Intrinsic value of Stamps.com - STMP

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$103.75

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$103.75

 
Intrinsic value

$2,635

 
Up/down potential

+999%

 
Rating

str. buy

 
Value-price divergence* premium content

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

We calculate the intrinsic value of STMP 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 1.8

 

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, %
  70.09
  51.40
  46.76
  42.58
  38.83
  35.44
  32.40
  29.66
  27.19
  24.97
  22.98
  21.18
  19.56
  18.10
  16.79
  15.61
  14.55
  13.60
  12.74
  11.96
  11.27
  10.64
  10.08
  9.57
  9.11
  8.70
  8.33
  8.00
  7.70
  7.43
  7.19
Revenue, $m
  364
  551
  809
  1,153
  1,601
  2,168
  2,871
  3,722
  4,735
  5,917
  7,276
  8,818
  10,542
  12,451
  14,542
  16,813
  19,260
  21,878
  24,665
  27,616
  30,728
  33,998
  37,424
  41,005
  44,742
  48,635
  52,687
  56,901
  61,281
  65,833
  70,564
Variable operating expenses, $m
 
  101
  137
  186
  248
  328
  426
  545
  687
  853
  1,043
  1,235
  1,477
  1,744
  2,037
  2,355
  2,698
  3,064
  3,455
  3,868
  4,304
  4,762
  5,242
  5,743
  6,267
  6,812
  7,380
  7,970
  8,583
  9,221
  9,884
Fixed operating expenses, $m
 
  183
  188
  193
  198
  203
  208
  213
  218
  224
  229
  235
  241
  247
  253
  259
  266
  272
  279
  286
  293
  301
  308
  316
  324
  332
  340
  349
  357
  366
  375
Total operating expenses, $m
  244
  284
  325
  379
  446
  531
  634
  758
  905
  1,077
  1,272
  1,470
  1,718
  1,991
  2,290
  2,614
  2,964
  3,336
  3,734
  4,154
  4,597
  5,063
  5,550
  6,059
  6,591
  7,144
  7,720
  8,319
  8,940
  9,587
  10,259
Operating income, $m
  120
  266
  483
  775
  1,155
  1,638
  2,237
  2,964
  3,829
  4,841
  6,004
  7,348
  8,825
  10,460
  12,252
  14,199
  16,296
  18,542
  20,931
  23,462
  26,131
  28,936
  31,874
  34,946
  38,151
  41,491
  44,967
  48,582
  52,340
  56,246
  60,305
EBITDA, $m
  139
  301
  523
  821
  1,210
  1,705
  2,317
  3,061
  3,946
  4,980
  6,171
  7,520
  9,031
  10,704
  12,537
  14,528
  16,673
  18,970
  21,414
  24,003
  26,732
  29,601
  32,606
  35,748
  39,027
  42,443
  45,998
  49,695
  53,539
  57,534
  61,685
Interest expense (income), $m
  3
  5
  9
  15
  22
  32
  45
  61
  80
  102
  128
  158
  193
  231
  273
  320
  370
  425
  483
  545
  610
  679
  752
  828
  907
  990
  1,077
  1,167
  1,260
  1,358
  1,459
Earnings before tax, $m
  117
  261
  474
  760
  1,133
  1,606
  2,192
  2,904
  3,750
  4,739
  5,876
  7,189
  8,632
  10,229
  11,979
  13,879
  15,926
  18,117
  20,449
  22,918
  25,521
  28,256
  31,122
  34,118
  37,244
  40,501
  43,890
  47,415
  51,080
  54,888
  58,846
Tax expense, $m
  42
  71
  128
  205
  306
  434
  592
  784
  1,012
  1,279
  1,586
  1,941
  2,331
  2,762
  3,234
  3,747
  4,300
  4,892
  5,521
  6,188
  6,891
  7,629
  8,403
  9,212
  10,056
  10,935
  11,850
  12,802
  13,792
  14,820
  15,888
Net income, $m
  75
  191
  346
  555
  827
  1,172
  1,600
  2,120
  2,737
  3,459
  4,289
  5,248
  6,302
  7,467
  8,745
  10,132
  11,626
  13,226
  14,928
  16,730
  18,630
  20,627
  22,719
  24,906
  27,188
  29,565
  32,040
  34,613
  37,288
  40,068
  42,957

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  108
  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
  610
  760
  1,116
  1,591
  2,208
  2,991
  3,960
  5,134
  6,530
  8,161
  10,037
  12,162
  14,541
  17,174
  20,058
  23,190
  26,565
  30,177
  34,021
  38,092
  42,384
  46,894
  51,619
  56,559
  61,713
  67,083
  72,671
  78,484
  84,525
  90,804
  97,329
Adjusted assets (=assets-cash), $m
  502
  760
  1,116
  1,591
  2,208
  2,991
  3,960
  5,134
  6,530
  8,161
  10,037
  12,162
  14,541
  17,174
  20,058
  23,190
  26,565
  30,177
  34,021
  38,092
  42,384
  46,894
  51,619
  56,559
  61,713
  67,083
  72,671
  78,484
  84,525
  90,804
  97,329
Revenue / Adjusted assets
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
  0.725
Average production assets, $m
  131
  198
  291
  415
  576
  781
  1,034
  1,340
  1,704
  2,130
  2,620
  3,174
  3,795
  4,482
  5,235
  6,053
  6,933
  7,876
  8,880
  9,942
  11,062
  12,239
  13,473
  14,762
  16,107
  17,509
  18,967
  20,484
  22,061
  23,700
  25,403
Working capital, $m
  88
  -21
  -31
  -44
  -61
  -82
  -109
  -141
  -180
  -225
  -277
  -335
  -401
  -473
  -553
  -639
  -732
  -831
  -937
  -1,049
  -1,168
  -1,292
  -1,422
  -1,558
  -1,700
  -1,848
  -2,002
  -2,162
  -2,329
  -2,502
  -2,681
Total debt, $m
  147
  260
  423
  642
  926
  1,286
  1,732
  2,272
  2,914
  3,664
  4,527
  5,505
  6,599
  7,810
  9,137
  10,577
  12,130
  13,792
  15,560
  17,432
  19,407
  21,481
  23,655
  25,927
  28,298
  30,768
  33,339
  36,013
  38,792
  41,680
  44,681
Total liabilities, $m
  237
  350
  513
  732
  1,016
  1,376
  1,822
  2,362
  3,004
  3,754
  4,617
  5,595
  6,689
  7,900
  9,227
  10,667
  12,220
  13,882
  15,650
  17,522
  19,497
  21,571
  23,745
  26,017
  28,388
  30,858
  33,429
  36,103
  38,882
  41,770
  44,771
Total equity, $m
  373
  410
  602
  859
  1,192
  1,615
  2,138
  2,773
  3,526
  4,407
  5,420
  6,568
  7,852
  9,274
  10,831
  12,523
  14,345
  16,296
  18,371
  20,570
  22,887
  25,323
  27,875
  30,542
  33,325
  36,225
  39,243
  42,381
  45,644
  49,034
  52,558
Total liabilities and equity, $m
  610
  760
  1,115
  1,591
  2,208
  2,991
  3,960
  5,135
  6,530
  8,161
  10,037
  12,163
  14,541
  17,174
  20,058
  23,190
  26,565
  30,178
  34,021
  38,092
  42,384
  46,894
  51,620
  56,559
  61,713
  67,083
  72,672
  78,484
  84,526
  90,804
  97,329
Debt-to-equity ratio
  0.394
  0.630
  0.700
  0.750
  0.780
  0.800
  0.810
  0.820
  0.830
  0.830
  0.840
  0.840
  0.840
  0.840
  0.840
  0.840
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
  0.850
Adjusted equity ratio
  0.528
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540
  0.540

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  75
  191
  346
  555
  827
  1,172
  1,600
  2,120
  2,737
  3,459
  4,289
  5,248
  6,302
  7,467
  8,745
  10,132
  11,626
  13,226
  14,928
  16,730
  18,630
  20,627
  22,719
  24,906
  27,188
  29,565
  32,040
  34,613
  37,288
  40,068
  42,957
Depreciation, amort., depletion, $m
  19
  35
  40
  47
  55
  66
  80
  97
  117
  140
  166
  173
  206
  244
  285
  329
  377
  428
  483
  540
  601
  665
  732
  802
  875
  952
  1,031
  1,113
  1,199
  1,288
  1,381
Funds from operations, $m
  160
  226
  386
  601
  882
  1,239
  1,680
  2,216
  2,854
  3,599
  4,456
  5,421
  6,508
  7,711
  9,029
  10,460
  12,003
  13,654
  15,410
  17,270
  19,231
  21,292
  23,451
  25,709
  28,063
  30,517
  33,071
  35,726
  38,487
  41,356
  44,338
Change in working capital, $m
  12
  -7
  -10
  -13
  -17
  -22
  -27
  -32
  -38
  -45
  -52
  -59
  -66
  -73
  -79
  -86
  -93
  -100
  -106
  -112
  -118
  -124
  -130
  -136
  -142
  -148
  -154
  -160
  -166
  -173
  -180
Cash from operations, $m
  148
  236
  396
  615
  899
  1,260
  1,707
  2,249
  2,892
  3,644
  4,507
  5,479
  6,573
  7,784
  9,109
  10,547
  12,096
  13,753
  15,516
  17,382
  19,350
  21,417
  23,582
  25,845
  28,205
  30,665
  33,225
  35,887
  38,654
  41,529
  44,518
Maintenance CAPEX, $m
  0
  -7
  -11
  -16
  -23
  -31
  -42
  -56
  -73
  -93
  -116
  -142
  -173
  -206
  -244
  -285
  -329
  -377
  -428
  -483
  -540
  -601
  -665
  -732
  -802
  -875
  -952
  -1,031
  -1,113
  -1,199
  -1,288
New CAPEX, $m
  -8
  -67
  -93
  -124
  -161
  -204
  -253
  -307
  -364
  -426
  -489
  -555
  -621
  -687
  -753
  -817
  -881
  -943
  -1,003
  -1,062
  -1,120
  -1,177
  -1,233
  -1,289
  -1,345
  -1,402
  -1,459
  -1,517
  -1,577
  -1,639
  -1,703
Cash from investing activities, $m
  -55
  -74
  -104
  -140
  -184
  -235
  -295
  -363
  -437
  -519
  -605
  -697
  -794
  -893
  -997
  -1,102
  -1,210
  -1,320
  -1,431
  -1,545
  -1,660
  -1,778
  -1,898
  -2,021
  -2,147
  -2,277
  -2,411
  -2,548
  -2,690
  -2,838
  -2,991
Free cash flow, $m
  93
  161
  292
  475
  715
  1,025
  1,412
  1,886
  2,455
  3,126
  3,902
  4,782
  5,780
  6,890
  8,112
  9,445
  10,886
  12,433
  14,085
  15,837
  17,689
  19,638
  21,683
  23,823
  26,058
  28,388
  30,814
  33,339
  35,963
  38,692
  41,527
Issuance/(repayment) of debt, $m
  -12
  119
  164
  219
  284
  360
  446
  540
  642
  750
  863
  978
  1,094
  1,211
  1,327
  1,441
  1,552
  1,662
  1,768
  1,872
  1,974
  2,075
  2,174
  2,272
  2,371
  2,470
  2,571
  2,674
  2,779
  2,888
  3,001
Issuance/(repurchase) of shares, $m
  -65
  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  
  -51
  119
  164
  219
  284
  360
  446
  540
  642
  750
  863
  978
  1,094
  1,211
  1,327
  1,441
  1,552
  1,662
  1,768
  1,872
  1,974
  2,075
  2,174
  2,272
  2,371
  2,470
  2,571
  2,674
  2,779
  2,888
  3,001
Total cash flow (excl. dividends), $m
  42
  280
  456
  693
  1,000
  1,385
  1,858
  2,426
  3,097
  3,876
  4,765
  5,760
  6,874
  8,101
  9,439
  10,886
  12,438
  14,095
  15,853
  17,710
  19,663
  21,713
  23,857
  26,095
  28,429
  30,858
  33,385
  36,012
  38,743
  41,580
  44,528
Retained Cash Flow (-), $m
  -134
  -139
  -192
  -257
  -333
  -423
  -523
  -634
  -754
  -881
  -1,013
  -1,148
  -1,285
  -1,422
  -1,557
  -1,691
  -1,822
  -1,951
  -2,076
  -2,198
  -2,318
  -2,435
  -2,552
  -2,667
  -2,783
  -2,900
  -3,018
  -3,139
  -3,263
  -3,391
  -3,523
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
 
  242
  264
  437
  666
  962
  1,334
  1,792
  2,344
  2,995
  3,752
  4,612
  5,590
  6,680
  7,881
  9,194
  10,616
  12,144
  13,777
  15,512
  17,346
  19,277
  21,305
  23,428
  25,646
  27,958
  30,367
  32,874
  35,480
  38,189
  41,005
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
 
  232
  242
  380
  548
  746
  968
  1,211
  1,465
  1,721
  1,967
  2,190
  2,385
  2,540
  2,646
  2,699
  2,698
  2,642
  2,537
  2,388
  2,204
  1,994
  1,768
  1,535
  1,306
  1,088
  886
  706
  549
  417
  309
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

Stamps.com Inc. provides Internet-based postage solutions in the United States. It offers solutions for mailing and shipping various mail pieces, such as postcards, envelopes, flats, and packages using a range of United States Postal Service (USPS) mail classes, including First Class Mail, Priority Mail, Priority Mail Express, Media Mail, Parcel Select, and others. The company’s products and services comprise USPS approved PC Postage service that enables users to print electronic stamps directly onto envelopes, plain paper, or labels using personal computer, printer, and Internet connection. It also provides multi carrier shipping solutions under the ShipStation and ShipWorks brands; mailing and shipping integration solutions comprising electronic postage for transactions to partners who manage the front-end process; sells NetStamps labels, DYMO Stamp labels, shipping labels, other mailing labels, dedicated postage printers, scales, and other mailing and shipping-focused office supplies through its mailing and shipping supplies store; and Stamps.com branded insurance to insure mails or packages. In addition, the company offers PhotoStamps, a patented form of postage service, which allows consumers to turn digital photos, designs, or images into USPS-approved postages. It serves individuals, small businesses, home offices, medium-size businesses, and large enterprises. The company was formerly known as StampMaster, Inc. and changed its name to Stamps.com Inc. in December 1998. Stamps.com Inc. was founded in 1996 and is headquartered in El Segundo, California.

FINANCIAL RATIOS  of  Stamps.com (STMP)

Valuation Ratios
P/E Ratio 23.4
Price to Sales 4.8
Price to Book 4.7
Price to Tangible Book
Price to Cash Flow 11.8
Price to Free Cash Flow 12.5
Growth Rates
Sales Growth Rate 70.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 300%
Cap. Spend. - 3 Yr. Gr. Rate 9.9%
Financial Strength
Quick Ratio 18
Current Ratio 0.1
LT Debt to Equity 37.8%
Total Debt to Equity 39.4%
Interest Coverage 40
Management Effectiveness
Return On Assets 13.5%
Ret/ On Assets - 3 Yr. Avg. 9.7%
Return On Total Capital 16.3%
Ret/ On T. Cap. - 3 Yr. Avg. 11.5%
Return On Equity 24.5%
Return On Equity - 3 Yr. Avg. 14.1%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 82.7%
Gross Margin - 3 Yr. Avg. 79.9%
EBITDA Margin 38.2%
EBITDA Margin - 3 Yr. Avg. 19.6%
Operating Margin 33%
Oper. Margin - 3 Yr. Avg. 15.7%
Pre-Tax Margin 32.1%
Pre-Tax Margin - 3 Yr. Avg. 15.2%
Net Profit Margin 20.6%
Net Profit Margin - 3 Yr. Avg. 14.6%
Effective Tax Rate 35.9%
Eff/ Tax Rate - 3 Yr. Avg. 5%
Payout Ratio 0%

STMP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the STMP stock intrinsic value calculation we used $364 million for the last fiscal year's total revenue generated by Stamps.com. The default revenue input number comes from 2016 income statement of Stamps.com. 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 STMP stock valuation model: a) initial revenue growth rate of 51.4% 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 STMP is calculated based on our internal credit rating of Stamps.com, 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 Stamps.com.
    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 STMP stock the variable cost ratio is equal to 20.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $179 million in the base year in the intrinsic value calculation for STMP 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 Stamps.com.

Corporate tax rate of 27% is the nominal tax rate for Stamps.com. 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 STMP 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 STMP are equal to 36%.

Life of production assets of 18.4 years is the average useful life of capital assets used in Stamps.com 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 STMP is equal to -3.8%. 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 - $373 million for Stamps.com - 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 17.322 million for Stamps.com 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 Stamps.com at the current share price and the inputted number of shares is $1.8 billion.


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COMPANY NEWS

▶ ETFs with exposure to Stamps.com, Inc. : April 20, 2017   [Apr-20-17 02:31PM  Capital Cube]
▶ ETFs with exposure to Stamps.com, Inc. : April 7, 2017   [Apr-07-17 05:32PM  Capital Cube]
▶ Stocks To Watch In Market Weakness   [01:49PM  Benzinga]
▶ ETFs with exposure to Stamps.com, Inc. : March 27, 2017   [Mar-27-17 04:07PM  Capital Cube]
▶ As Berkshire Buys Apple, Which Stocks Make 'Warren Buffett Screen'?   [Feb-27-17 04:23PM  Investor's Business Daily]
▶ Stamps.com Inc. Delivers 52% Revenue Growth   [Feb-25-17 05:26PM  Motley Fool]
▶ Stamps.com beats Street 4Q forecasts   [05:45PM  Associated Press]
▶ [$$] Facebook for Stockpickers   [Dec-24-16 12:01AM  at Barrons.com]
▶ 17 undervalued small-cap stocks to consider as markets rally   [Dec-02-16 10:58AM  at MarketWatch]
▶ Acquisitions Drive Stamps.com Inc. Earnings Sharply Higher   [Nov-08-16 04:17PM  at Motley Fool]
▶ Stamps.com tops Street 3Q forecasts   [Nov-03-16 05:27PM  AP]
Stock chart of STMP Financial statements of STMP
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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