Intrinsic value of JinkoSolar Holding ADR - JKS

Previous Close

$24.37

  Intrinsic Value

$40.07

stock screener

  Rating & Target

str. buy

+64%

Previous close

$24.37

 
Intrinsic value

$40.07

 
Up/down potential

+64%

 
Rating

str. buy

We calculate the intrinsic value of JKS 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 0.8

 

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, %
  38.46
  39.80
  36.32
  33.19
  30.37
  27.83
  25.55
  23.49
  21.64
  19.98
  18.48
  17.13
  15.92
  14.83
  13.85
  12.96
  12.17
  11.45
  10.80
  10.22
  9.70
  9.23
  8.81
  8.43
  8.08
  7.78
  7.50
  7.25
  7.02
  6.82
  6.64
Revenue, $m
  3,096
  4,328
  5,900
  7,858
  10,245
  13,096
  16,442
  20,305
  24,700
  29,635
  35,113
  41,129
  47,677
  54,747
  62,327
  70,405
  78,970
  88,011
  97,519
  107,489
  117,916
  128,801
  140,145
  151,955
  164,240
  177,011
  190,284
  204,076
  218,410
  233,308
  248,798
Variable operating expenses, $m
 
  4,017
  5,475
  7,293
  9,507
  12,153
  15,258
  18,843
  22,922
  27,502
  32,585
  38,168
  44,244
  50,805
  57,839
  65,336
  73,284
  81,674
  90,498
  99,750
  109,426
  119,527
  130,055
  141,015
  152,415
  164,266
  176,583
  189,383
  202,684
  216,510
  230,884
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
  2,900
  4,017
  5,475
  7,293
  9,507
  12,153
  15,258
  18,843
  22,922
  27,502
  32,585
  38,168
  44,244
  50,805
  57,839
  65,336
  73,284
  81,674
  90,498
  99,750
  109,426
  119,527
  130,055
  141,015
  152,415
  164,266
  176,583
  189,383
  202,684
  216,510
  230,884
Operating income, $m
  196
  312
  425
  566
  738
  943
  1,184
  1,462
  1,778
  2,134
  2,528
  2,961
  3,433
  3,942
  4,488
  5,069
  5,686
  6,337
  7,021
  7,739
  8,490
  9,274
  10,090
  10,941
  11,825
  12,745
  13,700
  14,694
  15,726
  16,798
  17,913
EBITDA, $m
  310
  472
  643
  856
  1,116
  1,427
  1,791
  2,212
  2,691
  3,229
  3,826
  4,481
  5,194
  5,965
  6,790
  7,671
  8,604
  9,589
  10,625
  11,711
  12,847
  14,033
  15,269
  16,555
  17,894
  19,285
  20,731
  22,234
  23,796
  25,419
  27,106
Interest expense (income), $m
  97
  87
  154
  241
  348
  479
  636
  820
  1,032
  1,274
  1,545
  1,846
  2,177
  2,537
  2,926
  3,342
  3,787
  4,257
  4,754
  5,277
  5,825
  6,398
  6,997
  7,620
  8,270
  8,945
  9,647
  10,377
  11,135
  11,923
  12,742
Earnings before tax, $m
  181
  225
  271
  325
  389
  464
  548
  642
  746
  860
  983
  1,115
  1,256
  1,405
  1,562
  1,727
  1,899
  2,079
  2,267
  2,462
  2,665
  2,875
  3,094
  3,320
  3,556
  3,800
  4,053
  4,317
  4,591
  4,875
  5,172
Tax expense, $m
  38
  61
  73
  88
  105
  125
  148
  173
  201
  232
  265
  301
  339
  379
  422
  466
  513
  561
  612
  665
  719
  776
  835
  897
  960
  1,026
  1,094
  1,166
  1,239
  1,316
  1,396
Net income, $m
  264
  164
  198
  237
  284
  338
  400
  469
  545
  628
  717
  814
  917
  1,025
  1,140
  1,260
  1,386
  1,518
  1,655
  1,797
  1,945
  2,099
  2,258
  2,424
  2,596
  2,774
  2,959
  3,151
  3,351
  3,559
  3,775

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  372
  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
  3,775
  4,756
  6,484
  8,636
  11,258
  14,392
  18,068
  22,313
  27,143
  32,566
  38,585
  45,197
  52,392
  60,161
  68,491
  77,368
  86,780
  96,715
  107,164
  118,119
  129,578
  141,539
  154,006
  166,984
  180,483
  194,518
  209,103
  224,260
  240,011
  256,383
  273,404
Adjusted assets (=assets-cash), $m
  3,403
  4,756
  6,484
  8,636
  11,258
  14,392
  18,068
  22,313
  27,143
  32,566
  38,585
  45,197
  52,392
  60,161
  68,491
  77,368
  86,780
  96,715
  107,164
  118,119
  129,578
  141,539
  154,006
  166,984
  180,483
  194,518
  209,103
  224,260
  240,011
  256,383
  273,404
Revenue / Adjusted assets
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
  0.910
Average production assets, $m
  676
  944
  1,286
  1,713
  2,233
  2,855
  3,584
  4,427
  5,385
  6,461
  7,655
  8,966
  10,394
  11,935
  13,587
  15,348
  17,215
  19,186
  21,259
  23,433
  25,706
  28,079
  30,552
  33,126
  35,804
  38,588
  41,482
  44,489
  47,613
  50,861
  54,238
Working capital, $m
  192
  1,913
  2,608
  3,473
  4,528
  5,789
  7,267
  8,975
  10,918
  13,099
  15,520
  18,179
  21,073
  24,198
  27,548
  31,119
  34,905
  38,901
  43,103
  47,510
  52,119
  56,930
  61,944
  67,164
  72,594
  78,239
  84,105
  90,202
  96,537
  103,122
  109,969
Total debt, $m
  1,626
  2,234
  3,487
  5,047
  6,948
  9,220
  11,886
  14,963
  18,465
  22,397
  26,760
  31,554
  36,770
  42,403
  48,442
  54,878
  61,701
  68,904
  76,480
  84,423
  92,730
  101,402
  110,440
  119,849
  129,636
  139,811
  150,386
  161,374
  172,794
  184,663
  197,004
Total liabilities, $m
  2,840
  3,448
  4,701
  6,261
  8,162
  10,434
  13,100
  16,177
  19,679
  23,611
  27,974
  32,768
  37,984
  43,617
  49,656
  56,092
  62,915
  70,118
  77,694
  85,637
  93,944
  102,616
  111,654
  121,063
  130,850
  141,025
  151,600
  162,588
  174,008
  185,877
  198,218
Total equity, $m
  935
  1,308
  1,783
  2,375
  3,096
  3,958
  4,969
  6,136
  7,464
  8,956
  10,611
  12,429
  14,408
  16,544
  18,835
  21,276
  23,864
  26,597
  29,470
  32,483
  35,634
  38,923
  42,352
  45,921
  49,633
  53,492
  57,503
  61,671
  66,003
  70,505
  75,186
Total liabilities and equity, $m
  3,775
  4,756
  6,484
  8,636
  11,258
  14,392
  18,069
  22,313
  27,143
  32,567
  38,585
  45,197
  52,392
  60,161
  68,491
  77,368
  86,779
  96,715
  107,164
  118,120
  129,578
  141,539
  154,006
  166,984
  180,483
  194,517
  209,103
  224,259
  240,011
  256,382
  273,404
Debt-to-equity ratio
  1.739
  1.710
  1.960
  2.130
  2.240
  2.330
  2.390
  2.440
  2.470
  2.500
  2.520
  2.540
  2.550
  2.560
  2.570
  2.580
  2.590
  2.590
  2.600
  2.600
  2.600
  2.610
  2.610
  2.610
  2.610
  2.610
  2.620
  2.620
  2.620
  2.620
  2.620
Adjusted equity ratio
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275
  0.275

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  264
  164
  198
  237
  284
  338
  400
  469
  545
  628
  717
  814
  917
  1,025
  1,140
  1,260
  1,386
  1,518
  1,655
  1,797
  1,945
  2,099
  2,258
  2,424
  2,596
  2,774
  2,959
  3,151
  3,351
  3,559
  3,775
Depreciation, amort., depletion, $m
  114
  160
  218
  290
  379
  484
  608
  750
  913
  1,095
  1,297
  1,520
  1,762
  2,023
  2,303
  2,601
  2,918
  3,252
  3,603
  3,972
  4,357
  4,759
  5,178
  5,615
  6,069
  6,540
  7,031
  7,540
  8,070
  8,621
  9,193
Funds from operations, $m
  -871
  324
  416
  528
  663
  822
  1,007
  1,219
  1,457
  1,723
  2,015
  2,333
  2,678
  3,048
  3,443
  3,862
  4,304
  4,770
  5,258
  5,769
  6,302
  6,858
  7,437
  8,039
  8,664
  9,314
  9,990
  10,692
  11,421
  12,180
  12,968
Change in working capital, $m
  -610
  545
  695
  866
  1,055
  1,260
  1,479
  1,707
  1,943
  2,181
  2,421
  2,659
  2,894
  3,125
  3,350
  3,571
  3,786
  3,996
  4,203
  4,407
  4,609
  4,811
  5,014
  5,220
  5,430
  5,645
  5,867
  6,096
  6,335
  6,585
  6,846
Cash from operations, $m
  -261
  -220
  -279
  -338
  -392
  -438
  -472
  -489
  -485
  -459
  -406
  -326
  -216
  -77
  93
  291
  519
  774
  1,055
  1,362
  1,693
  2,047
  2,422
  2,818
  3,234
  3,669
  4,123
  4,595
  5,086
  5,595
  6,122
Maintenance CAPEX, $m
  0
  -115
  -160
  -218
  -290
  -379
  -484
  -608
  -750
  -913
  -1,095
  -1,297
  -1,520
  -1,762
  -2,023
  -2,303
  -2,601
  -2,918
  -3,252
  -3,603
  -3,972
  -4,357
  -4,759
  -5,178
  -5,615
  -6,069
  -6,540
  -7,031
  -7,540
  -8,070
  -8,621
New CAPEX, $m
  -302
  -268
  -343
  -427
  -520
  -622
  -729
  -842
  -958
  -1,076
  -1,194
  -1,312
  -1,427
  -1,541
  -1,652
  -1,761
  -1,867
  -1,971
  -2,073
  -2,173
  -2,273
  -2,373
  -2,473
  -2,575
  -2,678
  -2,784
  -2,893
  -3,007
  -3,125
  -3,248
  -3,377
Cash from investing activities, $m
  -1,000
  -383
  -503
  -645
  -810
  -1,001
  -1,213
  -1,450
  -1,708
  -1,989
  -2,289
  -2,609
  -2,947
  -3,303
  -3,675
  -4,064
  -4,468
  -4,889
  -5,325
  -5,776
  -6,245
  -6,730
  -7,232
  -7,753
  -8,293
  -8,853
  -9,433
  -10,038
  -10,665
  -11,318
  -11,998
Free cash flow, $m
  -1,261
  -603
  -782
  -983
  -1,203
  -1,438
  -1,685
  -1,938
  -2,194
  -2,447
  -2,695
  -2,935
  -3,163
  -3,379
  -3,583
  -3,773
  -3,950
  -4,115
  -4,269
  -4,414
  -4,552
  -4,683
  -4,810
  -4,934
  -5,058
  -5,183
  -5,311
  -5,442
  -5,579
  -5,723
  -5,876
Issuance/(repayment) of debt, $m
  898
  980
  1,252
  1,560
  1,901
  2,272
  2,666
  3,078
  3,502
  3,932
  4,364
  4,793
  5,217
  5,633
  6,039
  6,436
  6,824
  7,203
  7,575
  7,943
  8,308
  8,672
  9,038
  9,409
  9,787
  10,175
  10,574
  10,989
  11,420
  11,870
  12,341
Issuance/(repurchase) of shares, $m
  3
  209
  277
  354
  437
  523
  611
  699
  784
  864
  938
  1,004
  1,062
  1,111
  1,151
  1,181
  1,202
  1,214
  1,219
  1,215
  1,206
  1,190
  1,170
  1,145
  1,117
  1,085
  1,052
  1,017
  980
  943
  906
Cash from financing (excl. dividends), $m  
  1,079
  1,189
  1,529
  1,914
  2,338
  2,795
  3,277
  3,777
  4,286
  4,796
  5,302
  5,797
  6,279
  6,744
  7,190
  7,617
  8,026
  8,417
  8,794
  9,158
  9,514
  9,862
  10,208
  10,554
  10,904
  11,260
  11,626
  12,006
  12,400
  12,813
  13,247
Total cash flow (excl. dividends), $m
  -171
  586
  748
  932
  1,136
  1,357
  1,592
  1,838
  2,091
  2,348
  2,606
  2,863
  3,116
  3,364
  3,607
  3,844
  4,076
  4,302
  4,525
  4,744
  4,962
  5,179
  5,398
  5,620
  5,846
  6,077
  6,316
  6,563
  6,821
  7,089
  7,371
Retained Cash Flow (-), $m
  -310
  -373
  -475
  -592
  -721
  -862
  -1,011
  -1,167
  -1,328
  -1,491
  -1,655
  -1,818
  -1,979
  -2,136
  -2,291
  -2,441
  -2,588
  -2,732
  -2,873
  -3,013
  -3,151
  -3,289
  -3,428
  -3,569
  -3,712
  -3,859
  -4,011
  -4,168
  -4,332
  -4,502
  -4,681
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
 
  213
  273
  340
  414
  495
  581
  671
  763
  857
  951
  1,045
  1,137
  1,228
  1,316
  1,403
  1,487
  1,570
  1,651
  1,731
  1,811
  1,890
  1,970
  2,051
  2,133
  2,218
  2,305
  2,395
  2,489
  2,587
  2,690
Discount rate, %
 
  7.30
  7.67
  8.05
  8.45
  8.87
  9.32
  9.78
  10.27
  10.79
  11.32
  11.89
  12.49
  13.11
  13.77
  14.45
  15.18
  15.93
  16.73
  17.57
  18.45
  19.37
  20.34
  21.35
  22.42
  23.54
  24.72
  25.96
  27.25
  28.62
  30.05
PV of cash for distribution, $m
 
  199
  235
  270
  300
  324
  340
  349
  349
  341
  325
  304
  277
  248
  216
  185
  155
  127
  102
  80
  61
  46
  34
  24
  17
  11
  7
  5
  3
  2
  1
Current shareholders' claim on cash, %
  100
  79.2
  63.3
  51.3
  42.2
  35.2
  29.7
  25.5
  22.2
  19.5
  17.4
  15.6
  14.2
  13.0
  12.0
  11.2
  10.5
  9.9
  9.4
  9.0
  8.6
  8.3
  8.0
  7.7
  7.5
  7.3
  7.2
  7.0
  6.9
  6.8
  6.7

JinkoSolar Holding Co., Ltd. operates in the photovoltaic (PV) industry. The Company has built a vertically integrated solar power product value chain, from recovering silicon materials to manufacturing solar modules and solar power generation. The Company's segments include the manufacturing segment and the solar power projects segment. The manufacturing segment comprises its vertically integrated solar power product manufacturing business, under which the Company manufactures silicon ingots, wafers, cells and solar modules. The solar power projects segment comprises the downstream solar power generation, construction and operation business, including power generation; engineering, procurement and construction (EPC), and connecting solar power projects to the grid, and operation and maintenance (O&M) of the solar power projects. The Company sells its solar modules under the JinkoSolar brand. Its services include solar system EPC and processing services.

FINANCIAL RATIOS  of  JinkoSolar Holding ADR (JKS)

Valuation Ratios
P/E Ratio 11.7
Price to Sales 1
Price to Book 3.3
Price to Tangible Book
Price to Cash Flow -11.8
Price to Free Cash Flow -5.5
Growth Rates
Sales Growth Rate 38.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 127.1%
Cap. Spend. - 3 Yr. Gr. Rate 34.3%
Financial Strength
Quick Ratio 0
Current Ratio 0.2
LT Debt to Equity 8.2%
Total Debt to Equity 173.9%
Interest Coverage 3
Management Effectiveness
Return On Assets 8.8%
Ret/ On Assets - 3 Yr. Avg. 6.5%
Return On Total Capital 12.1%
Ret/ On T. Cap. - 3 Yr. Avg. 8.2%
Return On Equity 33.8%
Return On Equity - 3 Yr. Avg. 25.2%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 18.1%
Gross Margin - 3 Yr. Avg. 19.5%
EBITDA Margin 12.7%
EBITDA Margin - 3 Yr. Avg. 12.5%
Operating Margin 6.3%
Oper. Margin - 3 Yr. Avg. 7.4%
Pre-Tax Margin 5.8%
Pre-Tax Margin - 3 Yr. Avg. 5.7%
Net Profit Margin 8.5%
Net Profit Margin - 3 Yr. Avg. 6.6%
Effective Tax Rate 21%
Eff/ Tax Rate - 3 Yr. Avg. 2.5%
Payout Ratio 0%

JKS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JKS stock intrinsic value calculation we used $3096 million for the last fiscal year's total revenue generated by JinkoSolar Holding ADR. The default revenue input number comes from 2016 income statement of JinkoSolar Holding 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 JKS stock valuation model: a) initial revenue growth rate of 39.8% 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 7.3%, whose default value for JKS is calculated based on our internal credit rating of JinkoSolar Holding 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 JinkoSolar Holding 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 JKS stock the variable cost ratio is equal to 92.8%.

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 JKS 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 6.9% for JinkoSolar Holding ADR.

Corporate tax rate of 27% is the nominal tax rate for JinkoSolar Holding 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 JKS 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 JKS are equal to 21.8%.

Life of production assets of 5.9 years is the average useful life of capital assets used in JinkoSolar Holding 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 JKS is equal to 44.2%. 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 - $935 million for JinkoSolar Holding 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 32.547 million for JinkoSolar Holding 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 JinkoSolar Holding ADR at the current share price and the inputted number of shares is $0.8 billion.

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COMPANY NEWS

▶ JinkoSolar Part of SVTC 2016-17 Leaders   [Dec-11-17 05:50AM  PR Newswire]
▶ JinkoSolar posts 3Q profit   [06:16AM  Associated Press]
▶ Top NYSE Cheap Stocks To Buy   [Nov-26-17 08:02AM  Simply Wall St.]
▶ Should You Buy JinkoSolar Holding Co Ltd (JKS) Now?   [Sep-22-17 11:11AM  Simply Wall St.]
▶ Why China Is Crushing the U.S. in Solar Energy   [Sep-17-17 07:02AM  Motley Fool]
▶ First Solar Jumps On Buy Rating As Industry Gains Strength   [Sep-15-17 04:31PM  Investor's Business Daily]
▶ This Week in Solar   [Sep-08-17 05:05PM  Motley Fool]
▶ JinkoSolar posts 2Q profit   [Sep-06-17 11:57PM  Associated Press]
▶ Stock Indexes Edge Higher; Price-Target Hike No Help To Apple   [01:35PM  Investor's Business Daily]
▶ JinkoSolar, HD Supply, RH, Beige Book Due: Investing Action Plan   [Sep-05-17 04:03PM  Investor's Business Daily]
▶ JinkoSolar Invited to Attend the 9th BRICS Summit   [Sep-03-17 12:21PM  PR Newswire]
▶ Solar Stocks Are Heating Up   [Aug-09-17 01:00PM  Investopedia]
▶ 3 Stocks Billionaires Can't Buy but You Can   [Aug-05-17 11:32AM  Motley Fool]
▶ Sunny Times Ahead for the Solar Sector   [10:47AM  Investopedia]
▶ Solar Stocks Jump -- and Theres a Lot More Room to Run   [Jun-25-17 10:14AM  Motley Fool]
▶ Solar Stocks Fly As Trump Repeats Idea Of Border Wall Providing Energy   [Jun-22-17 04:21PM  Investor's Business Daily]
▶ Which Stocks Are Showing Rising Relative Strength?   [02:47PM  Investor's Business Daily]
▶ Solar Manufacturers Face a Tough Market in 2017   [Jun-08-17 01:39PM  Motley Fool]
▶ 3 Stocks With MercadoLibre-Like Return Potential   [Jun-07-17 09:25AM  Motley Fool]
▶ Story Stocks from Briefing.com   [10:44AM  Briefing.com]
▶ JinkoSolar posts 1Q profit   [06:17AM  Associated Press]
▶ This Week in Solar   [Jun-02-17 04:34PM  Motley Fool]
▶ This Week in Solar   [May-30-17 08:05AM  Motley Fool]
▶ Why Shares of JinkoSolar Holding Co. Plunged 11% Today   [May-26-17 04:27PM  Motley Fool]
Financial statements of JKS
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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