Intrinsic value of Protalix BioTherapeutics - PLX

Previous Close

$0.71

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$0.71

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of PLX 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 2012), $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 0.3

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2012(a)
   2013
   2014
   2015
   2016
   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

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  1,033.33
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  34
  35
  35
  36
  37
  39
  40
  41
  43
  44
  46
  48
  50
  52
  54
  56
  59
  61
  64
  67
  70
  73
  77
  80
  84
  88
  92
  97
  101
  106
  112
Variable operating expenses, $m
 
  106
  109
  111
  114
  118
  122
  126
  130
  135
  140
  146
  152
  158
  165
  172
  180
  187
  196
  205
  214
  224
  235
  246
  257
  270
  282
  296
  310
  325
  341
Fixed operating expenses, $m
 
  39
  40
  41
  42
  43
  44
  45
  46
  47
  49
  50
  51
  52
  54
  55
  56
  58
  59
  61
  62
  64
  65
  67
  69
  70
  72
  74
  76
  78
  80
Total operating expenses, $m
  47
  145
  149
  152
  156
  161
  166
  171
  176
  182
  189
  196
  203
  210
  219
  227
  236
  245
  255
  266
  276
  288
  300
  313
  326
  340
  354
  370
  386
  403
  421
Operating income, $m
  -12
  -110
  -113
  -116
  -119
  -122
  -126
  -130
  -134
  -138
  -143
  -148
  -153
  -159
  -165
  -171
  -177
  -184
  -191
  -199
  -206
  -215
  -223
  -232
  -242
  -252
  -262
  -273
  -285
  -297
  -309
EBITDA, $m
  -8
  -107
  -109
  -112
  -115
  -119
  -122
  -126
  -130
  -134
  -139
  -143
  -148
  -154
  -159
  -165
  -171
  -178
  -185
  -192
  -199
  -207
  -216
  -224
  -234
  -243
  -253
  -264
  -275
  -286
  -298
Interest expense (income), $m
  0
  0
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  0
  0
  0
Earnings before tax, $m
  -12
  -110
  -111
  -114
  -117
  -120
  -124
  -128
  -132
  -137
  -141
  -146
  -152
  -157
  -163
  -169
  -176
  -183
  -190
  -197
  -205
  -214
  -222
  -231
  -241
  -251
  -262
  -273
  -284
  -296
  -309
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -12
  -110
  -111
  -114
  -117
  -120
  -124
  -128
  -132
  -137
  -141
  -146
  -152
  -157
  -163
  -169
  -176
  -183
  -190
  -197
  -205
  -214
  -222
  -231
  -241
  -251
  -262
  -273
  -284
  -296
  -309

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  52
  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
  79
  28
  28
  29
  30
  31
  32
  33
  34
  35
  36
  38
  39
  41
  43
  45
  47
  49
  51
  53
  56
  58
  61
  64
  67
  70
  73
  77
  81
  84
  89
Adjusted assets (=assets-cash), $m
  27
  28
  28
  29
  30
  31
  32
  33
  34
  35
  36
  38
  39
  41
  43
  45
  47
  49
  51
  53
  56
  58
  61
  64
  67
  70
  73
  77
  81
  84
  89
Revenue / Adjusted assets
  1.259
  1.250
  1.250
  1.241
  1.233
  1.258
  1.250
  1.242
  1.265
  1.257
  1.278
  1.263
  1.282
  1.268
  1.256
  1.244
  1.255
  1.245
  1.255
  1.264
  1.250
  1.259
  1.262
  1.250
  1.254
  1.257
  1.260
  1.260
  1.247
  1.262
  1.258
Average production assets, $m
  17
  17
  18
  18
  19
  19
  20
  21
  21
  22
  23
  24
  25
  26
  27
  28
  29
  31
  32
  33
  35
  37
  38
  40
  42
  44
  46
  48
  51
  53
  56
Working capital, $m
  35
  -17
  -18
  -18
  -19
  -19
  -20
  -21
  -21
  -22
  -23
  -24
  -25
  -26
  -27
  -28
  -29
  -31
  -32
  -33
  -35
  -37
  -38
  -40
  -42
  -44
  -46
  -48
  -51
  -53
  -56
Total debt, $m
  0
  -57
  -57
  -56
  -55
  -54
  -54
  -53
  -52
  -50
  -49
  -48
  -47
  -45
  -43
  -42
  -40
  -38
  -36
  -34
  -32
  -30
  -27
  -25
  -22
  -19
  -16
  -13
  -9
  -6
  -2
Total liabilities, $m
  82
  25
  25
  26
  27
  28
  28
  29
  30
  32
  33
  34
  35
  37
  39
  40
  42
  44
  46
  48
  50
  52
  55
  57
  60
  63
  66
  69
  73
  76
  80
Total equity, $m
  -3
  3
  3
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  6
  6
  6
  6
  7
  7
  7
  8
  8
  8
  9
Total liabilities and equity, $m
  79
  28
  28
  29
  30
  31
  31
  32
  33
  36
  37
  38
  39
  41
  43
  44
  47
  49
  51
  53
  56
  58
  61
  63
  67
  70
  73
  77
  81
  84
  89
Debt-to-equity ratio
  0.000
  -20.770
  -20.100
  -19.370
  -18.590
  -17.780
  -16.940
  -16.090
  -15.230
  -14.360
  -13.500
  -12.640
  -11.800
  -10.970
  -10.160
  -9.360
  -8.590
  -7.840
  -7.120
  -6.420
  -5.740
  -5.090
  -4.460
  -3.850
  -3.270
  -2.720
  -2.180
  -1.670
  -1.180
  -0.710
  -0.260
Adjusted equity ratio
  -2.037
  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
  -12
  -110
  -111
  -114
  -117
  -120
  -124
  -128
  -132
  -137
  -141
  -146
  -152
  -157
  -163
  -169
  -176
  -183
  -190
  -197
  -205
  -214
  -222
  -231
  -241
  -251
  -262
  -273
  -284
  -296
  -309
Depreciation, amort., depletion, $m
  4
  3
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
  6
  6
  7
  7
  7
  8
  8
  8
  9
  9
  10
  10
  11
  11
Funds from operations, $m
  2
  -107
  -107
  -110
  -113
  -117
  -120
  -124
  -128
  -132
  -137
  -142
  -147
  -152
  -158
  -164
  -170
  -176
  -183
  -191
  -198
  -206
  -215
  -223
  -233
  -242
  -252
  -263
  -274
  -286
  -298
Change in working capital, $m
  1
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
Cash from operations, $m
  1
  -107
  -107
  -110
  -113
  -116
  -119
  -123
  -127
  -131
  -136
  -141
  -146
  -151
  -157
  -162
  -169
  -175
  -182
  -189
  -197
  -205
  -213
  -222
  -231
  -240
  -250
  -261
  -272
  -283
  -295
Maintenance CAPEX, $m
  0
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -8
  -9
  -9
  -10
  -10
  -11
New CAPEX, $m
  -2
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
Cash from investing activities, $m
  -2
  -3
  -3
  -4
  -5
  -5
  -5
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -6
  -6
  -7
  -7
  -7
  -7
  -9
  -9
  -9
  -10
  -10
  -10
  -11
  -11
  -12
  -12
  -14
Free cash flow, $m
  -1
  -110
  -111
  -114
  -117
  -120
  -124
  -128
  -132
  -136
  -141
  -146
  -151
  -157
  -163
  -169
  -176
  -182
  -190
  -197
  -205
  -213
  -222
  -231
  -241
  -251
  -261
  -272
  -284
  -296
  -309
Issuance/(repayment) of debt, $m
  0
  -57
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
Issuance/(repurchase) of shares, $m
  27
  168
  111
  114
  117
  121
  124
  128
  132
  137
  142
  147
  152
  157
  163
  169
  176
  183
  190
  198
  206
  214
  223
  232
  241
  251
  262
  273
  285
  297
  310
Cash from financing (excl. dividends), $m  
  27
  111
  112
  115
  118
  122
  125
  129
  133
  138
  143
  148
  153
  158
  165
  171
  178
  185
  192
  200
  208
  216
  225
  235
  244
  254
  265
  276
  288
  301
  314
Total cash flow (excl. dividends), $m
  25
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  5
Retained Cash Flow (-), $m
  -23
  -168
  -111
  -114
  -117
  -121
  -124
  -128
  -132
  -137
  -142
  -147
  -152
  -157
  -163
  -169
  -176
  -183
  -190
  -198
  -206
  -214
  -223
  -232
  -241
  -251
  -262
  -273
  -285
  -297
  -310
Prev. year cash balance distribution, $m
 
  52
  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
 
  -115
  -110
  -113
  -116
  -120
  -123
  -127
  -131
  -135
  -140
  -145
  -150
  -156
  -161
  -167
  -174
  -180
  -188
  -195
  -203
  -211
  -220
  -229
  -238
  -248
  -258
  -269
  -280
  -292
  -305
Discount rate, %
 
  5.90
  6.20
  6.50
  6.83
  7.17
  7.53
  7.91
  8.30
  8.72
  9.15
  9.61
  10.09
  10.60
  11.13
  11.68
  12.27
  12.88
  13.52
  14.20
  14.91
  15.65
  16.44
  17.26
  18.12
  19.03
  19.98
  20.98
  22.03
  23.13
  24.29
PV of cash for distribution, $m
 
  -109
  -98
  -94
  -89
  -85
  -80
  -75
  -69
  -64
  -58
  -53
  -47
  -42
  -37
  -32
  -27
  -23
  -19
  -16
  -13
  -10
  -8
  -6
  -4
  -3
  -2
  -2
  -1
  -1
  0
Current shareholders' claim on cash, %
  100
  50.0
  1.2
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Protalix BioTherapeutics, Inc. is a biopharmaceutical company. The Company is focused on the development and commercialization of recombinant therapeutic proteins based on its ProCellEx protein expression system (ProCellEx). The Company has developed taliglucerase alfa (marketed under the name Uplyso in Brazil and certain other Latin American countries and Elelyso in the rest of the territories) for the treatment of Gaucher disease that has been approved for marketing in the United States, Brazil, Israel and other markets. The Company's product pipeline includes PRX-102 for the treatment of Fabry disease; AIR DNase (PRX-110) for Cystic Fibrosis, and Oral Anti-TNF (OPRX-106) Anti Inflammatory. PRX-102 or alpha-GAL-A is an enzyme replacement therapy product for the treatment of Fabry disease. AIR DNase is a plant cell recombinant human Deoxyribonuclease 1. Oral Anti-TNF represents a mode of administering a recombinant anti-TNF protein. _tck('aft');

FINANCIAL RATIOS  of  Protalix BioTherapeutics (PLX)

Valuation Ratios
P/E Ratio -5.5
Price to Sales 2
Price to Book -22.1
Price to Tangible Book
Price to Cash Flow 66.4
Price to Free Cash Flow -66.4
Growth Rates
Sales Growth Rate 1033.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -66.7%
Cap. Spend. - 3 Yr. Gr. Rate -19.7%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -18.3%
Ret/ On Assets - 3 Yr. Avg. -45.6%
Return On Total Capital 82.8%
Ret/ On T. Cap. - 3 Yr. Avg. -388.3%
Return On Equity 82.8%
Return On Equity - 3 Yr. Avg. -388.3%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 76.5%
Gross Margin - 3 Yr. Avg. 57.8%
EBITDA Margin -23.5%
EBITDA Margin - 3 Yr. Avg. -544.2%
Operating Margin -38.2%
Oper. Margin - 3 Yr. Avg. -605.7%
Pre-Tax Margin -35.3%
Pre-Tax Margin - 3 Yr. Avg. -601.7%
Net Profit Margin -35.3%
Net Profit Margin - 3 Yr. Avg. -601.7%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

PLX stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the PLX stock intrinsic value calculation we used $34 million for the last fiscal year's total revenue generated by Protalix BioTherapeutics. The default revenue input number comes from 2012 income statement of Protalix BioTherapeutics. 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 PLX stock valuation model: a) initial revenue growth rate of 2% 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 5.9%, whose default value for PLX is calculated based on our internal credit rating of Protalix BioTherapeutics, 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 Protalix BioTherapeutics.
    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 PLX stock the variable cost ratio is equal to 305.9%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $38 million in the base year in the intrinsic value calculation for PLX 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 3.5% for Protalix BioTherapeutics.

Corporate tax rate of 27% is the nominal tax rate for Protalix BioTherapeutics. 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 PLX 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 PLX are equal to 50%.

Life of production assets of 4.3 years is the average useful life of capital assets used in Protalix BioTherapeutics 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 PLX is equal to -50%. 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 - $-3 million for Protalix BioTherapeutics - 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 470.722 million for Protalix BioTherapeutics 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 Protalix BioTherapeutics at the current share price and the inputted number of shares is $0.3 billion.

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COMPANY NEWS

▶ Protalix posts 2Q profit   [12:18AM  Associated Press]
▶ LD Micro Index Reconstitution as of August 1, 2017   [Aug-01-17 09:40AM  ACCESSWIRE]
▶ Protalix reports 1Q loss   [May-10-17 07:40AM  Associated Press]
▶ FitBit, Teva Slide into Mondays 52-Week Low Club   [Dec-05-16 04:04PM  at 24/7 Wall St.]
▶ Coty, Fitbit Fall into Fridays 52-Week Low Club   [Dec-02-16 04:04PM  at 24/7 Wall St.]
▶ Protalix BioTherapeutics Announces Investor Call   [Dec-01-16 05:00PM  GlobeNewswire]
▶ IIROC Trading Resumption - PLX   [04:35PM  PR Newswire]
Financial statements of PLX
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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