Intrinsic value of PDL BioPharma - PDLI

Previous Close

$3.50

  Intrinsic Value

$136.63

stock screener

  Rating & Target

str. buy

+999%

Previous close

$3.50

 
Intrinsic value

$136.63

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of PDLI 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 0.5

 

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, %
  -58.64
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  244
  390
  603
  902
  1,309
  1,847
  2,539
  3,408
  4,474
  5,757
  7,272
  9,030
  11,040
  13,307
  15,833
  18,617
  21,656
  24,945
  28,481
  32,256
  36,265
  40,503
  44,966
  49,650
  54,553
  59,674
  65,014
  70,574
  76,360
  82,376
  88,629
Variable operating expenses, $m
 
  22
  34
  51
  75
  105
  145
  194
  255
  328
  415
  515
  629
  759
  902
  1,061
  1,234
  1,422
  1,623
  1,839
  2,067
  2,309
  2,563
  2,830
  3,110
  3,401
  3,706
  4,023
  4,353
  4,695
  5,052
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
  117
  22
  34
  51
  75
  105
  145
  194
  255
  328
  415
  515
  629
  759
  902
  1,061
  1,234
  1,422
  1,623
  1,839
  2,067
  2,309
  2,563
  2,830
  3,110
  3,401
  3,706
  4,023
  4,353
  4,695
  5,052
Operating income, $m
  127
  368
  569
  851
  1,234
  1,741
  2,394
  3,213
  4,219
  5,429
  6,857
  8,515
  10,411
  12,549
  14,930
  17,555
  20,421
  23,524
  26,857
  30,417
  34,198
  38,195
  42,403
  46,820
  51,443
  56,272
  61,308
  66,552
  72,008
  77,681
  83,577
EBITDA, $m
  139
  396
  611
  914
  1,326
  1,871
  2,573
  3,453
  4,534
  5,834
  7,369
  9,151
  11,188
  13,485
  16,044
  18,865
  21,945
  25,279
  28,861
  32,687
  36,750
  41,045
  45,567
  50,314
  55,282
  60,471
  65,883
  71,518
  77,381
  83,477
  89,814
Interest expense (income), $m
  11
  10
  23
  41
  67
  101
  147
  207
  281
  372
  482
  611
  762
  934
  1,128
  1,344
  1,582
  1,841
  2,123
  2,425
  2,748
  3,091
  3,453
  3,835
  4,236
  4,655
  5,093
  5,549
  6,025
  6,520
  7,034
Earnings before tax, $m
  109
  358
  546
  809
  1,168
  1,640
  2,246
  3,007
  3,938
  5,057
  6,376
  7,904
  9,649
  11,615
  13,803
  16,212
  18,840
  21,682
  24,735
  27,992
  31,450
  35,104
  38,950
  42,985
  47,208
  51,617
  56,215
  61,002
  65,983
  71,161
  76,543
Tax expense, $m
  45
  97
  147
  219
  315
  443
  607
  812
  1,063
  1,365
  1,721
  2,134
  2,605
  3,136
  3,727
  4,377
  5,087
  5,854
  6,678
  7,558
  8,492
  9,478
  10,516
  11,606
  12,746
  13,937
  15,178
  16,471
  17,815
  19,214
  20,667
Net income, $m
  64
  261
  398
  591
  852
  1,197
  1,640
  2,195
  2,875
  3,692
  4,654
  5,770
  7,044
  8,479
  10,076
  11,835
  13,753
  15,828
  18,056
  20,434
  22,959
  25,626
  28,433
  31,379
  34,462
  37,681
  41,037
  44,532
  48,167
  51,948
  55,876

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  242
  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
  1,215
  1,555
  2,403
  3,594
  5,214
  7,357
  10,114
  13,576
  17,826
  22,937
  28,972
  35,976
  43,985
  53,016
  63,079
  74,170
  86,277
  99,384
  113,469
  128,510
  144,483
  161,368
  179,148
  197,809
  217,341
  237,744
  259,018
  281,173
  304,225
  328,193
  353,104
Adjusted assets (=assets-cash), $m
  973
  1,555
  2,403
  3,594
  5,214
  7,357
  10,114
  13,576
  17,826
  22,937
  28,972
  35,976
  43,985
  53,016
  63,079
  74,170
  86,277
  99,384
  113,469
  128,510
  144,483
  161,368
  179,148
  197,809
  217,341
  237,744
  259,018
  281,173
  304,225
  328,193
  353,104
Revenue / Adjusted assets
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
  0.251
Average production assets, $m
  515
  824
  1,273
  1,904
  2,763
  3,898
  5,359
  7,193
  9,445
  12,154
  15,351
  19,063
  23,306
  28,091
  33,423
  39,300
  45,715
  52,660
  60,123
  68,092
  76,556
  85,503
  94,924
  104,811
  115,161
  125,971
  137,244
  148,983
  161,197
  173,896
  187,096
Working capital, $m
  268
  42
  65
  97
  140
  198
  272
  365
  479
  616
  778
  966
  1,181
  1,424
  1,694
  1,992
  2,317
  2,669
  3,047
  3,451
  3,880
  4,334
  4,811
  5,313
  5,837
  6,385
  6,956
  7,551
  8,171
  8,814
  9,483
Total debt, $m
  232
  510
  914
  1,482
  2,255
  3,277
  4,592
  6,244
  8,271
  10,709
  13,588
  16,929
  20,749
  25,057
  29,857
  35,147
  40,922
  47,174
  53,893
  61,067
  68,686
  76,741
  85,222
  94,123
  103,440
  113,172
  123,320
  133,888
  144,883
  156,316
  168,199
Total liabilities, $m
  464
  742
  1,146
  1,714
  2,487
  3,509
  4,824
  6,476
  8,503
  10,941
  13,820
  17,161
  20,981
  25,289
  30,089
  35,379
  41,154
  47,406
  54,125
  61,299
  68,918
  76,973
  85,454
  94,355
  103,672
  113,404
  123,552
  134,120
  145,115
  156,548
  168,431
Total equity, $m
  751
  813
  1,257
  1,880
  2,727
  3,848
  5,290
  7,100
  9,323
  11,996
  15,152
  18,816
  23,004
  27,728
  32,990
  38,791
  45,123
  51,978
  59,344
  67,211
  75,565
  84,396
  93,694
  103,454
  113,670
  124,340
  135,466
  147,054
  159,109
  171,645
  184,674
Total liabilities and equity, $m
  1,215
  1,555
  2,403
  3,594
  5,214
  7,357
  10,114
  13,576
  17,826
  22,937
  28,972
  35,977
  43,985
  53,017
  63,079
  74,170
  86,277
  99,384
  113,469
  128,510
  144,483
  161,369
  179,148
  197,809
  217,342
  237,744
  259,018
  281,174
  304,224
  328,193
  353,105
Debt-to-equity ratio
  0.309
  0.630
  0.730
  0.790
  0.830
  0.850
  0.870
  0.880
  0.890
  0.890
  0.900
  0.900
  0.900
  0.900
  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
Adjusted equity ratio
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523
  0.523

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  64
  261
  398
  591
  852
  1,197
  1,640
  2,195
  2,875
  3,692
  4,654
  5,770
  7,044
  8,479
  10,076
  11,835
  13,753
  15,828
  18,056
  20,434
  22,959
  25,626
  28,433
  31,379
  34,462
  37,681
  41,037
  44,532
  48,167
  51,948
  55,876
Depreciation, amort., depletion, $m
  12
  27
  42
  63
  92
  130
  179
  240
  315
  405
  512
  635
  777
  936
  1,114
  1,310
  1,524
  1,755
  2,004
  2,270
  2,552
  2,850
  3,164
  3,494
  3,839
  4,199
  4,575
  4,966
  5,373
  5,797
  6,237
Funds from operations, $m
  88
  289
  441
  654
  944
  1,327
  1,819
  2,435
  3,190
  4,097
  5,166
  6,405
  7,821
  9,415
  11,190
  13,145
  15,277
  17,583
  20,060
  22,704
  25,510
  28,476
  31,597
  34,873
  38,300
  41,880
  45,612
  49,498
  53,541
  57,744
  62,113
Change in working capital, $m
  -14
  16
  23
  32
  44
  58
  74
  93
  114
  137
  162
  188
  215
  243
  270
  298
  325
  352
  378
  404
  429
  453
  478
  501
  525
  548
  571
  595
  619
  644
  669
Cash from operations, $m
  102
  273
  418
  622
  901
  1,269
  1,744
  2,342
  3,076
  3,959
  5,004
  6,217
  7,606
  9,173
  10,920
  12,847
  14,952
  17,231
  19,682
  22,300
  25,081
  28,022
  31,120
  34,372
  37,776
  41,332
  45,040
  48,903
  52,922
  57,100
  61,444
Maintenance CAPEX, $m
  0
  -17
  -27
  -42
  -63
  -92
  -130
  -179
  -240
  -315
  -405
  -512
  -635
  -777
  -936
  -1,114
  -1,310
  -1,524
  -1,755
  -2,004
  -2,270
  -2,552
  -2,850
  -3,164
  -3,494
  -3,839
  -4,199
  -4,575
  -4,966
  -5,373
  -5,797
New CAPEX, $m
  -60
  -309
  -449
  -631
  -859
  -1,135
  -1,461
  -1,834
  -2,252
  -2,708
  -3,197
  -3,711
  -4,243
  -4,786
  -5,332
  -5,877
  -6,415
  -6,945
  -7,463
  -7,969
  -8,464
  -8,947
  -9,421
  -9,887
  -10,350
  -10,810
  -11,272
  -11,739
  -12,214
  -12,700
  -13,200
Cash from investing activities, $m
  -145
  -326
  -476
  -673
  -922
  -1,227
  -1,591
  -2,013
  -2,492
  -3,023
  -3,602
  -4,223
  -4,878
  -5,563
  -6,268
  -6,991
  -7,725
  -8,469
  -9,218
  -9,973
  -10,734
  -11,499
  -12,271
  -13,051
  -13,844
  -14,649
  -15,471
  -16,314
  -17,180
  -18,073
  -18,997
Free cash flow, $m
  -43
  -53
  -58
  -51
  -21
  42
  154
  329
  584
  936
  1,401
  1,994
  2,727
  3,610
  4,652
  5,856
  7,226
  8,763
  10,464
  12,327
  14,348
  16,524
  18,849
  21,320
  23,932
  26,683
  29,569
  32,589
  35,742
  39,028
  42,448
Issuance/(repayment) of debt, $m
  5
  278
  404
  568
  773
  1,022
  1,315
  1,651
  2,027
  2,438
  2,878
  3,341
  3,820
  4,308
  4,800
  5,290
  5,775
  6,252
  6,719
  7,174
  7,619
  8,054
  8,481
  8,901
  9,317
  9,732
  10,148
  10,568
  10,995
  11,433
  11,883
Issuance/(repurchase) of shares, $m
  0
  43
  45
  32
  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  
  -12
  321
  449
  600
  773
  1,022
  1,315
  1,651
  2,027
  2,438
  2,878
  3,341
  3,820
  4,308
  4,800
  5,290
  5,775
  6,252
  6,719
  7,174
  7,619
  8,054
  8,481
  8,901
  9,317
  9,732
  10,148
  10,568
  10,995
  11,433
  11,883
Total cash flow (excl. dividends), $m
  -55
  268
  391
  549
  752
  1,064
  1,469
  1,980
  2,611
  3,374
  4,280
  5,335
  6,547
  7,918
  9,452
  11,146
  13,002
  15,015
  17,182
  19,501
  21,967
  24,578
  27,330
  30,221
  33,249
  36,415
  39,717
  43,157
  46,737
  50,460
  54,331
Retained Cash Flow (-), $m
  -55
  -304
  -443
  -623
  -848
  -1,120
  -1,442
  -1,811
  -2,223
  -2,673
  -3,156
  -3,663
  -4,188
  -4,724
  -5,263
  -5,800
  -6,332
  -6,855
  -7,367
  -7,866
  -8,354
  -8,831
  -9,299
  -9,759
  -10,216
  -10,670
  -11,126
  -11,587
  -12,056
  -12,535
  -13,029
Prev. year cash balance distribution, $m
 
  242
  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
 
  205
  -53
  -74
  -96
  -56
  27
  169
  388
  701
  1,124
  1,672
  2,359
  3,195
  4,189
  5,346
  6,669
  8,160
  9,816
  11,635
  13,613
  15,747
  18,031
  20,462
  23,034
  25,744
  28,590
  31,570
  34,681
  37,925
  41,302
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  197
  -48
  -64
  -79
  -44
  19
  114
  243
  403
  589
  794
  1,006
  1,215
  1,406
  1,569
  1,695
  1,775
  1,808
  1,791
  1,730
  1,629
  1,496
  1,341
  1,173
  1,001
  834
  678
  537
  414
  311
Current shareholders' claim on cash, %
  100
  89.4
  83.0
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2
  80.2

PDL BioPharma, Inc. seeks to provide return for its shareholders by acquiring and managing a portfolio of companies, products, royalty agreements and debt facilities in the biotechnology, pharmaceutical and medical device industries. The Company's segments include income generating assets and product sales. The income generating assets segment consists of royalties from issued patents in the United States and elsewhere, covering the humanization of antibodies, which it refers to as the Queen et al. patents; notes and other long-term receivables, royalty rights-at fair value and equity investments. The Company's product sales segment consists of revenue derived from Tekturna, Tekturna HCT, Rasilez and Rasilez HCT (collectively, the Noden Products or Tekturna) sales. It is focused on the acquisition of additional products. As of December 31, 2016, it had a total of five notes receivable transactions outstanding and one note/royalty (hybrid) receivable transaction outstanding.

FINANCIAL RATIOS  of  PDL BioPharma (PDLI)

Valuation Ratios
P/E Ratio 9.1
Price to Sales 2.4
Price to Book 0.8
Price to Tangible Book
Price to Cash Flow 5.7
Price to Free Cash Flow 13.8
Growth Rates
Sales Growth Rate -58.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -47.8%
Cap. Spend. - 3 Yr. Gr. Rate -24.3%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 30.9%
Total Debt to Equity 30.9%
Interest Coverage 11
Management Effectiveness
Return On Assets 6.3%
Ret/ On Assets - 3 Yr. Avg. 28.5%
Return On Total Capital 6.6%
Ret/ On T. Cap. - 3 Yr. Avg. 29.2%
Return On Equity 8.8%
Return On Equity - 3 Yr. Avg. 59.6%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 98.4%
Gross Margin - 3 Yr. Avg. 32.8%
EBITDA Margin 54.1%
EBITDA Margin - 3 Yr. Avg. 78.7%
Operating Margin 52%
Oper. Margin - 3 Yr. Avg. 79.7%
Pre-Tax Margin 44.7%
Pre-Tax Margin - 3 Yr. Avg. 73.6%
Net Profit Margin 26.2%
Net Profit Margin - 3 Yr. Avg. 46%
Effective Tax Rate 41.3%
Eff/ Tax Rate - 3 Yr. Avg. 38.1%
Payout Ratio 26.6%

PDLI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the PDLI stock intrinsic value calculation we used $244 million for the last fiscal year's total revenue generated by PDL BioPharma. The default revenue input number comes from 2016 income statement of PDL BioPharma. 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 PDLI stock valuation model: a) initial revenue growth rate of 60% 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 4.3%, whose default value for PDLI is calculated based on our internal credit rating of PDL BioPharma, 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 PDL BioPharma.
    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 PDLI stock the variable cost ratio is equal to 5.7%.

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 PDLI 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 4.5% for PDL BioPharma.

Corporate tax rate of 27% is the nominal tax rate for PDL BioPharma. 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 PDLI 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 PDLI are equal to 211.1%.

Life of production assets of 42.9 years is the average useful life of capital assets used in PDL BioPharma 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 PDLI is equal to 10.7%. 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 - $751 million for PDL BioPharma - 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 154.08 million for PDL BioPharma 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 PDL BioPharma at the current share price and the inputted number of shares is $0.5 billion.

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COMPANY NEWS

▶ PDL BioPharma Appoints Dominique Monnet as President   [Sep-11-17 04:02PM  PR Newswire]
▶ Here's Why PDL BioPharma Inc. Is Soaring Today   [Aug-04-17 12:51PM  Motley Fool]
▶ ETFs with exposure to PDL BioPharma, Inc. : July 24, 2017   [Jul-24-17 06:00PM  Capital Cube]
▶ ETFs with exposure to PDL BioPharma, Inc. : July 13, 2017   [Jul-13-17 04:26PM  Capital Cube]
▶ ETFs with exposure to PDL BioPharma, Inc. : July 3, 2017   [Jul-03-17 03:40PM  Capital Cube]
▶ ETFs with exposure to PDL BioPharma, Inc. : June 20, 2017   [Jun-20-17 03:11PM  Capital Cube]
▶ Noden Pharma Notified of ANDA Filing for Tekturna®   [Jun-05-17 07:00AM  PR Newswire]
▶ PDL BioPharma posts 1Q profit   [May-03-17 05:32PM  Associated Press]
▶ Better Buy: PDL BioPharma, Inc. vs. Johnson & Johnson   [Feb-27-17 09:50AM  at Motley Fool]
▶ 9 Top Pharmaceutical Stocks to Buy for the Dividends   [Feb-15-17 09:30AM  at Kiplinger]
▶ [$$] Medical-Device Company Enters Chapter 11   [Dec-19-16 04:56PM  at The Wall Street Journal]
▶ Is Vera Bradley, Inc. (VRA) Worthy of Your Portfolio?   [Dec-12-16 09:44AM  at Insider Monkey]
▶ Pace Holdings Corp (PACE): Hedge Fund Sentiment Unchanged   [Dec-08-16 07:39AM  at Insider Monkey]
▶ Fitbit, Vodafone Sink into Tuesdays 52-Week Low Club   [Nov-29-16 04:04PM  at 24/7 Wall St.]
Financial statements of PDLI
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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