Intrinsic value of TEGNA - TGNA

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$25.48

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$25.48

 
Intrinsic value

$162.48

 
Up/down potential

+538%

 
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 TGNA 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 5.4

 

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, %
  9.51
  36.50
  33.35
  30.52
  27.96
  25.67
  23.60
  21.74
  20.07
  18.56
  17.20
  15.98
  14.89
  13.90
  13.01
  12.21
  11.49
  10.84
  10.25
  9.73
  9.26
  8.83
  8.45
  8.10
  7.79
  7.51
  7.26
  7.04
  6.83
  6.65
  6.48
Revenue, $m
  3,341
  4,560
  6,081
  7,937
  10,157
  12,764
  15,776
  19,205
  23,059
  27,339
  32,042
  37,164
  42,696
  48,629
  54,954
  61,662
  68,744
  76,194
  84,006
  92,178
  100,710
  109,602
  118,860
  128,490
  138,501
  148,907
  159,719
  170,956
  182,635
  194,778
  207,406
Variable operating expenses, $m
 
  3,048
  3,929
  5,004
  6,290
  7,800
  9,545
  11,531
  13,764
  16,243
  18,967
  21,527
  24,731
  28,168
  31,832
  35,717
  39,819
  44,135
  48,660
  53,393
  58,335
  63,486
  68,848
  74,426
  80,226
  86,253
  92,516
  99,024
  105,790
  112,823
  120,138
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
  2,369
  3,048
  3,929
  5,004
  6,290
  7,800
  9,545
  11,531
  13,764
  16,243
  18,967
  21,527
  24,731
  28,168
  31,832
  35,717
  39,819
  44,135
  48,660
  53,393
  58,335
  63,486
  68,848
  74,426
  80,226
  86,253
  92,516
  99,024
  105,790
  112,823
  120,138
Operating income, $m
  972
  1,512
  2,152
  2,933
  3,867
  4,964
  6,231
  7,674
  9,296
  11,096
  13,075
  15,637
  17,965
  20,461
  23,122
  25,945
  28,925
  32,059
  35,346
  38,785
  42,375
  46,116
  50,011
  54,063
  58,276
  62,654
  67,203
  71,931
  76,846
  81,955
  87,268
EBITDA, $m
  1,177
  2,078
  2,771
  3,616
  4,627
  5,815
  7,187
  8,750
  10,506
  12,455
  14,598
  16,932
  19,452
  22,155
  25,037
  28,093
  31,319
  34,713
  38,273
  41,996
  45,883
  49,934
  54,152
  58,539
  63,100
  67,841
  72,767
  77,886
  83,207
  88,739
  94,493
Interest expense (income), $m
  225
  222
  348
  505
  696
  925
  1,194
  1,505
  1,859
  2,257
  2,698
  3,183
  3,712
  4,283
  4,895
  5,547
  6,240
  6,970
  7,739
  8,545
  9,388
  10,268
  11,186
  12,141
  13,135
  14,168
  15,241
  16,357
  17,516
  18,721
  19,974
Earnings before tax, $m
  712
  1,290
  1,804
  2,428
  3,170
  4,038
  5,037
  6,169
  7,437
  8,840
  10,377
  12,454
  14,253
  16,178
  18,228
  20,397
  22,685
  25,089
  27,608
  30,240
  32,986
  35,848
  38,826
  41,922
  45,141
  48,486
  51,962
  55,575
  59,329
  63,233
  67,294
Tax expense, $m
  217
  348
  487
  656
  856
  1,090
  1,360
  1,666
  2,008
  2,387
  2,802
  3,362
  3,848
  4,368
  4,921
  5,507
  6,125
  6,774
  7,454
  8,165
  8,906
  9,679
  10,483
  11,319
  12,188
  13,091
  14,030
  15,005
  16,019
  17,073
  18,169
Net income, $m
  437
  942
  1,317
  1,772
  2,314
  2,948
  3,677
  4,503
  5,429
  6,453
  7,575
  9,091
  10,405
  11,810
  13,306
  14,890
  16,560
  18,315
  20,154
  22,075
  24,080
  26,169
  28,343
  30,603
  32,953
  35,395
  37,932
  40,569
  43,310
  46,160
  49,125

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  77
  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
  8,543
  11,545
  15,396
  20,094
  25,713
  32,313
  39,939
  48,621
  58,378
  69,213
  81,120
  94,086
  108,090
  123,111
  139,124
  156,106
  174,036
  192,896
  212,674
  233,363
  254,961
  277,473
  300,911
  325,291
  350,637
  376,979
  404,353
  432,800
  462,367
  493,108
  525,080
Adjusted assets (=assets-cash), $m
  8,466
  11,545
  15,396
  20,094
  25,713
  32,313
  39,939
  48,621
  58,378
  69,213
  81,120
  94,086
  108,090
  123,111
  139,124
  156,106
  174,036
  192,896
  212,674
  233,363
  254,961
  277,473
  300,911
  325,291
  350,637
  376,979
  404,353
  432,800
  462,367
  493,108
  525,080
Revenue / Adjusted assets
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
  0.395
Average production assets, $m
  3,493
  4,766
  6,355
  8,294
  10,614
  13,338
  16,486
  20,070
  24,097
  28,569
  33,484
  38,836
  44,617
  50,817
  57,427
  64,437
  71,838
  79,623
  87,787
  96,326
  105,242
  114,534
  124,208
  134,272
  144,734
  155,607
  166,907
  178,649
  190,854
  203,543
  216,740
Working capital, $m
  172
  132
  176
  230
  295
  370
  457
  557
  669
  793
  929
  1,078
  1,238
  1,410
  1,594
  1,788
  1,994
  2,210
  2,436
  2,673
  2,921
  3,178
  3,447
  3,726
  4,017
  4,318
  4,632
  4,958
  5,296
  5,649
  6,015
Total debt, $m
  4,043
  6,326
  9,179
  12,661
  16,824
  21,715
  27,366
  33,800
  41,029
  49,058
  57,881
  67,489
  77,866
  88,996
  100,862
  113,445
  126,731
  140,707
  155,362
  170,693
  186,697
  203,379
  220,746
  238,811
  257,593
  277,112
  297,396
  318,476
  340,385
  363,164
  386,855
Total liabilities, $m
  6,271
  8,555
  11,408
  14,890
  19,053
  23,944
  29,595
  36,029
  43,258
  51,287
  60,110
  69,718
  80,095
  91,225
  103,091
  115,674
  128,960
  142,936
  157,591
  172,922
  188,926
  205,608
  222,975
  241,040
  259,822
  279,341
  299,625
  320,705
  342,614
  365,393
  389,084
Total equity, $m
  2,271
  2,990
  3,988
  5,204
  6,660
  8,369
  10,344
  12,593
  15,120
  17,926
  21,010
  24,368
  27,995
  31,886
  36,033
  40,431
  45,075
  49,960
  55,083
  60,441
  66,035
  71,866
  77,936
  84,250
  90,815
  97,637
  104,727
  112,095
  119,753
  127,715
  135,996
Total liabilities and equity, $m
  8,542
  11,545
  15,396
  20,094
  25,713
  32,313
  39,939
  48,622
  58,378
  69,213
  81,120
  94,086
  108,090
  123,111
  139,124
  156,105
  174,035
  192,896
  212,674
  233,363
  254,961
  277,474
  300,911
  325,290
  350,637
  376,978
  404,352
  432,800
  462,367
  493,108
  525,080
Debt-to-equity ratio
  1.780
  2.120
  2.300
  2.430
  2.530
  2.590
  2.650
  2.680
  2.710
  2.740
  2.750
  2.770
  2.780
  2.790
  2.800
  2.810
  2.810
  2.820
  2.820
  2.820
  2.830
  2.830
  2.830
  2.830
  2.840
  2.840
  2.840
  2.840
  2.840
  2.840
  2.840
Adjusted equity ratio
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259
  0.259

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  437
  942
  1,317
  1,772
  2,314
  2,948
  3,677
  4,503
  5,429
  6,453
  7,575
  9,091
  10,405
  11,810
  13,306
  14,890
  16,560
  18,315
  20,154
  22,075
  24,080
  26,169
  28,343
  30,603
  32,953
  35,395
  37,932
  40,569
  43,310
  46,160
  49,125
Depreciation, amort., depletion, $m
  205
  566
  619
  683
  761
  851
  956
  1,076
  1,210
  1,359
  1,523
  1,295
  1,487
  1,694
  1,914
  2,148
  2,395
  2,654
  2,926
  3,211
  3,508
  3,818
  4,140
  4,476
  4,824
  5,187
  5,564
  5,955
  6,362
  6,785
  7,225
Funds from operations, $m
  587
  1,507
  1,936
  2,456
  3,075
  3,799
  4,633
  5,579
  6,639
  7,812
  9,098
  10,386
  11,892
  13,504
  15,220
  17,038
  18,955
  20,969
  23,080
  25,286
  27,588
  29,987
  32,483
  35,079
  37,778
  40,582
  43,496
  46,524
  49,672
  52,945
  56,350
Change in working capital, $m
  -96
  35
  44
  54
  64
  76
  87
  99
  112
  124
  136
  149
  160
  172
  183
  195
  205
  216
  227
  237
  247
  258
  268
  279
  290
  302
  314
  326
  339
  352
  366
Cash from operations, $m
  683
  1,442
  1,891
  2,402
  3,011
  3,724
  4,546
  5,480
  6,527
  7,688
  8,962
  10,237
  11,731
  13,332
  15,037
  16,843
  18,749
  20,753
  22,853
  25,049
  27,341
  29,729
  32,214
  34,800
  37,487
  40,280
  43,182
  46,199
  49,334
  52,593
  55,983
Maintenance CAPEX, $m
  0
  -116
  -159
  -212
  -276
  -354
  -445
  -550
  -669
  -803
  -952
  -1,116
  -1,295
  -1,487
  -1,694
  -1,914
  -2,148
  -2,395
  -2,654
  -2,926
  -3,211
  -3,508
  -3,818
  -4,140
  -4,476
  -4,824
  -5,187
  -5,564
  -5,955
  -6,362
  -6,785
New CAPEX, $m
  -95
  -1,273
  -1,589
  -1,939
  -2,319
  -2,724
  -3,148
  -3,584
  -4,027
  -4,472
  -4,915
  -5,352
  -5,781
  -6,200
  -6,610
  -7,010
  -7,401
  -7,785
  -8,164
  -8,540
  -8,915
  -9,292
  -9,674
  -10,063
  -10,462
  -10,873
  -11,299
  -11,742
  -12,205
  -12,689
  -13,197
Cash from investing activities, $m
  -273
  -1,389
  -1,748
  -2,151
  -2,595
  -3,078
  -3,593
  -4,134
  -4,696
  -5,275
  -5,867
  -6,468
  -7,076
  -7,687
  -8,304
  -8,924
  -9,549
  -10,180
  -10,818
  -11,466
  -12,126
  -12,800
  -13,492
  -14,203
  -14,938
  -15,697
  -16,486
  -17,306
  -18,160
  -19,051
  -19,982
Free cash flow, $m
  410
  53
  143
  251
  415
  646
  953
  1,346
  1,831
  2,412
  3,095
  3,769
  4,656
  5,645
  6,733
  7,920
  9,201
  10,573
  12,035
  13,583
  15,215
  16,928
  18,722
  20,596
  22,549
  24,582
  26,696
  28,893
  31,174
  33,542
  36,001
Issuance/(repayment) of debt, $m
  -138
  2,284
  2,853
  3,481
  4,164
  4,890
  5,651
  6,434
  7,230
  8,029
  8,823
  9,608
  10,377
  11,130
  11,866
  12,583
  13,286
  13,975
  14,656
  15,330
  16,004
  16,682
  17,367
  18,065
  18,781
  19,519
  20,284
  21,079
  21,910
  22,779
  23,691
Issuance/(repurchase) of shares, $m
  -182
  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  
  -340
  2,284
  2,853
  3,481
  4,164
  4,890
  5,651
  6,434
  7,230
  8,029
  8,823
  9,608
  10,377
  11,130
  11,866
  12,583
  13,286
  13,975
  14,656
  15,330
  16,004
  16,682
  17,367
  18,065
  18,781
  19,519
  20,284
  21,079
  21,910
  22,779
  23,691
Total cash flow (excl. dividends), $m
  70
  2,337
  2,996
  3,732
  4,578
  5,536
  6,604
  7,780
  9,060
  10,441
  11,918
  13,377
  15,033
  16,775
  18,599
  20,503
  22,487
  24,549
  26,691
  28,914
  31,219
  33,610
  36,089
  38,662
  41,331
  44,102
  46,980
  49,972
  53,083
  56,321
  59,692
Retained Cash Flow (-), $m
  -79
  -795
  -997
  -1,217
  -1,455
  -1,709
  -1,975
  -2,249
  -2,527
  -2,806
  -3,084
  -3,358
  -3,627
  -3,890
  -4,147
  -4,398
  -4,644
  -4,885
  -5,123
  -5,358
  -5,594
  -5,831
  -6,070
  -6,314
  -6,565
  -6,823
  -7,090
  -7,368
  -7,658
  -7,962
  -8,281
Prev. year cash balance distribution, $m
 
  76
  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
 
  1,618
  1,999
  2,515
  3,123
  3,827
  4,629
  5,531
  6,533
  7,635
  8,834
  10,019
  11,406
  12,885
  14,452
  16,105
  17,843
  19,664
  21,568
  23,555
  25,625
  27,779
  30,019
  32,347
  34,766
  37,279
  39,891
  42,604
  45,425
  48,359
  51,412
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
 
  1,481
  1,662
  1,882
  2,083
  2,252
  2,378
  2,451
  2,467
  2,425
  2,327
  2,156
  1,975
  1,765
  1,539
  1,309
  1,085
  876
  689
  527
  392
  283
  198
  135
  89
  56
  35
  20
  12
  6
  3
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

TEGNA Inc. engages in media and digital businesses in the United States. The company operates in two segments, Media and Digital. It operates 46 television stations that produce local programming, such as news, sports, and entertainment. The company also operates Cars.com, an online destination for automotive consumers that offers information about car shopping, selling, and servicing; CareerBuilder, which provides human capital solutions, such as employment data and labor market analysis software, talent management software, and other advertising and recruitment solutions; G/O Digital that provides digital marketing services for local businesses; and Cofactor, a digital marketing company that enable brands to deliver content. In addition, it offers advertising and marketing solutions. The company serves approximately 90 million customers through its broadcast and digital media platforms. The company was formerly known as Gannett Co., Inc. and changed its name to TEGNA Inc. in June 2015. TEGNA Inc. was founded in 1906 and is headquartered in McLean, Virginia.

FINANCIAL RATIOS  of  TEGNA (TGNA)

Valuation Ratios
P/E Ratio 12.5
Price to Sales 1.6
Price to Book 2.4
Price to Tangible Book
Price to Cash Flow 8
Price to Free Cash Flow 9.3
Growth Rates
Sales Growth Rate 9.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -20.2%
Cap. Spend. - 3 Yr. Gr. Rate -2.9%
Financial Strength
Quick Ratio 77
Current Ratio 0
LT Debt to Equity 178%
Total Debt to Equity 178%
Interest Coverage 4
Management Effectiveness
Return On Assets 7%
Ret/ On Assets - 3 Yr. Avg. 8.5%
Return On Total Capital 6.9%
Ret/ On T. Cap. - 3 Yr. Avg. 9.5%
Return On Equity 19.6%
Return On Equity - 3 Yr. Avg. 24.1%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 68.9%
Gross Margin - 3 Yr. Avg. 67.4%
EBITDA Margin 34.2%
EBITDA Margin - 3 Yr. Avg. 43%
Operating Margin 29.1%
Oper. Margin - 3 Yr. Avg. 28.6%
Pre-Tax Margin 21.3%
Pre-Tax Margin - 3 Yr. Avg. 26.5%
Net Profit Margin 13.1%
Net Profit Margin - 3 Yr. Avg. 22.9%
Effective Tax Rate 30.5%
Eff/ Tax Rate - 3 Yr. Avg. 28.9%
Payout Ratio 27.9%

TGNA stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TGNA stock intrinsic value calculation we used $3341 million for the last fiscal year's total revenue generated by TEGNA. The default revenue input number comes from 2016 income statement of TEGNA. 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 TGNA stock valuation model: a) initial revenue growth rate of 36.5% 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 TGNA is calculated based on our internal credit rating of TEGNA, 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 TEGNA.
    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 TGNA stock the variable cost ratio is equal to 70.1%.

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 TGNA 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 5.5% for TEGNA.

Corporate tax rate of 27% is the nominal tax rate for TEGNA. 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 TGNA 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 TGNA are equal to 104.5%.

Life of production assets of 36.5 years is the average useful life of capital assets used in TEGNA 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 TGNA is equal to 2.9%. 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 - $2271 million for TEGNA - 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 212.724 million for TEGNA 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 TEGNA at the current share price and the inputted number of shares is $5.4 billion.


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COMPANY NEWS

▶ TEGNA Wins 82 Regional Edward R. Murrow Awards   [Apr-25-17 03:54PM  Business Wire]
▶ TEGNA Names Jeff Newman Chief Human Resources Officer   [Apr-12-17 11:25AM  Business Wire]
▶ Is The Market Expensive? Buffett Says No   [Mar-20-17 02:55PM  Forbes]
▶ Women in the boardroom: How Greater Washington stacks up   [Mar-13-17 03:51PM  at bizjournals.com]
▶ TEGNA Announces Quarterly Dividend   [Feb-28-17 03:40PM  Business Wire]
▶ [$$] Tegna Revenue and Profit Top Views   [10:58AM  at The Wall Street Journal]
▶ KARE 11 Announces New Anchor/Reporter Assignments   [Jan-19-17 10:00AM  Marketwired]
▶ TEGNA Names Sunny Uberoi Chief Communications Officer   [Jan-03-17 03:14PM  Business Wire]
▶ TEGNA Sells Cofactor   [Dec-15-16 05:00PM  Business Wire]
▶ [$$] Fox News Names New Chief of Human Resources   [Dec-14-16 03:21PM  at The Wall Street Journal]
▶ CareerBuilder and Emsi Release Best Jobs for 2017   [Dec-02-16 04:04AM  PR Newswire]
▶ How Tegna Inc (TGNA) Stacks Up Against Its Peers   [Dec-01-16 04:02PM  at Insider Monkey]
▶ 9News anchor leaving for Atlanta   [Nov-22-16 11:31AM  at bizjournals.com]
Stock chart of TGNA Financial statements of TGNA
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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