Intrinsic value of Symantec - SYMC

Previous Close

$28.30

  Intrinsic Value

$36.31

stock screener

  Rating & Target

buy

+28%

  Value-price divergence*

-123%

Previous close

$28.30

 
Intrinsic value

$36.31

 
Up/down potential

+28%

 
Rating

buy

 
Value-price divergence*

-123%

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

We calculate the intrinsic value of SYMC 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 2017), $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 17.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2017(a)
   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
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  11.64
  11.60
  10.94
  10.35
  9.81
  9.33
  8.90
  8.51
  8.16
  7.84
  7.56
  7.30
  7.07
  6.86
  6.68
  6.51
  6.36
  6.22
  6.10
  5.99
  5.89
  5.80
  5.72
  5.65
  5.58
  5.53
  5.47
  5.43
  5.38
  5.35
  5.31
Revenue, $m
  4,019
  4,485
  4,976
  5,491
  6,029
  6,592
  7,178
  7,789
  8,425
  9,085
  9,772
  10,485
  11,227
  11,997
  12,798
  13,631
  14,498
  15,400
  16,340
  17,319
  18,339
  19,403
  20,514
  21,673
  22,883
  24,148
  25,469
  26,851
  28,297
  29,810
  31,393
Variable operating expenses, $m
 
  3,816
  4,139
  4,477
  4,832
  5,202
  5,589
  5,991
  6,409
  6,844
  7,296
  6,903
  7,391
  7,898
  8,426
  8,974
  9,545
  10,139
  10,757
  11,402
  12,073
  12,774
  13,505
  14,268
  15,065
  15,897
  16,768
  17,678
  18,629
  19,625
  20,667
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
  4,119
  3,816
  4,139
  4,477
  4,832
  5,202
  5,589
  5,991
  6,409
  6,844
  7,296
  6,903
  7,391
  7,898
  8,426
  8,974
  9,545
  10,139
  10,757
  11,402
  12,073
  12,774
  13,505
  14,268
  15,065
  15,897
  16,768
  17,678
  18,629
  19,625
  20,667
Operating income, $m
  -100
  670
  837
  1,013
  1,197
  1,389
  1,590
  1,799
  2,016
  2,241
  2,476
  3,582
  3,836
  4,099
  4,373
  4,657
  4,953
  5,262
  5,583
  5,917
  6,266
  6,629
  7,009
  7,405
  7,818
  8,250
  8,702
  9,174
  9,668
  10,185
  10,726
EBITDA, $m
  430
  1,717
  1,905
  2,102
  2,309
  2,524
  2,749
  2,982
  3,226
  3,479
  3,742
  4,015
  4,299
  4,594
  4,900
  5,219
  5,551
  5,897
  6,257
  6,631
  7,022
  7,429
  7,855
  8,298
  8,762
  9,246
  9,752
  10,281
  10,835
  11,414
  12,020
Interest expense (income), $m
  143
  241
  295
  352
  412
  475
  541
  609
  680
  754
  831
  911
  994
  1,081
  1,170
  1,264
  1,361
  1,462
  1,567
  1,676
  1,790
  1,909
  2,033
  2,163
  2,298
  2,439
  2,586
  2,740
  2,901
  3,070
  3,246
Earnings before tax, $m
  -262
  429
  542
  661
  785
  914
  1,049
  1,190
  1,336
  1,487
  1,645
  2,671
  2,841
  3,018
  3,202
  3,394
  3,593
  3,800
  4,016
  4,241
  4,475
  4,720
  4,975
  5,242
  5,520
  5,811
  6,116
  6,434
  6,767
  7,115
  7,480
Tax expense, $m
  -26
  116
  146
  178
  212
  247
  283
  321
  361
  402
  444
  721
  767
  815
  865
  916
  970
  1,026
  1,084
  1,145
  1,208
  1,274
  1,343
  1,415
  1,490
  1,569
  1,651
  1,737
  1,827
  1,921
  2,019
Net income, $m
  -106
  313
  396
  483
  573
  668
  766
  868
  975
  1,086
  1,201
  1,950
  2,074
  2,203
  2,338
  2,477
  2,623
  2,774
  2,931
  3,096
  3,267
  3,446
  3,632
  3,827
  4,030
  4,242
  4,464
  4,697
  4,940
  5,194
  5,460

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  4,247
  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
  18,174
  18,688
  20,733
  22,878
  25,123
  27,467
  29,910
  32,455
  35,102
  37,855
  40,715
  43,688
  46,777
  49,988
  53,326
  56,797
  60,409
  64,168
  68,083
  72,162
  76,413
  80,847
  85,473
  90,302
  95,346
  100,615
  106,122
  111,881
  117,904
  124,207
  130,803
Adjusted assets (=assets-cash), $m
  13,927
  18,688
  20,733
  22,878
  25,123
  27,467
  29,910
  32,455
  35,102
  37,855
  40,715
  43,688
  46,777
  49,988
  53,326
  56,797
  60,409
  64,168
  68,083
  72,162
  76,413
  80,847
  85,473
  90,302
  95,346
  100,615
  106,122
  111,881
  117,904
  124,207
  130,803
Revenue / Adjusted assets
  0.289
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
  0.240
Average production assets, $m
  2,671
  2,978
  3,304
  3,646
  4,004
  4,377
  4,767
  5,172
  5,594
  6,033
  6,488
  6,962
  7,454
  7,966
  8,498
  9,051
  9,627
  10,226
  10,850
  11,500
  12,177
  12,884
  13,621
  14,391
  15,194
  16,034
  16,912
  17,829
  18,789
  19,794
  20,845
Working capital, $m
  702
  -449
  -498
  -549
  -603
  -659
  -718
  -779
  -842
  -909
  -977
  -1,049
  -1,123
  -1,200
  -1,280
  -1,363
  -1,450
  -1,540
  -1,634
  -1,732
  -1,834
  -1,940
  -2,051
  -2,167
  -2,288
  -2,415
  -2,547
  -2,685
  -2,830
  -2,981
  -3,139
Total debt, $m
  8,186
  8,431
  10,065
  11,778
  13,572
  15,445
  17,397
  19,430
  21,546
  23,745
  26,030
  28,406
  30,874
  33,439
  36,106
  38,880
  41,766
  44,770
  47,897
  51,156
  54,553
  58,096
  61,792
  65,651
  69,680
  73,890
  78,291
  82,892
  87,705
  92,740
  98,011
Total liabilities, $m
  14,687
  14,932
  16,566
  18,279
  20,073
  21,946
  23,898
  25,931
  28,047
  30,246
  32,531
  34,907
  37,375
  39,940
  42,607
  45,381
  48,267
  51,271
  54,398
  57,657
  61,054
  64,597
  68,293
  72,152
  76,181
  80,391
  84,792
  89,393
  94,206
  99,241
  104,512
Total equity, $m
  3,487
  3,756
  4,167
  4,598
  5,050
  5,521
  6,012
  6,523
  7,056
  7,609
  8,184
  8,781
  9,402
  10,048
  10,719
  11,416
  12,142
  12,898
  13,685
  14,505
  15,359
  16,250
  17,180
  18,151
  19,164
  20,224
  21,331
  22,488
  23,699
  24,966
  26,291
Total liabilities and equity, $m
  18,174
  18,688
  20,733
  22,877
  25,123
  27,467
  29,910
  32,454
  35,103
  37,855
  40,715
  43,688
  46,777
  49,988
  53,326
  56,797
  60,409
  64,169
  68,083
  72,162
  76,413
  80,847
  85,473
  90,303
  95,345
  100,615
  106,123
  111,881
  117,905
  124,207
  130,803
Debt-to-equity ratio
  2.348
  2.240
  2.420
  2.560
  2.690
  2.800
  2.890
  2.980
  3.050
  3.120
  3.180
  3.230
  3.280
  3.330
  3.370
  3.410
  3.440
  3.470
  3.500
  3.530
  3.550
  3.580
  3.600
  3.620
  3.640
  3.650
  3.670
  3.690
  3.700
  3.710
  3.730
Adjusted equity ratio
  -0.055
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201
  0.201

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -106
  313
  396
  483
  573
  668
  766
  868
  975
  1,086
  1,201
  1,950
  2,074
  2,203
  2,338
  2,477
  2,623
  2,774
  2,931
  3,096
  3,267
  3,446
  3,632
  3,827
  4,030
  4,242
  4,464
  4,697
  4,940
  5,194
  5,460
Depreciation, amort., depletion, $m
  530
  1,048
  1,068
  1,089
  1,111
  1,135
  1,159
  1,184
  1,210
  1,237
  1,266
  432
  463
  495
  528
  562
  598
  635
  674
  714
  756
  800
  846
  894
  944
  996
  1,050
  1,107
  1,167
  1,229
  1,295
Funds from operations, $m
  -974
  1,361
  1,464
  1,572
  1,684
  1,802
  1,925
  2,052
  2,185
  2,323
  2,466
  2,382
  2,537
  2,698
  2,865
  3,039
  3,221
  3,409
  3,605
  3,810
  4,023
  4,246
  4,478
  4,720
  4,974
  5,238
  5,515
  5,804
  6,107
  6,423
  6,755
Change in working capital, $m
  -754
  -47
  -49
  -51
  -54
  -56
  -59
  -61
  -64
  -66
  -69
  -71
  -74
  -77
  -80
  -83
  -87
  -90
  -94
  -98
  -102
  -106
  -111
  -116
  -121
  -126
  -132
  -138
  -145
  -151
  -158
Cash from operations, $m
  -220
  1,407
  1,513
  1,623
  1,738
  1,858
  1,983
  2,113
  2,249
  2,389
  2,535
  2,454
  2,611
  2,775
  2,946
  3,123
  3,307
  3,499
  3,699
  3,908
  4,125
  4,352
  4,589
  4,836
  5,095
  5,365
  5,647
  5,942
  6,251
  6,575
  6,913
Maintenance CAPEX, $m
  0
  -166
  -185
  -205
  -226
  -249
  -272
  -296
  -321
  -347
  -375
  -403
  -432
  -463
  -495
  -528
  -562
  -598
  -635
  -674
  -714
  -756
  -800
  -846
  -894
  -944
  -996
  -1,050
  -1,107
  -1,167
  -1,229
New CAPEX, $m
  -70
  -308
  -326
  -342
  -358
  -374
  -389
  -406
  -422
  -439
  -456
  -474
  -492
  -512
  -532
  -553
  -576
  -599
  -624
  -650
  -678
  -707
  -737
  -770
  -804
  -840
  -878
  -918
  -960
  -1,004
  -1,051
Cash from investing activities, $m
  -6,766
  -474
  -511
  -547
  -584
  -623
  -661
  -702
  -743
  -786
  -831
  -877
  -924
  -975
  -1,027
  -1,081
  -1,138
  -1,197
  -1,259
  -1,324
  -1,392
  -1,463
  -1,537
  -1,616
  -1,698
  -1,784
  -1,874
  -1,968
  -2,067
  -2,171
  -2,280
Free cash flow, $m
  -6,986
  934
  1,002
  1,076
  1,154
  1,236
  1,322
  1,412
  1,505
  1,603
  1,704
  1,577
  1,687
  1,801
  1,919
  2,042
  2,169
  2,302
  2,440
  2,584
  2,734
  2,889
  3,051
  3,221
  3,397
  3,581
  3,773
  3,974
  4,184
  4,403
  4,633
Issuance/(repayment) of debt, $m
  5,962
  1,555
  1,634
  1,714
  1,793
  1,873
  1,953
  2,033
  2,115
  2,199
  2,286
  2,375
  2,468
  2,565
  2,667
  2,774
  2,886
  3,004
  3,128
  3,259
  3,397
  3,543
  3,696
  3,859
  4,030
  4,210
  4,400
  4,601
  4,813
  5,036
  5,271
Issuance/(repurchase) of shares, $m
  -405
  87
  15
  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  
  5,513
  1,642
  1,649
  1,714
  1,793
  1,873
  1,953
  2,033
  2,115
  2,199
  2,286
  2,375
  2,468
  2,565
  2,667
  2,774
  2,886
  3,004
  3,128
  3,259
  3,397
  3,543
  3,696
  3,859
  4,030
  4,210
  4,400
  4,601
  4,813
  5,036
  5,271
Total cash flow (excl. dividends), $m
  -1,514
  2,576
  2,651
  2,790
  2,948
  3,109
  3,275
  3,445
  3,621
  3,802
  3,990
  3,952
  4,155
  4,366
  4,586
  4,815
  5,055
  5,306
  5,568
  5,843
  6,130
  6,432
  6,748
  7,079
  7,427
  7,791
  8,174
  8,575
  8,997
  9,439
  9,903
Retained Cash Flow (-), $m
  189
  -400
  -411
  -431
  -451
  -471
  -491
  -511
  -532
  -553
  -575
  -598
  -621
  -645
  -671
  -698
  -726
  -756
  -787
  -820
  -855
  -891
  -930
  -971
  -1,014
  -1,059
  -1,107
  -1,157
  -1,211
  -1,267
  -1,326
Prev. year cash balance distribution, $m
 
  131
  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
 
  2,306
  2,240
  2,359
  2,496
  2,638
  2,783
  2,934
  3,089
  3,249
  3,415
  3,355
  3,534
  3,721
  3,915
  4,118
  4,329
  4,550
  4,781
  5,023
  5,276
  5,541
  5,818
  6,109
  6,413
  6,732
  7,067
  7,418
  7,786
  8,172
  8,577
Discount rate, %
 
  7.20
  7.56
  7.94
  8.33
  8.75
  9.19
  9.65
  10.13
  10.64
  11.17
  11.73
  12.31
  12.93
  13.58
  14.26
  14.97
  15.72
  16.50
  17.33
  18.19
  19.10
  20.06
  21.06
  22.11
  23.22
  24.38
  25.60
  26.88
  28.22
  29.64
PV of cash for distribution, $m
 
  2,151
  1,936
  1,876
  1,812
  1,734
  1,643
  1,539
  1,427
  1,308
  1,185
  991
  877
  766
  659
  558
  465
  380
  306
  241
  186
  141
  104
  75
  53
  36
  24
  16
  10
  6
  4
Current shareholders' claim on cash, %
  100
  99.5
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4
  99.4

Symantec Corporation, together with its subsidiaries, provides cybersecurity solutions worldwide. It operates through two segments, Consumer Security and Enterprise Security. The Consumer Security segment offers Norton-branded services that provide multi-layer security and identity protection on desktop and mobile operating systems to defend against online threats to individuals, families, and small businesses. Its Norton Security products help customers protect against complex threats and address the need for identity protection, while also managing mobile and digital data, such as personal financial records, photos, music, and videos. The Enterprise Security segment provides threat protection products, information protection products, cyber security services, and Website security offerings. Its products protect customer data from threats, such as advanced protection threats, malicious spam and phishing attacks, malware, drive-by Website infections, hackers, and cyber criminals; prevent the loss of confidential data by insiders; and help customers achieve and maintain compliance with laws and regulations. This segment delivers its solutions through various methods, such as software, appliance, software-as-a-service, and managed services. The company serves individuals, households, and small businesses; small, medium, and large enterprises; and government and public sector customers. It markets and sells its products and related services through direct sales force, e-commerce platforms, distributors, direct marketers, Internet-based resellers, system builders, Internet service providers, wireless carriers, retailers, original equipment manufacturers, and retail and online stores. Symantec Corporation was founded in 1982 and is headquartered in Mountain View, California.

FINANCIAL RATIOS  of  Symantec (SYMC)

Valuation Ratios
P/E Ratio -162.3
Price to Sales 4.3
Price to Book 4.9
Price to Tangible Book
Price to Cash Flow -78.2
Price to Free Cash Flow -59.3
Growth Rates
Sales Growth Rate 11.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -74.3%
Cap. Spend. - 3 Yr. Gr. Rate -23.1%
Financial Strength
Quick Ratio 3
Current Ratio 0.1
LT Debt to Equity 197.2%
Total Debt to Equity 234.8%
Interest Coverage -1
Management Effectiveness
Return On Assets 0.2%
Ret/ On Assets - 3 Yr. Avg. 8.7%
Return On Total Capital -1.2%
Ret/ On T. Cap. - 3 Yr. Avg. 15.2%
Return On Equity -3%
Return On Equity - 3 Yr. Avg. 21.3%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 78.8%
Gross Margin - 3 Yr. Avg. 81.1%
EBITDA Margin 10.2%
EBITDA Margin - 3 Yr. Avg. 15.6%
Operating Margin -2.5%
Oper. Margin - 3 Yr. Avg. 4.7%
Pre-Tax Margin -6.5%
Pre-Tax Margin - 3 Yr. Avg. 2.3%
Net Profit Margin -2.6%
Net Profit Margin - 3 Yr. Avg. 29.6%
Effective Tax Rate 9.9%
Eff/ Tax Rate - 3 Yr. Avg. 103.8%
Payout Ratio -209.4%

SYMC stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SYMC stock intrinsic value calculation we used $4019 million for the last fiscal year's total revenue generated by Symantec. The default revenue input number comes from 2017 income statement of Symantec. 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 SYMC stock valuation model: a) initial revenue growth rate of 11.6% 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 7.2%, whose default value for SYMC is calculated based on our internal credit rating of Symantec, 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 Symantec.
    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 SYMC stock the variable cost ratio is equal to 87.3%.

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 SYMC 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 Symantec.

Corporate tax rate of 27% is the nominal tax rate for Symantec. 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 SYMC 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 SYMC are equal to 66.4%.

Life of production assets of 16.1 years is the average useful life of capital assets used in Symantec 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 SYMC 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 - $3487 million for Symantec - 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 616.363 million for Symantec 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 Symantec at the current share price and the inputted number of shares is $17.4 billion.

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COMPANY NEWS

▶ Whats Snaps Valuation?   [10:36AM  Market Realist]
▶ FNJN: Blue Coat Systems Appeal to Be Heard September 8, 2017   [10:30AM  Zacks Small Cap Research]
▶ Symantec promises to sell business unit for nearly $1B   [10:12AM  American City Business Journals]
▶ Symantec reports 1Q loss   [12:23AM  Associated Press]
▶ [$$] Symantec Sells Web-Certification Business to DigiCert   [Aug-02-17 06:44PM  The Wall Street Journal]
▶ Symantec Earnings, Revenue Top Expectations, Stock Rises   [05:36PM  Investor's Business Daily]
▶ [$$] The Add-On Deal Roundup: Aug. 2   [04:51PM  The Wall Street Journal]
▶ These Are the 5 Worst Tech Stocks to Own   [Jul-29-17 08:44AM  TheStreet.com]
▶ Symantec's Stock Worth a Security Check   [08:35AM  TheStreet.com]
▶ Why Symantec Corporation Stock Surged 30% So Far in 2017   [Jul-27-17 02:15PM  Motley Fool]
▶ ETFs with exposure to Symantec Corp. : July 25, 2017   [Jul-25-17 01:28PM  Capital Cube]
▶ Comparing Symantecs Valuation   [Jul-17-17 09:08AM  Market Realist]
▶ [$$] Symantec Stock Could Reach $37   [Jul-14-17 05:45AM  Barrons.com]
▶ [$$] Symantec Strikes Another Deal With Skycure Acquisition   [Jul-13-17 07:54PM  The Wall Street Journal]
▶ Symantec to Webcast Quarterly Earnings Call   [09:00AM  Business Wire]
▶ Symantec buys Fireglass   [10:40AM  Reuters Videos]
▶ Symantec buys startup to help protect work browsing, email   [10:23AM  American City Business Journals]
▶ ETFs with exposure to Symantec Corp. : July 3, 2017   [Jul-03-17 03:52PM  Capital Cube]
▶ Petya, WannaCry and the Return of the Worm   [Jun-30-17 08:14PM  TheStreet.com]
▶ 5 Corporate Skunkworks You Should Know About   [Jun-15-17 09:00AM  Fortune]
▶ 15 Tech Stocks Vulnerable to a Pullback (Part 2)   [Jun-09-17 01:45PM  TheStreet.com]
▶ ETFs with exposure to Symantec Corp. : June 5, 2017   [Jun-05-17 02:49PM  Capital Cube]
▶ Symantec Takes Rival Zscaler to Court at a Crucial Juncture   [Jun-02-17 07:38AM  Market Realist]
▶ Stocks Weak At Opening, Analysts Upgrade Symantec, AutoZone, Biohaven   [May-30-17 09:44AM  Investor's Business Daily]
▶ What Analysts Are Recommending for FireEye Stock   [May-29-17 07:36AM  Market Realist]
▶ What Do Technical Indicators Say about FireEye Stock?   [May-26-17 07:36AM  Market Realist]
▶ Is Symantec Finally Worth Watching?   [09:07AM  Market Realist]
▶ [$$] Ending North Koreas Cyber Impunity   [12:25AM  The Wall Street Journal]
Stock chart of SYMC Financial statements of SYMC
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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