Intrinsic value of Newell Brands - NWL

Previous Close

$42.75

  Intrinsic Value

$23.75

stock screener

  Rating & Target

sell

-44%

  Value-price divergence*

-79%

Previous close

$42.75

 
Intrinsic value

$23.75

 
Up/down potential

-44%

 
Rating

sell

 
Value-price divergence*

-79%

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

We calculate the intrinsic value of NWL 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 20.9

 

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, %
  124.21
  5.10
  5.09
  5.08
  5.07
  5.07
  5.06
  5.05
  5.05
  5.04
  5.04
  5.03
  5.03
  5.03
  5.03
  5.02
  5.02
  5.02
  5.02
  5.02
  5.01
  5.01
  5.01
  5.01
  5.01
  5.01
  5.01
  5.01
  5.01
  5.01
  5.00
Revenue, $m
  13,264
  13,940
  14,650
  15,394
  16,175
  16,995
  17,854
  18,757
  19,704
  20,697
  21,740
  22,835
  23,984
  25,189
  26,455
  27,784
  29,179
  30,643
  32,181
  33,795
  35,489
  37,268
  39,135
  41,096
  43,154
  45,315
  47,584
  49,967
  52,468
  55,094
  57,851
Variable operating expenses, $m
 
  12,703
  13,298
  13,922
  14,576
  15,263
  15,983
  16,739
  17,533
  18,365
  19,239
  19,134
  20,097
  21,108
  22,168
  23,282
  24,451
  25,678
  26,966
  28,318
  29,738
  31,229
  32,794
  34,436
  36,161
  37,972
  39,874
  41,870
  43,966
  46,166
  48,477
Fixed operating expenses, $m
 
  77
  79
  81
  83
  85
  87
  89
  91
  94
  96
  98
  101
  103
  106
  109
  111
  114
  117
  120
  123
  126
  129
  132
  136
  139
  143
  146
  150
  153
  157
Total operating expenses, $m
  12,212
  12,780
  13,377
  14,003
  14,659
  15,348
  16,070
  16,828
  17,624
  18,459
  19,335
  19,232
  20,198
  21,211
  22,274
  23,391
  24,562
  25,792
  27,083
  28,438
  29,861
  31,355
  32,923
  34,568
  36,297
  38,111
  40,017
  42,016
  44,116
  46,319
  48,634
Operating income, $m
  1,053
  1,160
  1,273
  1,392
  1,516
  1,647
  1,784
  1,928
  2,080
  2,238
  2,405
  3,602
  3,785
  3,978
  4,181
  4,394
  4,617
  4,851
  5,098
  5,356
  5,628
  5,913
  6,212
  6,527
  6,857
  7,204
  7,568
  7,951
  8,352
  8,774
  9,217
EBITDA, $m
  1,490
  2,486
  2,614
  2,749
  2,890
  3,039
  3,195
  3,359
  3,530
  3,711
  3,900
  4,099
  4,308
  4,527
  4,757
  4,998
  5,252
  5,518
  5,798
  6,092
  6,400
  6,724
  7,064
  7,421
  7,797
  8,190
  8,604
  9,038
  9,494
  9,973
  10,476
Interest expense (income), $m
  316
  475
  522
  571
  623
  677
  734
  794
  856
  922
  991
  1,063
  1,139
  1,219
  1,302
  1,390
  1,482
  1,579
  1,681
  1,787
  1,899
  2,017
  2,140
  2,270
  2,406
  2,549
  2,698
  2,856
  3,021
  3,195
  3,377
Earnings before tax, $m
  815
  685
  751
  821
  894
  970
  1,050
  1,135
  1,223
  1,317
  1,414
  2,539
  2,647
  2,760
  2,879
  3,003
  3,135
  3,272
  3,417
  3,569
  3,729
  3,896
  4,072
  4,257
  4,451
  4,655
  4,870
  5,095
  5,331
  5,580
  5,840
Tax expense, $m
  286
  185
  203
  222
  241
  262
  284
  306
  330
  355
  382
  685
  715
  745
  777
  811
  846
  884
  923
  964
  1,007
  1,052
  1,100
  1,149
  1,202
  1,257
  1,315
  1,376
  1,439
  1,506
  1,577
Net income, $m
  528
  500
  548
  599
  652
  708
  767
  828
  893
  961
  1,032
  1,853
  1,932
  2,015
  2,101
  2,193
  2,288
  2,389
  2,494
  2,605
  2,722
  2,844
  2,973
  3,108
  3,250
  3,399
  3,555
  3,719
  3,892
  4,073
  4,263

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  588
  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
  33,838
  34,939
  36,717
  38,582
  40,540
  42,593
  44,748
  47,009
  49,382
  51,873
  54,486
  57,230
  60,109
  63,132
  66,304
  69,635
  73,131
  76,801
  80,654
  84,698
  88,945
  93,403
  98,083
  102,997
  108,156
  113,572
  119,259
  125,230
  131,498
  138,080
  144,991
Adjusted assets (=assets-cash), $m
  33,250
  34,939
  36,717
  38,582
  40,540
  42,593
  44,748
  47,009
  49,382
  51,873
  54,486
  57,230
  60,109
  63,132
  66,304
  69,635
  73,131
  76,801
  80,654
  84,698
  88,945
  93,403
  98,083
  102,997
  108,156
  113,572
  119,259
  125,230
  131,498
  138,080
  144,991
Revenue / Adjusted assets
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
  0.399
Average production assets, $m
  8,659
  9,103
  9,566
  10,053
  10,562
  11,098
  11,659
  12,248
  12,866
  13,515
  14,196
  14,911
  15,661
  16,449
  17,275
  18,143
  19,054
  20,010
  21,014
  22,068
  23,174
  24,336
  25,555
  26,836
  28,180
  29,591
  31,073
  32,628
  34,262
  35,976
  37,777
Working capital, $m
  3,193
  3,374
  3,545
  3,725
  3,914
  4,113
  4,321
  4,539
  4,768
  5,009
  5,261
  5,526
  5,804
  6,096
  6,402
  6,724
  7,061
  7,416
  7,788
  8,178
  8,588
  9,019
  9,471
  9,945
  10,443
  10,966
  11,515
  12,092
  12,697
  13,333
  14,000
Total debt, $m
  11,893
  12,428
  13,600
  14,830
  16,120
  17,473
  18,893
  20,383
  21,947
  23,588
  25,310
  27,118
  29,016
  31,008
  33,098
  35,293
  37,597
  40,016
  42,555
  45,220
  48,019
  50,956
  54,041
  57,279
  60,679
  64,248
  67,996
  71,930
  76,061
  80,399
  84,953
Total liabilities, $m
  22,489
  23,024
  24,196
  25,426
  26,716
  28,069
  29,489
  30,979
  32,543
  34,184
  35,906
  37,714
  39,612
  41,604
  43,694
  45,889
  48,193
  50,612
  53,151
  55,816
  58,615
  61,552
  64,637
  67,875
  71,275
  74,844
  78,592
  82,526
  86,657
  90,995
  95,549
Total equity, $m
  11,349
  11,914
  12,520
  13,157
  13,824
  14,524
  15,259
  16,030
  16,839
  17,689
  18,580
  19,515
  20,497
  21,528
  22,610
  23,745
  24,938
  26,189
  27,503
  28,882
  30,330
  31,850
  33,446
  35,122
  36,881
  38,728
  40,667
  42,703
  44,841
  47,085
  49,442
Total liabilities and equity, $m
  33,838
  34,938
  36,716
  38,583
  40,540
  42,593
  44,748
  47,009
  49,382
  51,873
  54,486
  57,229
  60,109
  63,132
  66,304
  69,634
  73,131
  76,801
  80,654
  84,698
  88,945
  93,402
  98,083
  102,997
  108,156
  113,572
  119,259
  125,229
  131,498
  138,080
  144,991
Debt-to-equity ratio
  1.048
  1.040
  1.090
  1.130
  1.170
  1.200
  1.240
  1.270
  1.300
  1.330
  1.360
  1.390
  1.420
  1.440
  1.460
  1.490
  1.510
  1.530
  1.550
  1.570
  1.580
  1.600
  1.620
  1.630
  1.650
  1.660
  1.670
  1.680
  1.700
  1.710
  1.720
Adjusted equity ratio
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341
  0.341

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  528
  500
  548
  599
  652
  708
  767
  828
  893
  961
  1,032
  1,853
  1,932
  2,015
  2,101
  2,193
  2,288
  2,389
  2,494
  2,605
  2,722
  2,844
  2,973
  3,108
  3,250
  3,399
  3,555
  3,719
  3,892
  4,073
  4,263
Depreciation, amort., depletion, $m
  437
  1,325
  1,341
  1,357
  1,374
  1,392
  1,411
  1,430
  1,451
  1,472
  1,495
  497
  522
  548
  576
  605
  635
  667
  700
  736
  772
  811
  852
  895
  939
  986
  1,036
  1,088
  1,142
  1,199
  1,259
Funds from operations, $m
  2,661
  1,826
  1,889
  1,956
  2,026
  2,100
  2,177
  2,259
  2,344
  2,433
  2,527
  2,350
  2,454
  2,563
  2,677
  2,797
  2,923
  3,056
  3,195
  3,341
  3,494
  3,655
  3,825
  4,002
  4,189
  4,385
  4,591
  4,807
  5,034
  5,272
  5,523
Change in working capital, $m
  832
  164
  172
  180
  189
  198
  208
  218
  229
  240
  252
  265
  278
  292
  306
  322
  338
  354
  372
  391
  410
  430
  452
  474
  498
  523
  549
  577
  605
  636
  667
Cash from operations, $m
  1,829
  1,662
  1,717
  1,776
  1,837
  1,902
  1,969
  2,040
  2,115
  2,193
  2,275
  2,085
  2,176
  2,271
  2,371
  2,476
  2,586
  2,701
  2,823
  2,950
  3,084
  3,225
  3,373
  3,528
  3,691
  3,862
  4,042
  4,230
  4,429
  4,637
  4,855
Maintenance CAPEX, $m
  0
  -289
  -303
  -319
  -335
  -352
  -370
  -389
  -408
  -429
  -451
  -473
  -497
  -522
  -548
  -576
  -605
  -635
  -667
  -700
  -736
  -772
  -811
  -852
  -895
  -939
  -986
  -1,036
  -1,088
  -1,142
  -1,199
New CAPEX, $m
  -441
  -444
  -463
  -486
  -510
  -535
  -561
  -589
  -618
  -649
  -681
  -715
  -750
  -787
  -827
  -868
  -911
  -956
  -1,004
  -1,054
  -1,106
  -1,162
  -1,219
  -1,280
  -1,344
  -1,411
  -1,482
  -1,556
  -1,633
  -1,715
  -1,801
Cash from investing activities, $m
  -8,825
  -733
  -766
  -805
  -845
  -887
  -931
  -978
  -1,026
  -1,078
  -1,132
  -1,188
  -1,247
  -1,309
  -1,375
  -1,444
  -1,516
  -1,591
  -1,671
  -1,754
  -1,842
  -1,934
  -2,030
  -2,132
  -2,239
  -2,350
  -2,468
  -2,592
  -2,721
  -2,857
  -3,000
Free cash flow, $m
  -6,996
  929
  951
  971
  992
  1,015
  1,038
  1,062
  1,088
  1,115
  1,144
  897
  929
  962
  996
  1,032
  1,070
  1,110
  1,152
  1,196
  1,242
  1,291
  1,342
  1,396
  1,452
  1,511
  1,574
  1,639
  1,708
  1,780
  1,856
Issuance/(repayment) of debt, $m
  7,673
  1,123
  1,172
  1,229
  1,290
  1,353
  1,420
  1,490
  1,564
  1,641
  1,722
  1,808
  1,898
  1,992
  2,091
  2,195
  2,304
  2,419
  2,539
  2,666
  2,798
  2,938
  3,084
  3,238
  3,400
  3,569
  3,748
  3,935
  4,131
  4,337
  4,554
Issuance/(repurchase) of shares, $m
  -16
  65
  58
  37
  15
  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  
  7,669
  1,188
  1,230
  1,266
  1,305
  1,353
  1,420
  1,490
  1,564
  1,641
  1,722
  1,808
  1,898
  1,992
  2,091
  2,195
  2,304
  2,419
  2,539
  2,666
  2,798
  2,938
  3,084
  3,238
  3,400
  3,569
  3,748
  3,935
  4,131
  4,337
  4,554
Total cash flow (excl. dividends), $m
  642
  2,117
  2,181
  2,237
  2,297
  2,368
  2,458
  2,553
  2,652
  2,756
  2,866
  2,705
  2,826
  2,953
  3,087
  3,227
  3,374
  3,529
  3,691
  3,862
  4,041
  4,229
  4,426
  4,634
  4,852
  5,081
  5,321
  5,574
  5,839
  6,117
  6,410
Retained Cash Flow (-), $m
  -9,526
  -565
  -606
  -636
  -667
  -700
  -735
  -771
  -809
  -849
  -891
  -935
  -982
  -1,031
  -1,082
  -1,136
  -1,192
  -1,251
  -1,314
  -1,379
  -1,448
  -1,520
  -1,596
  -1,676
  -1,759
  -1,847
  -1,939
  -2,036
  -2,138
  -2,244
  -2,356
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
 
  1,552
  1,574
  1,601
  1,630
  1,668
  1,723
  1,782
  1,843
  1,907
  1,975
  1,770
  1,844
  1,923
  2,005
  2,091
  2,182
  2,277
  2,377
  2,482
  2,593
  2,709
  2,830
  2,958
  3,093
  3,234
  3,382
  3,538
  3,701
  3,873
  4,053
Discount rate, %
 
  8.80
  9.24
  9.70
  10.19
  10.70
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.05
  15.80
  16.59
  17.42
  18.29
  19.21
  20.17
  21.18
  22.24
  23.35
  24.52
  25.74
  27.03
  28.38
  29.80
  31.29
  32.85
  34.50
  36.22
PV of cash for distribution, $m
 
  1,427
  1,319
  1,213
  1,106
  1,003
  910
  816
  724
  635
  549
  406
  343
  285
  234
  188
  148
  115
  87
  65
  47
  33
  23
  15
  10
  6
  4
  2
  1
  1
  0
Current shareholders' claim on cash, %
  100
  99.7
  99.4
  99.3
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2
  99.2

Newell Brands Inc. is a marketer of consumer and commercial products. The Company's segments include Writing, Home Solutions, Commercial Products, Baby & Parenting, Branded Consumables, Consumer Solutions, Outdoor Solutions and Process Solutions. Its products are marketed under a portfolio of brands, including Paper Mate, Sharpie, Dymo, Expo, Parker, Elmer's, Coleman, Jostens, Marmot, Rawlings, Mr. Coffee, Rubbermaid Commercial Products, Graco, Baby Jogger, NUK, Calphalon, Rubbermaid, Contigo, First Alert, Waddington and Yankee Candle. Writing segment consists of the Writing and Creative Expression business. Home Solutions segment designs, manufactures or sources and distributes a range of consumer products under various brand names. Commercial Products segment designs, manufactures or sources and distributes cleaning and refuse products. Its Baby & Parenting segment designs and distributes infant and juvenile products.

FINANCIAL RATIOS  of  Newell Brands (NWL)

Valuation Ratios
P/E Ratio 39.1
Price to Sales 1.6
Price to Book 1.8
Price to Tangible Book
Price to Cash Flow 11.3
Price to Free Cash Flow 14.9
Growth Rates
Sales Growth Rate 124.2%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 109%
Cap. Spend. - 3 Yr. Gr. Rate 26.2%
Financial Strength
Quick Ratio 1
Current Ratio 0.4
LT Debt to Equity 99.5%
Total Debt to Equity 104.8%
Interest Coverage 4
Management Effectiveness
Return On Assets 3.6%
Ret/ On Assets - 3 Yr. Avg. 5.4%
Return On Total Capital 3.8%
Ret/ On T. Cap. - 3 Yr. Avg. 6.8%
Return On Equity 8%
Return On Equity - 3 Yr. Avg. 15.4%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 33.2%
Gross Margin - 3 Yr. Avg. 36.9%
EBITDA Margin 11.8%
EBITDA Margin - 3 Yr. Avg. 11.2%
Operating Margin 7.9%
Oper. Margin - 3 Yr. Avg. 8.4%
Pre-Tax Margin 6.1%
Pre-Tax Margin - 3 Yr. Avg. 6.6%
Net Profit Margin 4%
Net Profit Margin - 3 Yr. Avg. 5.5%
Effective Tax Rate 35.1%
Eff/ Tax Rate - 3 Yr. Avg. 25.9%
Payout Ratio 62.3%

NWL stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the NWL stock intrinsic value calculation we used $13264 million for the last fiscal year's total revenue generated by Newell Brands. The default revenue input number comes from 2016 income statement of Newell Brands. 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 NWL stock valuation model: a) initial revenue growth rate of 5.1% 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 8.8%, whose default value for NWL is calculated based on our internal credit rating of Newell Brands, 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 Newell Brands.
    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 NWL stock the variable cost ratio is equal to 91.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $75 million in the base year in the intrinsic value calculation for NWL 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 4.2% for Newell Brands.

Corporate tax rate of 27% is the nominal tax rate for Newell Brands. 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 NWL 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 NWL are equal to 65.3%.

Life of production assets of 34.7 years is the average useful life of capital assets used in Newell Brands 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 NWL is equal to 24.2%. 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 - $11349 million for Newell Brands - 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 489.817 million for Newell Brands 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 Newell Brands at the current share price and the inputted number of shares is $20.9 billion.

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▶ ETFs with exposure to Newell Brands, Inc. : May 16, 2017   [May-16-17 12:57PM  Capital Cube]
▶ Newell Brands Can Muster the Strength to Break Out   [May-10-17 10:44AM  TheStreet.com]
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▶ Newell Brands: Cramer's Top Takeaways   [06:39AM  TheStreet.com]
Financial statements of NWL
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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