Intrinsic value of Scorpio Bulkers - SALT

Previous Close

$7.70

  Intrinsic Value

$2.93

stock screener

  Rating & Target

str. sell

-62%

  Value-price divergence*

-141%

Previous close

$7.70

 
Intrinsic value

$2.93

 
Up/down potential

-62%

 
Rating

str. sell

 
Value-price divergence*

-141%

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

We calculate the intrinsic value of SALT 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 0.6

 

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, %
  23.81
  23.80
  21.92
  20.23
  18.71
  17.33
  16.10
  14.99
  13.99
  13.09
  12.28
  11.56
  10.90
  10.31
  9.78
  9.30
  8.87
  8.48
  8.14
  7.82
  7.54
  7.29
  7.06
  6.85
  6.67
  6.50
  6.35
  6.21
  6.09
  5.98
  5.89
Revenue, $m
  78
  97
  118
  142
  168
  197
  229
  263
  300
  339
  381
  425
  471
  520
  571
  624
  679
  737
  797
  859
  924
  991
  1,061
  1,134
  1,209
  1,288
  1,370
  1,455
  1,544
  1,636
  1,732
Variable operating expenses, $m
 
  849
  1,035
  1,245
  1,478
  1,734
  2,013
  2,315
  2,639
  2,984
  3,351
  3,738
  4,145
  4,573
  5,020
  5,487
  5,974
  6,480
  7,008
  7,556
  8,125
  8,717
  9,333
  9,972
  10,637
  11,328
  12,047
  12,796
  13,576
  14,388
  15,235
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
  179
  849
  1,035
  1,245
  1,478
  1,734
  2,013
  2,315
  2,639
  2,984
  3,351
  3,738
  4,145
  4,573
  5,020
  5,487
  5,974
  6,480
  7,008
  7,556
  8,125
  8,717
  9,333
  9,972
  10,637
  11,328
  12,047
  12,796
  13,576
  14,388
  15,235
Operating income, $m
  -101
  -753
  -918
  -1,103
  -1,310
  -1,537
  -1,784
  -2,052
  -2,339
  -2,645
  -2,970
  -3,313
  -3,674
  -4,053
  -4,449
  -4,863
  -5,294
  -5,744
  -6,211
  -6,697
  -7,202
  -7,726
  -8,271
  -8,838
  -9,427
  -10,040
  -10,678
  -11,341
  -12,032
  -12,752
  -13,503
EBITDA, $m
  -64
  -753
  -918
  -1,103
  -1,310
  -1,537
  -1,784
  -2,052
  -2,339
  -2,645
  -2,970
  -3,313
  -3,674
  -4,053
  -4,449
  -4,863
  -5,294
  -5,744
  -6,211
  -6,697
  -7,202
  -7,726
  -8,271
  -8,838
  -9,427
  -10,040
  -10,678
  -11,341
  -12,032
  -12,752
  -13,503
Interest expense (income), $m
  23
  23
  67
  119
  176
  240
  310
  386
  469
  558
  653
  753
  859
  971
  1,088
  1,210
  1,338
  1,472
  1,611
  1,755
  1,905
  2,061
  2,224
  2,392
  2,568
  2,750
  2,939
  3,136
  3,341
  3,555
  3,778
Earnings before tax, $m
  -125
  -776
  -985
  -1,222
  -1,486
  -1,776
  -2,094
  -2,438
  -2,808
  -3,203
  -3,622
  -4,066
  -4,533
  -5,024
  -5,537
  -6,074
  -6,633
  -7,215
  -7,822
  -8,452
  -9,107
  -9,788
  -10,495
  -11,231
  -11,995
  -12,790
  -13,617
  -14,478
  -15,374
  -16,307
  -17,281
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
  -125
  -776
  -985
  -1,222
  -1,486
  -1,776
  -2,094
  -2,438
  -2,808
  -3,203
  -3,622
  -4,066
  -4,533
  -5,024
  -5,537
  -6,074
  -6,633
  -7,215
  -7,822
  -8,452
  -9,107
  -9,788
  -10,495
  -11,231
  -11,995
  -12,790
  -13,617
  -14,478
  -15,374
  -16,307
  -17,281

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  102
  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
  1,547
  1,788
  2,180
  2,621
  3,112
  3,651
  4,239
  4,874
  5,556
  6,284
  7,055
  7,871
  8,729
  9,628
  10,570
  11,553
  12,578
  13,645
  14,755
  15,909
  17,109
  18,355
  19,651
  20,997
  22,397
  23,852
  25,367
  26,943
  28,585
  30,295
  32,078
Adjusted assets (=assets-cash), $m
  1,445
  1,788
  2,180
  2,621
  3,112
  3,651
  4,239
  4,874
  5,556
  6,284
  7,055
  7,871
  8,729
  9,628
  10,570
  11,553
  12,578
  13,645
  14,755
  15,909
  17,109
  18,355
  19,651
  20,997
  22,397
  23,852
  25,367
  26,943
  28,585
  30,295
  32,078
Revenue / Adjusted assets
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
  0.054
Average production assets, $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
Working capital, $m
  90
  -15
  -18
  -22
  -26
  -30
  -35
  -41
  -46
  -52
  -59
  -65
  -73
  -80
  -88
  -96
  -105
  -113
  -123
  -132
  -142
  -153
  -163
  -175
  -186
  -198
  -211
  -224
  -238
  -252
  -267
Total debt, $m
  72
  212
  372
  551
  751
  972
  1,211
  1,471
  1,749
  2,046
  2,361
  2,693
  3,043
  3,410
  3,795
  4,196
  4,614
  5,049
  5,502
  5,973
  6,462
  6,971
  7,499
  8,049
  8,620
  9,214
  9,832
  10,475
  11,145
  11,843
  12,570
Total liabilities, $m
  591
  730
  890
  1,069
  1,269
  1,490
  1,729
  1,989
  2,267
  2,564
  2,879
  3,211
  3,561
  3,928
  4,313
  4,714
  5,132
  5,567
  6,020
  6,491
  6,980
  7,489
  8,017
  8,567
  9,138
  9,732
  10,350
  10,993
  11,663
  12,361
  13,088
Total equity, $m
  957
  1,059
  1,291
  1,552
  1,842
  2,161
  2,509
  2,885
  3,289
  3,720
  4,177
  4,659
  5,167
  5,700
  6,257
  6,839
  7,446
  8,078
  8,735
  9,418
  10,128
  10,866
  11,633
  12,430
  13,259
  14,121
  15,017
  15,950
  16,922
  17,935
  18,990
Total liabilities and equity, $m
  1,548
  1,789
  2,181
  2,621
  3,111
  3,651
  4,238
  4,874
  5,556
  6,284
  7,056
  7,870
  8,728
  9,628
  10,570
  11,553
  12,578
  13,645
  14,755
  15,909
  17,108
  18,355
  19,650
  20,997
  22,397
  23,853
  25,367
  26,943
  28,585
  30,296
  32,078
Debt-to-equity ratio
  0.075
  0.200
  0.290
  0.360
  0.410
  0.450
  0.480
  0.510
  0.530
  0.550
  0.570
  0.580
  0.590
  0.600
  0.610
  0.610
  0.620
  0.630
  0.630
  0.630
  0.640
  0.640
  0.640
  0.650
  0.650
  0.650
  0.650
  0.660
  0.660
  0.660
  0.660
Adjusted equity ratio
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592
  0.592

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -125
  -776
  -985
  -1,222
  -1,486
  -1,776
  -2,094
  -2,438
  -2,808
  -3,203
  -3,622
  -4,066
  -4,533
  -5,024
  -5,537
  -6,074
  -6,633
  -7,215
  -7,822
  -8,452
  -9,107
  -9,788
  -10,495
  -11,231
  -11,995
  -12,790
  -13,617
  -14,478
  -15,374
  -16,307
  -17,281
Depreciation, amort., depletion, $m
  37
  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
Funds from operations, $m
  -59
  -776
  -985
  -1,222
  -1,486
  -1,776
  -2,094
  -2,438
  -2,808
  -3,203
  -3,622
  -4,066
  -4,533
  -5,024
  -5,537
  -6,074
  -6,633
  -7,215
  -7,822
  -8,452
  -9,107
  -9,788
  -10,495
  -11,231
  -11,995
  -12,790
  -13,617
  -14,478
  -15,374
  -16,307
  -17,281
Change in working capital, $m
  -7
  -3
  -3
  -4
  -4
  -4
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -9
  -9
  -9
  -10
  -10
  -10
  -11
  -11
  -12
  -12
  -13
  -13
  -14
  -14
  -15
Cash from operations, $m
  -52
  -773
  -982
  -1,218
  -1,482
  -1,772
  -2,089
  -2,433
  -2,802
  -3,197
  -3,616
  -4,059
  -4,526
  -5,016
  -5,529
  -6,065
  -6,624
  -7,207
  -7,812
  -8,442
  -9,097
  -9,777
  -10,484
  -11,219
  -11,983
  -12,778
  -13,604
  -14,464
  -15,360
  -16,293
  -17,266
Maintenance CAPEX, $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
New CAPEX, $m
  -507
  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 from investing activities, $m
  -235
  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
Free cash flow, $m
  -287
  -773
  -982
  -1,218
  -1,482
  -1,772
  -2,089
  -2,433
  -2,802
  -3,197
  -3,616
  -4,059
  -4,526
  -5,016
  -5,529
  -6,065
  -6,624
  -7,207
  -7,812
  -8,442
  -9,097
  -9,777
  -10,484
  -11,219
  -11,983
  -12,778
  -13,604
  -14,464
  -15,360
  -16,293
  -17,266
Issuance/(repayment) of debt, $m
  62
  140
  160
  180
  200
  220
  240
  259
  278
  297
  315
  333
  350
  367
  384
  401
  418
  435
  453
  471
  489
  509
  528
  549
  571
  594
  618
  643
  670
  698
  727
Issuance/(repurchase) of shares, $m
  128
  979
  1,217
  1,483
  1,776
  2,096
  2,442
  2,814
  3,212
  3,634
  4,079
  4,549
  5,041
  5,556
  6,095
  6,656
  7,240
  7,847
  8,479
  9,135
  9,817
  10,526
  11,262
  12,028
  12,824
  13,652
  14,513
  15,411
  16,346
  17,320
  18,336
Cash from financing (excl. dividends), $m  
  189
  1,119
  1,377
  1,663
  1,976
  2,316
  2,682
  3,073
  3,490
  3,931
  4,394
  4,882
  5,391
  5,923
  6,479
  7,057
  7,658
  8,282
  8,932
  9,606
  10,306
  11,035
  11,790
  12,577
  13,395
  14,246
  15,131
  16,054
  17,016
  18,018
  19,063
Total cash flow (excl. dividends), $m
  -99
  346
  395
  445
  494
  544
  593
  641
  688
  734
  778
  822
  865
  907
  949
  991
  1,033
  1,076
  1,119
  1,164
  1,209
  1,257
  1,306
  1,358
  1,411
  1,468
  1,527
  1,590
  1,655
  1,725
  1,798
Retained Cash Flow (-), $m
  -22
  -979
  -1,217
  -1,483
  -1,776
  -2,096
  -2,442
  -2,814
  -3,212
  -3,634
  -4,079
  -4,549
  -5,041
  -5,556
  -6,095
  -6,656
  -7,240
  -7,847
  -8,479
  -9,135
  -9,817
  -10,526
  -11,262
  -12,028
  -12,824
  -13,652
  -14,513
  -15,411
  -16,346
  -17,320
  -18,336
Prev. year cash balance distribution, $m
 
  102
  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
 
  -531
  -822
  -1,038
  -1,282
  -1,552
  -1,849
  -2,174
  -2,524
  -2,900
  -3,301
  -3,727
  -4,176
  -4,649
  -5,145
  -5,664
  -6,206
  -6,771
  -7,359
  -7,971
  -8,608
  -9,269
  -9,956
  -10,670
  -11,412
  -12,184
  -12,986
  -13,821
  -14,690
  -15,595
  -16,538
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
 
  -509
  -753
  -904
  -1,055
  -1,203
  -1,342
  -1,468
  -1,578
  -1,666
  -1,731
  -1,770
  -1,782
  -1,768
  -1,727
  -1,663
  -1,577
  -1,473
  -1,355
  -1,227
  -1,094
  -959
  -826
  -699
  -581
  -474
  -379
  -297
  -227
  -170
  -125
Current shareholders' claim on cash, %
  100
  37.9
  14.4
  5.4
  2.1
  0.8
  0.3
  0.1
  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

Scorpio Bulkers Inc. is a shipping company. The Company owns and operates newbuilding drybulk carriers with fuel-efficient specifications and carrying capacities of greater than 30,000 deadweight tons (dwt). The Company operates through two segments: Kamsarmax and Ultramax. Its Kamsarmax segment includes vessels ranging from approximately 77,500 DWT to 98,700 DWT. Its Ultramax segment includes vessels ranging from approximately 60,200 DWT to 64,000 DWT. All of its owned vessels have carrying capacities of greater than 60,000 dwt. Its vessels transport a range of bulk commodities, including ores, coal, grains and fertilizers, along shipping routes, and are employed primarily in the spot market or in spot market-oriented pools of similarly sized vessels. As of December 31, 2016, its operating fleet of 48 vessels consisted of 47 drybulk vessels and one chartered-in drybulk vessel. It also has a contract for the construction of one newbuilding drybulk vessel.

FINANCIAL RATIOS  of  Scorpio Bulkers (SALT)

Valuation Ratios
P/E Ratio -4.6
Price to Sales 7.4
Price to Book 0.6
Price to Tangible Book
Price to Cash Flow -11.2
Price to Free Cash Flow -1
Growth Rates
Sales Growth Rate 23.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -47.6%
Cap. Spend. - 3 Yr. Gr. Rate 6.4%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 7.5%
Total Debt to Equity 7.5%
Interest Coverage -4
Management Effectiveness
Return On Assets -6.8%
Ret/ On Assets - 3 Yr. Avg. -17.3%
Return On Total Capital -12.3%
Ret/ On T. Cap. - 3 Yr. Avg. -22.3%
Return On Equity -13.2%
Return On Equity - 3 Yr. Avg. -23.7%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 46.9%
EBITDA Margin -83.3%
EBITDA Margin - 3 Yr. Avg. -362.8%
Operating Margin -129.5%
Oper. Margin - 3 Yr. Avg. -382.5%
Pre-Tax Margin -160.3%
Pre-Tax Margin - 3 Yr. Avg. -403.4%
Net Profit Margin -160.3%
Net Profit Margin - 3 Yr. Avg. -403.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

SALT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SALT stock intrinsic value calculation we used $78 million for the last fiscal year's total revenue generated by Scorpio Bulkers. The default revenue input number comes from 2016 income statement of Scorpio Bulkers. 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 SALT stock valuation model: a) initial revenue growth rate of 23.8% 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 4.3%, whose default value for SALT is calculated based on our internal credit rating of Scorpio Bulkers, 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 Scorpio Bulkers.
    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 SALT stock the variable cost ratio is equal to 879.5%.

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 SALT 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 31.9% for Scorpio Bulkers.

Corporate tax rate of 27% is the nominal tax rate for Scorpio Bulkers. 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 SALT 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 SALT are equal to 0%.

Life of production assets of 0 years is the average useful life of capital assets used in Scorpio Bulkers 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 SALT is equal to -15.4%. 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 - $957 million for Scorpio Bulkers - 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 81.79 million for Scorpio Bulkers 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 Scorpio Bulkers at the current share price and the inputted number of shares is $0.6 billion.

RELATED COMPANIES Price Int.Val. Rating
SHIP Seanergy Marit 1.22 2.77  str.buy
SB Safe Bulkers 3.24 1.27  str.sell
NMM Navios Maritim 2.12 1.09  sell
SBLK Star Bulk Carr 10.59 4.29  str.sell
DSX Diana Shipping 4.03 2.33  sell

COMPANY NEWS

▶ Scorpio Bulkers Inc. To Announce Third Quarter 2017 Results   [Oct-13-17 10:00AM  GlobeNewswire]
▶ [$$] Shipowners Rejoice Over Rising Demand for Commodities   [12:37AM  The Wall Street Journal]
▶ Why Scorpio Bulkers Inc Stock Tumbled 22% in May   [Jun-07-17 03:40PM  Motley Fool]
▶ Scorpio Bulkers reports 1Q loss   [07:38AM  Associated Press]
▶ Shipping stocks rocket after analyst calls the bottom   [Mar-29-17 07:36AM  MarketWatch]
▶ [$$] Finding Value in European Conglomerates   [Mar-18-17 12:16AM  at Barrons.com]
▶ Shipping Stocks Encounter Volatility   [Mar-16-17 03:39PM  Investopedia]
▶ Shipping Stocks Encounter Volatility   [03:39PM  at Investopedia]
▶ Why Scorpio Bulkers Inc. Stock Sailed 42% in January   [Feb-06-17 03:15PM  at Motley Fool]
▶ Why Shipping Stocks Surged -- and DryShips Dropped -- Today   [Jan-18-17 07:56PM  at Motley Fool]
▶ Is Scorpio Bulkers Inc (SALT) a Good Stock to Buy?   [01:35AM  at Insider Monkey]
▶ [$$] Dry-Bulk Shipping Owners Get Reprieve as Rates Rebound   [Nov-25-16 12:16AM  at The Wall Street Journal]
▶ [$$] Dry-Bulk Shipping Owners Get Reprieve as Rates Rebound   [Nov-24-16 12:54AM  at The Wall Street Journal]
▶ Why Small Stocks Are Fueling Giant Returns   [02:16PM  at Investopedia]
▶ DryShips: What the Heck Is Going On?!?!   [10:19AM  at Barrons.com]
▶ Why Scorpio Bulkers Stock Shot to the Stars Friday   [Nov-11-16 06:47PM  at Motley Fool]
Financial statements of SALT
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.

FREE DOWNLOAD
Follow us on:   twitter   twitter   twitter   twitter

VALUATION THEORY       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2017. All rigths reserved.