Intrinsic value of Shaw Communications Cl B NV - SJR

Previous Close

$22.06

  Intrinsic Value

$13.28

stock screener

  Rating & Target

sell

-40%

  Value-price divergence*

+42%

Previous close

$22.06

 
Intrinsic value

$13.28

 
Up/down potential

-40%

 
Rating

sell

 
Value-price divergence*

+42%

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

We calculate the intrinsic value of SJR 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 10.7

 

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, %
  8.89
  13.30
  12.47
  11.72
  11.05
  10.45
  9.90
  9.41
  8.97
  8.57
  8.22
  7.89
  7.60
  7.34
  7.11
  6.90
  6.71
  6.54
  6.38
  6.25
  6.12
  6.01
  5.91
  5.82
  5.74
  5.66
  5.60
  5.54
  5.48
  5.43
  5.39
Revenue, $m
  3,615
  4,096
  4,607
  5,147
  5,715
  6,312
  6,937
  7,590
  8,271
  8,980
  9,718
  10,485
  11,282
  12,111
  12,972
  13,867
  14,797
  15,765
  16,771
  17,818
  18,909
  20,045
  21,230
  22,465
  23,753
  25,098
  26,503
  27,970
  29,503
  31,107
  32,784
Variable operating expenses, $m
 
  3,067
  3,437
  3,829
  4,241
  4,674
  5,127
  5,601
  6,094
  6,609
  7,144
  7,602
  8,181
  8,781
  9,406
  10,055
  10,729
  11,431
  12,160
  12,920
  13,711
  14,535
  15,393
  16,289
  17,223
  18,198
  19,217
  20,281
  21,392
  22,555
  23,771
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
  2,804
  3,067
  3,437
  3,829
  4,241
  4,674
  5,127
  5,601
  6,094
  6,609
  7,144
  7,602
  8,181
  8,781
  9,406
  10,055
  10,729
  11,431
  12,160
  12,920
  13,711
  14,535
  15,393
  16,289
  17,223
  18,198
  19,217
  20,281
  21,392
  22,555
  23,771
Operating income, $m
  811
  1,029
  1,169
  1,318
  1,474
  1,638
  1,810
  1,989
  2,177
  2,371
  2,574
  2,882
  3,102
  3,329
  3,566
  3,812
  4,068
  4,334
  4,611
  4,899
  5,198
  5,511
  5,836
  6,176
  6,530
  6,900
  7,286
  7,689
  8,111
  8,552
  9,013
EBITDA, $m
  1,523
  1,751
  1,969
  2,200
  2,443
  2,699
  2,966
  3,245
  3,536
  3,839
  4,155
  4,482
  4,823
  5,178
  5,546
  5,928
  6,326
  6,740
  7,170
  7,618
  8,084
  8,570
  9,076
  9,604
  10,155
  10,730
  11,330
  11,958
  12,613
  13,299
  14,016
Interest expense (income), $m
  226
  208
  258
  310
  366
  424
  486
  550
  617
  687
  759
  835
  914
  996
  1,081
  1,169
  1,261
  1,357
  1,456
  1,560
  1,667
  1,779
  1,896
  2,018
  2,144
  2,277
  2,415
  2,559
  2,710
  2,867
  3,032
Earnings before tax, $m
  464
  821
  911
  1,007
  1,108
  1,214
  1,324
  1,440
  1,560
  1,685
  1,815
  2,047
  2,188
  2,334
  2,485
  2,643
  2,807
  2,977
  3,154
  3,339
  3,531
  3,732
  3,940
  4,158
  4,386
  4,623
  4,871
  5,130
  5,401
  5,684
  5,981
Tax expense, $m
  126
  222
  246
  272
  299
  328
  358
  389
  421
  455
  490
  553
  591
  630
  671
  714
  758
  804
  852
  902
  953
  1,008
  1,064
  1,123
  1,184
  1,248
  1,315
  1,385
  1,458
  1,535
  1,615
Net income, $m
  903
  599
  665
  735
  809
  886
  967
  1,051
  1,139
  1,230
  1,325
  1,494
  1,597
  1,703
  1,814
  1,929
  2,049
  2,173
  2,303
  2,437
  2,578
  2,724
  2,877
  3,036
  3,202
  3,375
  3,556
  3,745
  3,943
  4,150
  4,366

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  300
  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
  11,385
  12,564
  14,130
  15,787
  17,532
  19,363
  21,280
  23,283
  25,371
  27,546
  29,809
  32,162
  34,608
  37,150
  39,791
  42,536
  45,390
  48,357
  51,445
  54,658
  58,004
  61,489
  65,122
  68,910
  72,863
  76,988
  81,296
  85,797
  90,501
  95,419
  100,563
Adjusted assets (=assets-cash), $m
  11,085
  12,564
  14,130
  15,787
  17,532
  19,363
  21,280
  23,283
  25,371
  27,546
  29,809
  32,162
  34,608
  37,150
  39,791
  42,536
  45,390
  48,357
  51,445
  54,658
  58,004
  61,489
  65,122
  68,910
  72,863
  76,988
  81,296
  85,797
  90,501
  95,419
  100,563
Revenue / Adjusted assets
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
  0.326
Average production assets, $m
  5,518
  6,250
  7,030
  7,854
  8,722
  9,633
  10,586
  11,583
  12,622
  13,704
  14,829
  16,000
  17,217
  18,481
  19,795
  21,161
  22,580
  24,057
  25,593
  27,191
  28,855
  30,589
  32,397
  34,281
  36,247
  38,300
  40,443
  42,682
  45,022
  47,469
  50,028
Working capital, $m
  -698
  -410
  -461
  -515
  -572
  -631
  -694
  -759
  -827
  -898
  -972
  -1,048
  -1,128
  -1,211
  -1,297
  -1,387
  -1,480
  -1,576
  -1,677
  -1,782
  -1,891
  -2,005
  -2,123
  -2,246
  -2,375
  -2,510
  -2,650
  -2,797
  -2,950
  -3,111
  -3,278
Total debt, $m
  4,154
  4,776
  5,747
  6,774
  7,856
  8,991
  10,180
  11,421
  12,716
  14,065
  15,468
  16,927
  18,443
  20,019
  21,656
  23,358
  25,128
  26,968
  28,882
  30,874
  32,948
  35,109
  37,362
  39,710
  42,161
  44,719
  47,390
  50,180
  53,097
  56,146
  59,335
Total liabilities, $m
  7,168
  7,790
  8,761
  9,788
  10,870
  12,005
  13,194
  14,435
  15,730
  17,079
  18,482
  19,941
  21,457
  23,033
  24,670
  26,372
  28,142
  29,982
  31,896
  33,888
  35,962
  38,123
  40,376
  42,724
  45,175
  47,733
  50,404
  53,194
  56,111
  59,160
  62,349
Total equity, $m
  4,217
  4,774
  5,370
  5,999
  6,662
  7,358
  8,086
  8,847
  9,641
  10,468
  11,327
  12,222
  13,151
  14,117
  15,121
  16,164
  17,248
  18,376
  19,549
  20,770
  22,041
  23,366
  24,746
  26,186
  27,688
  29,256
  30,893
  32,603
  34,390
  36,259
  38,214
Total liabilities and equity, $m
  11,385
  12,564
  14,131
  15,787
  17,532
  19,363
  21,280
  23,282
  25,371
  27,547
  29,809
  32,163
  34,608
  37,150
  39,791
  42,536
  45,390
  48,358
  51,445
  54,658
  58,003
  61,489
  65,122
  68,910
  72,863
  76,989
  81,297
  85,797
  90,501
  95,419
  100,563
Debt-to-equity ratio
  0.985
  1.000
  1.070
  1.130
  1.180
  1.220
  1.260
  1.290
  1.320
  1.340
  1.370
  1.380
  1.400
  1.420
  1.430
  1.450
  1.460
  1.470
  1.480
  1.490
  1.490
  1.500
  1.510
  1.520
  1.520
  1.530
  1.530
  1.540
  1.540
  1.550
  1.550
Adjusted equity ratio
  0.353
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380
  0.380

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  903
  599
  665
  735
  809
  886
  967
  1,051
  1,139
  1,230
  1,325
  1,494
  1,597
  1,703
  1,814
  1,929
  2,049
  2,173
  2,303
  2,437
  2,578
  2,724
  2,877
  3,036
  3,202
  3,375
  3,556
  3,745
  3,943
  4,150
  4,366
Depreciation, amort., depletion, $m
  712
  722
  800
  883
  969
  1,061
  1,156
  1,256
  1,359
  1,468
  1,580
  1,600
  1,722
  1,848
  1,980
  2,116
  2,258
  2,406
  2,559
  2,719
  2,886
  3,059
  3,240
  3,428
  3,625
  3,830
  4,044
  4,268
  4,502
  4,747
  5,003
Funds from operations, $m
  1,284
  1,321
  1,465
  1,618
  1,778
  1,947
  2,123
  2,307
  2,498
  2,698
  2,905
  3,094
  3,319
  3,552
  3,794
  4,045
  4,307
  4,579
  4,862
  5,157
  5,463
  5,783
  6,116
  6,464
  6,826
  7,205
  7,600
  8,013
  8,445
  8,897
  9,369
Change in working capital, $m
  53
  -48
  -51
  -54
  -57
  -60
  -62
  -65
  -68
  -71
  -74
  -77
  -80
  -83
  -86
  -89
  -93
  -97
  -101
  -105
  -109
  -114
  -118
  -124
  -129
  -134
  -140
  -147
  -153
  -160
  -168
Cash from operations, $m
  1,231
  1,369
  1,517
  1,672
  1,835
  2,006
  2,185
  2,372
  2,566
  2,768
  2,979
  3,171
  3,398
  3,634
  3,880
  4,135
  4,400
  4,676
  4,963
  5,261
  5,572
  5,897
  6,235
  6,587
  6,955
  7,339
  7,741
  8,160
  8,598
  9,057
  9,537
Maintenance CAPEX, $m
  0
  -552
  -625
  -703
  -785
  -872
  -963
  -1,059
  -1,158
  -1,262
  -1,370
  -1,483
  -1,600
  -1,722
  -1,848
  -1,980
  -2,116
  -2,258
  -2,406
  -2,559
  -2,719
  -2,886
  -3,059
  -3,240
  -3,428
  -3,625
  -3,830
  -4,044
  -4,268
  -4,502
  -4,747
New CAPEX, $m
  -887
  -733
  -779
  -824
  -868
  -911
  -954
  -996
  -1,039
  -1,082
  -1,126
  -1,171
  -1,217
  -1,264
  -1,314
  -1,366
  -1,420
  -1,476
  -1,536
  -1,598
  -1,664
  -1,734
  -1,807
  -1,885
  -1,966
  -2,052
  -2,143
  -2,239
  -2,340
  -2,447
  -2,559
Cash from investing activities, $m
  -908
  -1,285
  -1,404
  -1,527
  -1,653
  -1,783
  -1,917
  -2,055
  -2,197
  -2,344
  -2,496
  -2,654
  -2,817
  -2,986
  -3,162
  -3,346
  -3,536
  -3,734
  -3,942
  -4,157
  -4,383
  -4,620
  -4,866
  -5,125
  -5,394
  -5,677
  -5,973
  -6,283
  -6,608
  -6,949
  -7,306
Free cash flow, $m
  323
  85
  112
  145
  182
  223
  268
  317
  369
  424
  483
  518
  582
  648
  718
  790
  864
  941
  1,021
  1,104
  1,189
  1,277
  1,368
  1,463
  1,561
  1,662
  1,768
  1,877
  1,990
  2,108
  2,231
Issuance/(repayment) of debt, $m
  -38
  922
  971
  1,027
  1,082
  1,135
  1,189
  1,242
  1,295
  1,349
  1,403
  1,459
  1,516
  1,576
  1,638
  1,702
  1,769
  1,840
  1,914
  1,992
  2,074
  2,161
  2,252
  2,349
  2,451
  2,558
  2,671
  2,790
  2,916
  3,049
  3,189
Issuance/(repurchase) of shares, $m
  28
  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 financing (excl. dividends), $m  
  -27
  922
  971
  1,027
  1,082
  1,135
  1,189
  1,242
  1,295
  1,349
  1,403
  1,459
  1,516
  1,576
  1,638
  1,702
  1,769
  1,840
  1,914
  1,992
  2,074
  2,161
  2,252
  2,349
  2,451
  2,558
  2,671
  2,790
  2,916
  3,049
  3,189
Total cash flow (excl. dividends), $m
  296
  1,007
  1,083
  1,172
  1,264
  1,359
  1,457
  1,559
  1,664
  1,773
  1,886
  1,977
  2,098
  2,224
  2,355
  2,492
  2,633
  2,781
  2,935
  3,096
  3,263
  3,438
  3,621
  3,812
  4,011
  4,220
  4,439
  4,667
  4,907
  5,157
  5,420
Retained Cash Flow (-), $m
  -655
  -557
  -595
  -629
  -663
  -696
  -729
  -761
  -794
  -827
  -860
  -894
  -929
  -966
  -1,004
  -1,043
  -1,084
  -1,128
  -1,173
  -1,221
  -1,271
  -1,324
  -1,380
  -1,440
  -1,502
  -1,568
  -1,637
  -1,710
  -1,788
  -1,869
  -1,955
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
 
  449
  488
  542
  601
  663
  728
  798
  870
  946
  1,026
  1,082
  1,169
  1,258
  1,352
  1,448
  1,549
  1,654
  1,762
  1,875
  1,992
  2,114
  2,240
  2,372
  2,509
  2,652
  2,801
  2,957
  3,119
  3,288
  3,465
Discount rate, %
 
  6.90
  7.25
  7.61
  7.99
  8.39
  8.81
  9.25
  9.71
  10.19
  10.70
  11.24
  11.80
  12.39
  13.01
  13.66
  14.34
  15.06
  15.81
  16.61
  17.44
  18.31
  19.22
  20.18
  21.19
  22.25
  23.37
  24.53
  25.76
  27.05
  28.40
PV of cash for distribution, $m
 
  420
  424
  435
  442
  443
  439
  429
  415
  395
  371
  335
  306
  276
  244
  212
  181
  152
  125
  101
  80
  62
  47
  35
  25
  17
  12
  8
  5
  3
  2
Current shareholders' claim on cash, %
  100
  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
  100.0

Shaw Communications Inc. operates as a diversified communications company in Canada and the United States. The company operates through Consumer, Business Network Services, Business Infrastructure Services, and Wireless segments. The Consumer segment provides cable telecommunications services, including video, Internet, WiFi and phone, and satellite video services. The Business Network Services segment provides data networking, video, voice, and Internet services through a national fiber-optic backbone network; and satellite video and fleet tracking services. The Business Infrastructure Services segment provides data center colocation, cloud, and managed services. The Wireless segment provides wireless voice and data communications services. The company was formerly known as Shaw Cable systems Ltd. and changed its name to Shaw Communications Inc. in May 1993. Shaw Communications Inc. was founded in 1966 and is based in Calgary, Canada.

FINANCIAL RATIOS  of  Shaw Communications Cl B NV (SJR)

Valuation Ratios
P/E Ratio 11.9
Price to Sales 3
Price to Book 2.5
Price to Tangible Book
Price to Cash Flow 8.7
Price to Free Cash Flow 31.2
Growth Rates
Sales Growth Rate 8.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 12%
Cap. Spend. - 3 Yr. Gr. Rate 3.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 91.3%
Total Debt to Equity 98.5%
Interest Coverage 3
Management Effectiveness
Return On Assets 9.6%
Ret/ On Assets - 3 Yr. Avg. 8.5%
Return On Total Capital 11.2%
Ret/ On T. Cap. - 3 Yr. Avg. 9.7%
Return On Equity 23.2%
Return On Equity - 3 Yr. Avg. 20.2%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 43.3%
Gross Margin - 3 Yr. Avg. 44%
EBITDA Margin 38.8%
EBITDA Margin - 3 Yr. Avg. 42.3%
Operating Margin 22.4%
Oper. Margin - 3 Yr. Avg. 24.9%
Pre-Tax Margin 12.8%
Pre-Tax Margin - 3 Yr. Avg. 18.4%
Net Profit Margin 25%
Net Profit Margin - 3 Yr. Avg. 20.1%
Effective Tax Rate 27.2%
Eff/ Tax Rate - 3 Yr. Avg. 25.8%
Payout Ratio 32.2%

SJR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SJR stock intrinsic value calculation we used $3615 million for the last fiscal year's total revenue generated by Shaw Communications Cl B NV. The default revenue input number comes from 2016 income statement of Shaw Communications Cl B NV. 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 SJR stock valuation model: a) initial revenue growth rate of 13.3% 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 6.9%, whose default value for SJR is calculated based on our internal credit rating of Shaw Communications Cl B NV, 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 Shaw Communications Cl B NV.
    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 SJR stock the variable cost ratio is equal to 75.2%.

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 SJR 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 5.4% for Shaw Communications Cl B NV.

Corporate tax rate of 27% is the nominal tax rate for Shaw Communications Cl B NV. 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 SJR 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 SJR are equal to 152.6%.

Life of production assets of 10 years is the average useful life of capital assets used in Shaw Communications Cl B NV 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 SJR is equal to -10%. 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 - $4217 million for Shaw Communications Cl B NV - 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 485.273 million for Shaw Communications Cl B NV 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 Shaw Communications Cl B NV at the current share price and the inputted number of shares is $10.7 billion.

RELATED COMPANIES Price Int.Val. Rating
BCE BCE 47.03 26.60  sell
RCI Rogers Communi 51.41 21.14  str.sell
TU TELUS 35.55 13.00  str.sell

COMPANY NEWS

▶ Top 5 Monthly Dividend Stocks as of July 2017   [Jul-12-17 04:38PM  Investopedia]
▶ Stock Market News for June 29, 2017   [Jun-29-17 10:08AM  Zacks]
▶ Shaw beats 3Q profit forecasts   [Jun-28-17 09:54PM  Associated Press]
▶ Shaw Declares Monthly Dividends   [01:45PM  Marketwired]
▶ Story Stocks from Briefing.com   [11:32AM  Briefing.com]
▶ [$$] The Add-On Deal Roundup: June 2   [Jun-02-17 11:08AM  The Wall Street Journal]
▶ Shaw Communications Third Quarter 2017 Conference Call   [May-23-17 05:00PM  Marketwired]
▶ Shaw posts 2Q profit   [07:24AM  Associated Press]
▶ Shaw Declares Monthly Dividends   [07:05AM  Marketwired]
▶ Webcast-Q2 Earnings Call for Shaw Communications, Inc.   [Mar-17-17 12:14AM  at Company Spotlight]
▶ Shaw Communications Second Quarter 2017 Conference Call   [Mar-16-17 05:06PM  Marketwired]
▶ 3 Dividend Stocks That Pay You Every Month   [03:23PM  at Motley Fool]
▶ Top 5 Monthly Dividend Stocks for 2017   [11:22AM  at Investopedia]
Stock chart of SJR Financial statements of SJR
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.