
  5,918
  6,236
  6,569
  6,917
  7,282
  7,664
  8,064
  8,484
  8,923
  9,384
  9,867
Interest expense (income), $m
  242
  463
  451
  500
  552
  605
  661
  719
  779
  841
  906
  973
  1,044
  1,117
  1,194
  1,273
  1,357
  1,444
  1,534
  1,629
  1,728
  1,832
  1,940
  2,054
  2,172
  2,297
  2,427
  2,563
  2,706
  2,856
  3,013
Earnings before tax, $m
  -110
  1,207
  1,349
  1,436
  1,527
  1,620
  1,718
  1,819
  1,924
  2,034
  2,148
  2,282
  2,406
  2,535
  2,670
  2,811
  2,958
  3,111
  3,272
  3,440
  3,615
  3,799
  3,991
  4,193
  4,403
  4,624
  4,855
  5,098
  5,352
  5,618
  5,897
Tax expense, $m
  10
  326
  364
  388
  412
  437
  464
  491
  520
  549
  580
  616
  650
  684
  721
  759
  799
  840
  883
  929
  976
  1,026
  1,078
  1,132
  1,189
  1,249
  1,311
  1,376
  1,445
  1,517
  1,592
Net income, $m
  -80
  881
  985
  1,048
  1,114
  1,183
  1,254
  1,328
  1,405
  1,485
  1,568
  1,666
  1,756
  1,851
  1,949
  2,052
  2,159
  2,271
  2,389
  2,511
  2,639
  2,773
  2,914
  3,061
  3,215
  3,376
  3,545
  3,721
  3,907
  4,101
  4,305

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,586
  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
  10,176
  11,026
  11,885
  12,778
  13,705
  14,670
  15,672
  16,713
  17,797
  18,924
  20,098
  21,320
  22,593
  23,921
  25,305
  26,750
  28,258
  29,833
  31,479
  33,200
  34,999
  36,880
  38,849
  40,911
  43,068
  45,328
  47,696
  50,176
  52,775
  55,500
  58,356
Adjusted assets (=assets-cash), $m
  8,590
  11,026
  11,885
  12,778
  13,705
  14,670
  15,672
  16,713
  17,797
  18,924
  20,098
  21,320
  22,593
  23,921
  25,305
  26,750
  28,258
  29,833
  31,479
  33,200
  34,999
  36,880
  38,849
  40,911
  43,068
  45,328
  47,696
  50,176
  52,775
  55,500
  58,356
Revenue / Adjusted assets
  0.243
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
Average production assets, $m
  2,795
  3,020
  3,255
  3,500
  3,754
  4,018
  4,292
  4,577
  4,874
  5,183
  5,504
  5,839
  6,188
  6,551
  6,931
  7,326
  7,739
  8,171
  8,621
  9,093
  9,585
  10,101
  10,640
  11,205
  11,796
  12,415
  13,063
  13,742
  14,454
  15,200
  15,982
Working capital, $m
  -53
  -226
  -244
  -262
  -281
  -301
  -321
  -343
  -365
  -388
  -412
  -437
  -463
  -490
  -519
  -548
  -579
  -612
  -645
  -681
  -717
  -756
  -796
  -839
  -883
  -929
  -978
  -1,029
  -1,082
  -1,138
  -1,196
Total debt, $m
  7,228
  7,047
  7,820
  8,623
  9,458
  10,326
  11,227
  12,165
  13,140
  14,155
  15,211
  16,311
  17,457
  18,651
  19,898
  21,198
  22,555
  23,973
  25,454
  27,003
  28,622
  30,315
  32,088
  33,942
  35,885
  37,919
  40,049
  42,281
  44,621
  47,073
  49,643
Total liabilities, $m
  10,105
  9,924
  10,697
  11,500
  12,335
  13,203
  14,104
  15,042
  16,017
  17,032
  18,088
  19,188
  20,334
  21,528
  22,775
  24,075
  25,432
  26,850
  28,331
  29,880
  31,499
  33,192
  34,965
  36,819
  38,762
  40,796
  42,926
  45,158
  47,498
  49,950
  52,520
Total equity, $m
  71
  1,103
  1,189
  1,278
  1,371
  1,467
  1,567
  1,671
  1,780
  1,892
  2,010
  2,132
  2,259
  2,392
  2,531
  2,675
  2,826
  2,983
  3,148
  3,320
  3,500
  3,688
  3,885
  4,091
  4,307
  4,533
  4,770
  5,018
  5,278
  5,550
  5,836
Total liabilities and equity, $m
  10,176
  11,027
  11,886
  12,778
  13,706
  14,670
  15,671
  16,713
  17,797
  18,924
  20,098
  21,320
  22,593
  23,920
  25,306
  26,750
  28,258
  29,833
  31,479
  33,200
  34,999
  36,880
  38,850
  40,910
  43,069
  45,329
  47,696
  50,176
  52,776
  55,500
  58,356
Debt-to-equity ratio
  101.803
  6.390
  6.580
  6.750
  6.900
  7.040
  7.160
  7.280
  7.380
  7.480
  7.570
  7.650
  7.730
  7.800
  7.860
  7.920
  7.980
  8.040
  8.090
  8.130
  8.180
  8.220
  8.260
  8.300
  8.330
  8.370
  8.400
  8.430
  8.450
  8.480
  8.510
Adjusted equity ratio
  -0.167
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -80
  881
  985
  1,048
  1,114
  1,183
  1,254
  1,328
  1,405
  1,485
  1,568
  1,666
  1,756
  1,851
  1,949
  2,052
  2,159
  2,271
  2,389
  2,511
  2,639
  2,773
  2,914
  3,061
  3,215
  3,376
  3,545
  3,721
  3,907
  4,101
  4,305
Depreciation, amort., depletion, $m
  172
  195
  209
  224
  239
  255
  271
  288
  306
  325
  344
  350
  371
  392
  415
  439
  463
  489
  516
  544
  574
  605
  637
  671
  706
  743
  782
  823
  866
  910
  957
Funds from operations, $m
  198
  1,076
  1,194
  1,272
  1,353
  1,438
  1,525
  1,616
  1,711
  1,810
  1,912
  2,015
  2,127
  2,243
  2,364
  2,491
  2,623
  2,761
  2,905
  3,056
  3,213
  3,378
  3,551
  3,732
  3,921
  4,119
  4,327
  4,544
  4,772
  5,011
  5,262
Change in working capital, $m
  -67
  -17
  -18
  -18
  -19
  -20
  -21
  -21
  -22
  -23
  -24
  -25
  -26
  -27
  -28
  -30
  -31
  -32
  -34
  -35
  -37
  -39
  -40
  -42
  -44
  -46
  -49
  -51
  -53
  -56
  -59
Cash from operations, $m
  265
  1,093
  1,212
  1,291
  1,372
  1,457
  1,546
  1,638
  1,733
  1,833
  1,936
  2,040
  2,153
  2,270
  2,392
  2,520
  2,654
  2,793
  2,939
  3,091
  3,250
  3,417
  3,591
  3,774
  3,965
  4,165
  4,375
  4,595
  4,826
  5,067
  5,321
Maintenance CAPEX, $m
  0
  -167
  -181
  -195
  -210
  -225
  -241
  -257
  -274
  -292
  -310
  -330
  -350
  -371
  -392
  -415
  -439
  -463
  -489
  -516
  -544
  -574
  -605
  -637
  -671
  -706
  -743
  -782
  -823
  -866
  -910
New CAPEX, $m
  -133
  -225
  -235
  -244
  -254
  -264
  -274
  -285
  -297
  -309
  -321
  -335
  -349
  -364
  -379
  -396
  -413
  -431
  -451
  -471
  -493
  -515
  -539
  -564
  -591
  -619
  -648
  -679
  -712
  -746
  -782
Cash from investing activities, $m
  525
  -392
  -416
  -439
  -464
  -489
  -515
  -542
  -571
  -601
  -631
  -665
  -699
  -735
  -771
  -811
  -852
  -894
  -940
  -987
  -1,037
  -1,089
  -1,144
  -1,201
  -1,262
  -1,325
  -1,391
  -1,461
  -1,535
  -1,612
  -1,692
Free cash flow, $m
  790
  700
  796
  851
  909
  969
  1,031
  1,095
  1,162
  1,232
  1,304
  1,376
  1,454
  1,536
  1,621
  1,709
  1,802
  1,898
  1,999
  2,103
  2,213
  2,327
  2,447
  2,572
  2,703
  2,840
  2,984
  3,134
  3,291
  3,456
  3,628
Issuance/(repayment) of debt, $m
  -9
  -181
  773
  803
  835
  868
  902
  938
  975
  1,015
  1,056
  1,100
  1,146
  1,195
  1,246
  1,300
  1,357
  1,418
  1,481
  1,548
  1,619
  1,694
  1,772
  1,855
  1,942
  2,034
  2,131
  2,232
  2,339
  2,452
  2,570
Issuance/(repurchase) of shares, $m
  -8
  151
  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  
  -247
  -30
  773
  803
  835
  868
  902
  938
  975
  1,015
  1,056
  1,100
  1,146
  1,195
  1,246
  1,300
  1,357
  1,418
  1,481
  1,548
  1,619
  1,694
  1,772
  1,855
  1,942
  2,034
  2,131
  2,232
  2,339
  2,452
  2,570
Total cash flow (excl. dividends), $m
  870
  669
  1,569
  1,655
  1,744
  1,836
  1,932
  2,033
  2,137
  2,247
  2,361
  2,476
  2,600
  2,731
  2,867
  3,010
  3,159
  3,316
  3,480
  3,652
  3,832
  4,021
  4,219
  4,427
  4,645
  4,874
  5,114
  5,366
  5,630
  5,908
  6,199
Retained Cash Flow (-), $m
  87
  -1,032
  -86
  -89
  -93
  -96
  -100
  -104
  -108
  -113
  -117
  -122
  -127
  -133
  -138
  -144
  -151
  -158
  -165
  -172
  -180
  -188
  -197
  -206
  -216
  -226
  -237
  -248
  -260
  -272
  -286
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
 
  -362
  1,483
  1,565
  1,651
  1,740
  1,832
  1,929
  2,029
  2,134
  2,243
  2,354
  2,473
  2,598
  2,729
  2,865
  3,008
  3,158
  3,315
  3,480
  3,652
  3,833
  4,022
  4,221
  4,429
  4,648
  4,877
  5,118
  5,370
  5,635
  5,913
Discount rate, %
 
  12.20
  12.81
  13.45
  14.12
  14.83
  15.57
  16.35
  17.17
  18.02
  18.93
  19.87
  20.87
  21.91
  23.00
  24.16
  25.36
  26.63
  27.96
  29.36
  30.83
  32.37
  33.99
  35.69
  37.47
  39.35
  41.31
  43.38
  45.55
  47.83
  50.22
PV of cash for distribution, $m
 
  -323
  1,165
  1,072
  973
  871
  769
  668
  571
  480
  396
  321
  254
  198
  150
  112
  81
  57
  39
  26
  17
  11
  6
  4
  2
  1
  1
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5
  82.5

IRSA Inversiones y Representaciones Sociedad Anónima engages in diversified real estates-related activities in Argentina. The company operates through six segments: Shopping Centers, Offices and Others, Sales and Development, Hotels, International, and Financial Operations and Others. It is involved in the acquisition, development, and operation of shopping centers, and office and other non-shopping center properties primarily for rental purposes. The company also acquires and operates hotels; develops and sells residential properties; and acquires undeveloped land reserves for future development or sale. In addition, it engages in consumer finance operations. The company was founded in 1943 and is headquartered in Buenos Aires, Argentina. IRSA Inversiones y Representaciones Sociedad Anónima is a subsidiary of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria.

FINANCIAL RATIOS  of  IRSA-Inversiones y Representaciones GDR (IRS)

Valuation Ratios
P/E Ratio -179.5
Price to Sales 6.9
Price to Book 202.3
Price to Tangible Book
Price to Cash Flow 54.2
Price to Free Cash Flow 108.8
Growth Rates
Sales Growth Rate 859.2%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 358.6%
Cap. Spend. - 3 Yr. Gr. Rate 56.9%
Financial Strength
Quick Ratio 1
Current Ratio 0
LT Debt to Equity 8174.6%
Total Debt to Equity 10180.3%
Interest Coverage 1
Management Effectiveness
Return On Assets 3.4%
Ret/ On Assets - 3 Yr. Avg. 3.4%
Return On Total Capital -2.1%
Ret/ On T. Cap. - 3 Yr. Avg. -0.9%
Return On Equity -69.9%
Return On Equity - 3 Yr. Avg. -22.8%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 29.9%
Gross Margin - 3 Yr. Avg. 43.9%
EBITDA Margin 14.5%
EBITDA Margin - 3 Yr. Avg. 23.8%
Operating Margin 10.7%
Oper. Margin - 3 Yr. Avg. 42.6%
Pre-Tax Margin -5.3%
Pre-Tax Margin - 3 Yr. Avg. 2.6%
Net Profit Margin -3.8%
Net Profit Margin - 3 Yr. Avg. -2.3%
Effective Tax Rate -9.1%
Eff/ Tax Rate - 3 Yr. Avg. 14.7%
Payout Ratio -8.8%

IRS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the IRS stock intrinsic value calculation we used $2091 million for the last fiscal year's total revenue generated by IRSA-Inversiones y Representaciones GDR. The default revenue input number comes from 2016 income statement of IRSA-Inversiones y Representaciones GDR. 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 IRS stock valuation model: a) initial revenue growth rate of 8.1% 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 12.2%, whose default value for IRS is calculated based on our internal credit rating of IRSA-Inversiones y Representaciones GDR, 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 IRSA-Inversiones y Representaciones GDR.
    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 IRS stock the variable cost ratio is equal to 26.2%.

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 IRS 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 6.4% for IRSA-Inversiones y Representaciones GDR.

Corporate tax rate of 27% is the nominal tax rate for IRSA-Inversiones y Representaciones GDR. 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 IRS 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 IRS are equal to 133.6%.

Life of production assets of 16.7 years is the average useful life of capital assets used in IRSA-Inversiones y Representaciones GDR 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 IRS is equal to -10%. 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 - $71 million for IRSA-Inversiones y Representaciones GDR - 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 57.717 million for IRSA-Inversiones y Representaciones GDR 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 IRSA-Inversiones y Representaciones GDR at the current share price and the inputted number of shares is $1.4 billion.

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COMPANY NEWS

▶ IRSA Inversiones posts 2Q profit   [Feb-13-17 02:26PM  Associated Press]
▶ Clearwater Paper Corp (CLW) Hedge Funds Are Snapping Up   [Dec-09-16 01:22AM  Insider Monkey]
▶ Argentina: Tax Amnesty For $400B In Hidden Assets?   [Aug-18-16 05:21PM  at Barrons.com]
▶ Argentina: If Congress OKs Holdout Bond Deal? Investors Win   [Mar-01-16 11:01AM  at Barrons.com]
▶ Hedge Funds Are Betting On PHH Corporation (PHH)   [Nov-30  01:06PM  at Insider Monkey]
▶ Do Hedge Funds Love SkyWest, Inc. (SKYW)?   [11:05AM  at Insider Monkey]
▶ IRSA Inversiones y Representaciones S.A. Material Fact   [Nov-24  09:30AM  PR Newswire]
▶ IRSA Inversiones y Representaciones S.A. Material Fact   [Nov-20  10:02AM  PR Newswire]
▶ VSE sues its insurance company over an alleged employee theft   [May-01  02:22PM  at bizjournals.com]
Stock chart of IRS Financial statements of IRS
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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