Intrinsic value of Intrawest Resorts Holdings - SNOW

Previous Close

$23.75

  Intrinsic Value

$5.77

stock screener

  Rating & Target

str. sell

-76%

  Value-price divergence*

-205%

Previous close

$23.75

 
Intrinsic value

$5.77

 
Up/down potential

-76%

 
Rating

str. sell

 
Value-price divergence*

-205%

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

We calculate the intrinsic value of SNOW 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 1.0

 

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, %
  -2.89
  6.00
  5.90
  5.81
  5.73
  5.66
  5.59
  5.53
  5.48
  5.43
  5.39
  5.35
  5.31
  5.28
  5.25
  5.23
  5.21
  5.19
  5.17
  5.15
  5.14
  5.12
  5.11
  5.10
  5.09
  5.08
  5.07
  5.06
  5.06
  5.05
  5.05
Revenue, $m
  571
  605
  641
  678
  717
  758
  800
  844
  890
  939
  989
  1,042
  1,098
  1,156
  1,216
  1,280
  1,347
  1,417
  1,490
  1,566
  1,647
  1,731
  1,820
  1,912
  2,010
  2,112
  2,219
  2,331
  2,449
  2,573
  2,703
Variable operating expenses, $m
 
  568
  601
  635
  671
  708
  747
  788
  830
  875
  921
  959
  1,010
  1,064
  1,120
  1,178
  1,240
  1,304
  1,371
  1,442
  1,516
  1,593
  1,675
  1,760
  1,850
  1,944
  2,042
  2,146
  2,254
  2,368
  2,488
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
  492
  568
  601
  635
  671
  708
  747
  788
  830
  875
  921
  959
  1,010
  1,064
  1,120
  1,178
  1,240
  1,304
  1,371
  1,442
  1,516
  1,593
  1,675
  1,760
  1,850
  1,944
  2,042
  2,146
  2,254
  2,368
  2,488
Operating income, $m
  79
  38
  40
  43
  46
  50
  53
  57
  60
  64
  68
  83
  87
  92
  97
  102
  107
  113
  119
  125
  131
  138
  145
  152
  160
  168
  177
  185
  195
  205
  215
EBITDA, $m
  139
  104
  110
  116
  123
  130
  137
  145
  152
  161
  169
  178
  188
  198
  208
  219
  231
  242
  255
  268
  282
  296
  311
  327
  344
  362
  380
  399
  419
  440
  463
Interest expense (income), $m
  31
  30
  32
  35
  37
  40
  43
  46
  49
  52
  56
  59
  63
  67
  71
  76
  80
  85
  90
  95
  100
  106
  112
  118
  125
  132
  139
  147
  155
  163
  172
Earnings before tax, $m
  45
  8
  8
  9
  9
  10
  10
  11
  11
  12
  12
  23
  24
  25
  26
  26
  27
  28
  29
  30
  31
  32
  33
  34
  35
  36
  37
  39
  40
  42
  43
Tax expense, $m
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  6
  7
  7
  7
  7
  7
  8
  8
  8
  8
  9
  9
  9
  9
  10
  10
  10
  11
  11
  12
Net income, $m
  41
  6
  6
  6
  7
  7
  7
  8
  8
  9
  9
  17
  18
  18
  19
  19
  20
  20
  21
  22
  22
  23
  24
  25
  26
  26
  27
  28
  29
  30
  32

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  107
  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
  1,038
  987
  1,046
  1,106
  1,170
  1,236
  1,305
  1,377
  1,453
  1,532
  1,614
  1,700
  1,791
  1,885
  1,984
  2,088
  2,197
  2,311
  2,430
  2,555
  2,687
  2,824
  2,968
  3,120
  3,279
  3,445
  3,620
  3,803
  3,995
  4,197
  4,409
Adjusted assets (=assets-cash), $m
  931
  987
  1,046
  1,106
  1,170
  1,236
  1,305
  1,377
  1,453
  1,532
  1,614
  1,700
  1,791
  1,885
  1,984
  2,088
  2,197
  2,311
  2,430
  2,555
  2,687
  2,824
  2,968
  3,120
  3,279
  3,445
  3,620
  3,803
  3,995
  4,197
  4,409
Revenue / Adjusted assets
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
Average production assets, $m
  712
  754
  799
  845
  893
  944
  997
  1,052
  1,110
  1,170
  1,233
  1,299
  1,368
  1,440
  1,516
  1,595
  1,678
  1,765
  1,856
  1,952
  2,052
  2,157
  2,267
  2,383
  2,504
  2,631
  2,765
  2,905
  3,052
  3,206
  3,368
Working capital, $m
  64
  -41
  -44
  -46
  -49
  -52
  -54
  -57
  -61
  -64
  -67
  -71
  -75
  -79
  -83
  -87
  -92
  -96
  -101
  -107
  -112
  -118
  -124
  -130
  -137
  -144
  -151
  -159
  -167
  -175
  -184
Total debt, $m
  576
  619
  668
  719
  772
  827
  885
  945
  1,008
  1,074
  1,143
  1,216
  1,291
  1,370
  1,453
  1,540
  1,631
  1,726
  1,826
  1,930
  2,040
  2,155
  2,276
  2,402
  2,535
  2,674
  2,820
  2,973
  3,134
  3,303
  3,480
Total liabilities, $m
  781
  825
  874
  925
  978
  1,033
  1,091
  1,151
  1,214
  1,280
  1,349
  1,422
  1,497
  1,576
  1,659
  1,746
  1,837
  1,932
  2,032
  2,136
  2,246
  2,361
  2,482
  2,608
  2,741
  2,880
  3,026
  3,179
  3,340
  3,509
  3,686
Total equity, $m
  256
  162
  171
  181
  192
  203
  214
  226
  238
  251
  265
  279
  294
  309
  325
  342
  360
  379
  399
  419
  441
  463
  487
  512
  538
  565
  594
  624
  655
  688
  723
Total liabilities and equity, $m
  1,037
  987
  1,045
  1,106
  1,170
  1,236
  1,305
  1,377
  1,452
  1,531
  1,614
  1,701
  1,791
  1,885
  1,984
  2,088
  2,197
  2,311
  2,431
  2,555
  2,687
  2,824
  2,969
  3,120
  3,279
  3,445
  3,620
  3,803
  3,995
  4,197
  4,409
Debt-to-equity ratio
  2.250
  3.830
  3.900
  3.960
  4.020
  4.080
  4.140
  4.190
  4.230
  4.280
  4.320
  4.360
  4.400
  4.430
  4.460
  4.500
  4.530
  4.550
  4.580
  4.610
  4.630
  4.650
  4.670
  4.690
  4.710
  4.730
  4.750
  4.770
  4.780
  4.800
  4.810
Adjusted equity ratio
  0.160
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  41
  6
  6
  6
  7
  7
  7
  8
  8
  9
  9
  17
  18
  18
  19
  19
  20
  20
  21
  22
  22
  23
  24
  25
  26
  26
  27
  28
  29
  30
  32
Depreciation, amort., depletion, $m
  60
  66
  69
  73
  76
  80
  84
  88
  92
  97
  101
  95
  101
  106
  111
  117
  123
  130
  136
  144
  151
  159
  167
  175
  184
  193
  203
  214
  224
  236
  248
Funds from operations, $m
  71
  72
  75
  79
  83
  87
  91
  96
  100
  105
  110
  113
  118
  124
  130
  136
  143
  150
  157
  165
  173
  182
  191
  200
  210
  220
  231
  242
  254
  266
  279
Change in working capital, $m
  6
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -8
  -9
Cash from operations, $m
  65
  74
  78
  82
  86
  90
  94
  99
  103
  108
  114
  116
  122
  128
  134
  141
  148
  155
  162
  170
  179
  187
  197
  206
  216
  227
  238
  250
  262
  275
  288
Maintenance CAPEX, $m
  0
  -52
  -55
  -59
  -62
  -66
  -69
  -73
  -77
  -82
  -86
  -91
  -95
  -101
  -106
  -111
  -117
  -123
  -130
  -136
  -144
  -151
  -159
  -167
  -175
  -184
  -193
  -203
  -214
  -224
  -236
New CAPEX, $m
  -51
  -43
  -44
  -46
  -48
  -51
  -53
  -55
  -58
  -60
  -63
  -66
  -69
  -72
  -76
  -79
  -83
  -87
  -91
  -96
  -100
  -105
  -110
  -116
  -121
  -127
  -133
  -140
  -147
  -154
  -162
Cash from investing activities, $m
  39
  -95
  -99
  -105
  -110
  -117
  -122
  -128
  -135
  -142
  -149
  -157
  -164
  -173
  -182
  -190
  -200
  -210
  -221
  -232
  -244
  -256
  -269
  -283
  -296
  -311
  -326
  -343
  -361
  -378
  -398
Free cash flow, $m
  104
  -21
  -22
  -24
  -25
  -26
  -28
  -30
  -32
  -33
  -35
  -40
  -43
  -45
  -47
  -50
  -53
  -55
  -58
  -62
  -65
  -69
  -72
  -76
  -80
  -84
  -89
  -94
  -99
  -104
  -109
Issuance/(repayment) of debt, $m
  -42
  47
  49
  51
  53
  55
  58
  60
  63
  66
  69
  72
  76
  79
  83
  87
  91
  95
  100
  105
  110
  115
  121
  127
  133
  139
  146
  153
  161
  169
  177
Issuance/(repurchase) of shares, $m
  -51
  3
  4
  4
  4
  4
  4
  4
  4
  4
  5
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  2
  2
  3
  3
Cash from financing (excl. dividends), $m  
  -95
  50
  53
  55
  57
  59
  62
  64
  67
  70
  74
  72
  76
  79
  83
  87
  91
  95
  100
  105
  110
  115
  121
  127
  133
  140
  147
  155
  163
  172
  180
Total cash flow (excl. dividends), $m
  16
  30
  30
  31
  32
  33
  34
  35
  36
  37
  38
  32
  33
  34
  35
  37
  38
  40
  41
  43
  45
  47
  48
  51
  53
  56
  58
  61
  64
  67
  71
Retained Cash Flow (-), $m
  20
  -9
  -10
  -10
  -10
  -11
  -11
  -12
  -12
  -13
  -14
  -14
  -15
  -16
  -16
  -17
  -18
  -19
  -20
  -21
  -22
  -23
  -24
  -25
  -26
  -27
  -29
  -30
  -32
  -33
  -35
Prev. year cash balance distribution, $m
 
  103
  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
 
  124
  21
  21
  21
  22
  22
  23
  23
  24
  25
  18
  18
  19
  19
  20
  20
  21
  22
  22
  23
  24
  25
  26
  27
  28
  30
  31
  33
  34
  36
Discount rate, %
 
  9.20
  9.66
  10.14
  10.65
  11.18
  11.74
  12.33
  12.95
  13.59
  14.27
  14.99
  15.74
  16.52
  17.35
  18.22
  19.13
  20.08
  21.09
  22.14
  23.25
  24.41
  25.63
  26.91
  28.26
  29.67
  31.15
  32.71
  34.35
  36.07
  37.87
PV of cash for distribution, $m
 
  113
  17
  16
  14
  13
  11
  10
  9
  8
  6
  4
  3
  3
  2
  2
  1
  1
  1
  1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  99.4
  98.8
  98.3
  97.7
  97.2
  96.7
  96.2
  95.7
  95.2
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.8
  94.7
  94.7
  94.6
  94.6
  94.5
  94.4
  94.2

Intrawest Resorts Holdings, Inc. operates as a mountain resort, adventure, and real estate company in North America. The company operates through three segments: Mountain, Adventure, and Real Estate. The Mountain segment engages in mountain resort and lodging operations at Steamboat Ski & Resort and Winter Park Resort located in Colorado; Stratton Mountain Resort located in Vermont; Snowshoe Mountain Resort located in West Virginia; Mont Tremblant Resort located in Quebec; and Blue Mountain Ski Resort located in Ontario. This segment provides lift pass, lodging, ski school, merchandise retail and rental, food and beverage, and other ancillary services. The Adventure segment offers helicopter accessed skiing, mountaineering, and hiking services at owned and leased lodges over approximately 3.0 million tenured acres located in the Purcell, Selkirk, Monashee, and Cariboo mountains of eastern British Columbia. It operates through a fleet of 36 Bell helicopters. This segment also provides commercial aviation services, such as firefighting and leasing, as well as helicopter maintenance, repair, and overhaul services. The Real Estate segment manages condominium hotel properties; markets and sells residential real estate properties; and develops approximately 1,120 acres of land. The company is headquartered in Denver, Colorado. Intrawest Resorts Holdings, Inc. is a subsidiary of Intrawest Europe Holdings S.àr.l.

FINANCIAL RATIOS  of  Intrawest Resorts Holdings (SNOW)

Valuation Ratios
P/E Ratio 23
Price to Sales 1.7
Price to Book 3.7
Price to Tangible Book
Price to Cash Flow 14.5
Price to Free Cash Flow 67.4
Growth Rates
Sales Growth Rate -2.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 21.4%
Cap. Spend. - 3 Yr. Gr. Rate 10.5%
Financial Strength
Quick Ratio 27
Current Ratio 0.2
LT Debt to Equity 223.4%
Total Debt to Equity 225%
Interest Coverage 2
Management Effectiveness
Return On Assets 6.6%
Ret/ On Assets - 3 Yr. Avg. -1.8%
Return On Total Capital 4.8%
Ret/ On T. Cap. - 3 Yr. Avg. -5.6%
Return On Equity 15.4%
Return On Equity - 3 Yr. Avg. 22.7%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 23.8%
EBITDA Margin - 3 Yr. Avg. 6.9%
Operating Margin 13.8%
Oper. Margin - 3 Yr. Avg. 5.4%
Pre-Tax Margin 7.9%
Pre-Tax Margin - 3 Yr. Avg. -9.8%
Net Profit Margin 7.2%
Net Profit Margin - 3 Yr. Avg. -10%
Effective Tax Rate 4.4%
Eff/ Tax Rate - 3 Yr. Avg. 16.1%
Payout Ratio 0%

SNOW stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SNOW stock intrinsic value calculation we used $571 million for the last fiscal year's total revenue generated by Intrawest Resorts Holdings. The default revenue input number comes from 2016 income statement of Intrawest Resorts Holdings. 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 SNOW stock valuation model: a) initial revenue growth rate of 6% 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 9.2%, whose default value for SNOW is calculated based on our internal credit rating of Intrawest Resorts Holdings, 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 Intrawest Resorts Holdings.
    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 SNOW stock the variable cost ratio is equal to 93.9%.

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 SNOW 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 5.2% for Intrawest Resorts Holdings.

Corporate tax rate of 27% is the nominal tax rate for Intrawest Resorts Holdings. 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 SNOW 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 SNOW are equal to 124.6%.

Life of production assets of 13.6 years is the average useful life of capital assets used in Intrawest Resorts Holdings 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 SNOW is equal to -6.8%. 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 - $256 million for Intrawest Resorts Holdings - 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 40.031 million for Intrawest Resorts Holdings 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 Intrawest Resorts Holdings at the current share price and the inputted number of shares is $1.0 billion.

RELATED COMPANIES Price Int.Val. Rating
MTN Vail Resorts 220.21 289.76  buy
SKIS Peak Resorts 4.85 76.94  str.buy
AIG American Inter 61.34 176.34  str.buy
MCS Marcus 24.50 3.25  str.sell
MAR Marriott Inter 98.03 530.50  str.buy
WYN Wyndham Worldw 96.72 58.46  sell
HLT Hilton Worldwi 61.06 166.52  str.buy
Stock chart of SNOW Financial statements of SNOW
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.