Intrinsic value of Tailored Brands - TLRD

Previous Close

$11.83

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

  Value-price divergence*

0%

Previous close

$11.83

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

 
Value-price divergence*

0%

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

We calculate the intrinsic value of TLRD 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 0.6

 

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, %
  -3.35
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  3,379
  3,447
  3,526
  3,616
  3,718
  3,831
  3,955
  4,089
  4,235
  4,392
  4,561
  4,741
  4,933
  5,138
  5,356
  5,587
  5,832
  6,091
  6,365
  6,655
  6,961
  7,283
  7,623
  7,982
  8,360
  8,758
  9,177
  9,618
  10,082
  10,570
  11,084
Variable operating expenses, $m
 
  4,522
  4,625
  4,744
  4,877
  5,025
  5,186
  5,363
  5,553
  5,759
  5,980
  6,204
  6,456
  6,724
  7,009
  7,311
  7,631
  7,970
  8,329
  8,708
  9,108
  9,530
  9,976
  10,445
  10,939
  11,460
  12,008
  12,586
  13,193
  13,832
  14,504
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
  3,244
  4,522
  4,625
  4,744
  4,877
  5,025
  5,186
  5,363
  5,553
  5,759
  5,980
  6,204
  6,456
  6,724
  7,009
  7,311
  7,631
  7,970
  8,329
  8,708
  9,108
  9,530
  9,976
  10,445
  10,939
  11,460
  12,008
  12,586
  13,193
  13,832
  14,504
Operating income, $m
  135
  -1,075
  -1,100
  -1,128
  -1,159
  -1,194
  -1,232
  -1,273
  -1,318
  -1,367
  -1,419
  -1,463
  -1,522
  -1,585
  -1,653
  -1,724
  -1,799
  -1,879
  -1,964
  -2,053
  -2,148
  -2,247
  -2,352
  -2,463
  -2,579
  -2,702
  -2,831
  -2,968
  -3,111
  -3,261
  -3,420
EBITDA, $m
  250
  -994
  -1,017
  -1,043
  -1,072
  -1,105
  -1,141
  -1,180
  -1,222
  -1,267
  -1,315
  -1,367
  -1,423
  -1,482
  -1,545
  -1,612
  -1,682
  -1,757
  -1,836
  -1,919
  -2,008
  -2,101
  -2,199
  -2,302
  -2,411
  -2,526
  -2,647
  -2,774
  -2,908
  -3,049
  -3,197
Interest expense (income), $m
  96
  94
  78
  80
  83
  87
  90
  94
  99
  104
  109
  114
  120
  127
  133
  141
  148
  156
  165
  174
  183
  193
  204
  215
  227
  240
  253
  266
  281
  296
  312
Earnings before tax, $m
  32
  -1,169
  -1,177
  -1,208
  -1,242
  -1,280
  -1,322
  -1,368
  -1,417
  -1,470
  -1,528
  -1,577
  -1,642
  -1,712
  -1,786
  -1,864
  -1,948
  -2,036
  -2,129
  -2,227
  -2,331
  -2,441
  -2,556
  -2,678
  -2,806
  -2,942
  -3,084
  -3,234
  -3,392
  -3,558
  -3,732
Tax expense, $m
  7
  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
Net income, $m
  25
  -1,169
  -1,177
  -1,208
  -1,242
  -1,280
  -1,322
  -1,368
  -1,417
  -1,470
  -1,528
  -1,577
  -1,642
  -1,712
  -1,786
  -1,864
  -1,948
  -2,036
  -2,129
  -2,227
  -2,331
  -2,441
  -2,556
  -2,678
  -2,806
  -2,942
  -3,084
  -3,234
  -3,392
  -3,558
  -3,732

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  71
  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
  2,098
  2,139
  2,189
  2,245
  2,308
  2,378
  2,455
  2,538
  2,629
  2,726
  2,831
  2,943
  3,062
  3,190
  3,325
  3,468
  3,620
  3,781
  3,951
  4,131
  4,321
  4,521
  4,732
  4,955
  5,189
  5,436
  5,696
  5,970
  6,258
  6,561
  6,880
Adjusted assets (=assets-cash), $m
  2,027
  2,139
  2,189
  2,245
  2,308
  2,378
  2,455
  2,538
  2,629
  2,726
  2,831
  2,943
  3,062
  3,190
  3,325
  3,468
  3,620
  3,781
  3,951
  4,131
  4,321
  4,521
  4,732
  4,955
  5,189
  5,436
  5,696
  5,970
  6,258
  6,561
  6,880
Revenue / Adjusted assets
  1.667
  1.612
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
  1.611
Average production assets, $m
  679
  693
  709
  727
  747
  770
  795
  822
  851
  883
  917
  953
  992
  1,033
  1,077
  1,123
  1,172
  1,224
  1,279
  1,338
  1,399
  1,464
  1,532
  1,604
  1,680
  1,760
  1,845
  1,933
  2,027
  2,125
  2,228
Working capital, $m
  706
  662
  677
  694
  714
  736
  759
  785
  813
  843
  876
  910
  947
  987
  1,028
  1,073
  1,120
  1,169
  1,222
  1,278
  1,336
  1,398
  1,464
  1,533
  1,605
  1,682
  1,762
  1,847
  1,936
  2,030
  2,128
Total debt, $m
  1,596
  1,315
  1,360
  1,410
  1,467
  1,530
  1,599
  1,675
  1,756
  1,844
  1,938
  2,039
  2,146
  2,261
  2,382
  2,511
  2,648
  2,793
  2,946
  3,108
  3,279
  3,459
  3,649
  3,849
  4,060
  4,283
  4,517
  4,763
  5,023
  5,295
  5,582
Total liabilities, $m
  2,205
  1,925
  1,970
  2,020
  2,077
  2,140
  2,209
  2,285
  2,366
  2,454
  2,548
  2,649
  2,756
  2,871
  2,992
  3,121
  3,258
  3,403
  3,556
  3,718
  3,889
  4,069
  4,259
  4,459
  4,670
  4,893
  5,127
  5,373
  5,633
  5,905
  6,192
Total equity, $m
  -108
  214
  219
  224
  231
  238
  245
  254
  263
  273
  283
  294
  306
  319
  332
  347
  362
  378
  395
  413
  432
  452
  473
  495
  519
  544
  570
  597
  626
  656
  688
Total liabilities and equity, $m
  2,097
  2,139
  2,189
  2,244
  2,308
  2,378
  2,454
  2,539
  2,629
  2,727
  2,831
  2,943
  3,062
  3,190
  3,324
  3,468
  3,620
  3,781
  3,951
  4,131
  4,321
  4,521
  4,732
  4,954
  5,189
  5,437
  5,697
  5,970
  6,259
  6,561
  6,880
Debt-to-equity ratio
  -14.778
  6.150
  6.210
  6.280
  6.360
  6.430
  6.520
  6.600
  6.680
  6.760
  6.850
  6.930
  7.010
  7.090
  7.170
  7.240
  7.310
  7.390
  7.460
  7.520
  7.590
  7.650
  7.710
  7.770
  7.820
  7.880
  7.930
  7.980
  8.030
  8.070
  8.110
Adjusted equity ratio
  -0.088
  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
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  25
  -1,169
  -1,177
  -1,208
  -1,242
  -1,280
  -1,322
  -1,368
  -1,417
  -1,470
  -1,528
  -1,577
  -1,642
  -1,712
  -1,786
  -1,864
  -1,948
  -2,036
  -2,129
  -2,227
  -2,331
  -2,441
  -2,556
  -2,678
  -2,806
  -2,942
  -3,084
  -3,234
  -3,392
  -3,558
  -3,732
Depreciation, amort., depletion, $m
  115
  81
  83
  84
  86
  89
  91
  94
  97
  100
  103
  95
  99
  103
  108
  112
  117
  122
  128
  134
  140
  146
  153
  160
  168
  176
  184
  193
  203
  212
  223
Funds from operations, $m
  280
  -1,088
  -1,095
  -1,123
  -1,156
  -1,192
  -1,231
  -1,274
  -1,320
  -1,370
  -1,424
  -1,482
  -1,543
  -1,609
  -1,678
  -1,752
  -1,830
  -1,913
  -2,001
  -2,093
  -2,191
  -2,294
  -2,403
  -2,518
  -2,638
  -2,766
  -2,900
  -3,041
  -3,189
  -3,345
  -3,509
Change in working capital, $m
  37
  13
  15
  17
  20
  22
  24
  26
  28
  30
  32
  35
  37
  39
  42
  44
  47
  50
  53
  56
  59
  62
  65
  69
  73
  76
  80
  85
  89
  94
  99
Cash from operations, $m
  243
  -1,101
  -1,110
  -1,141
  -1,175
  -1,213
  -1,255
  -1,300
  -1,348
  -1,401
  -1,457
  -1,516
  -1,580
  -1,648
  -1,720
  -1,796
  -1,877
  -1,963
  -2,053
  -2,149
  -2,250
  -2,356
  -2,468
  -2,586
  -2,711
  -2,842
  -2,980
  -3,125
  -3,278
  -3,439
  -3,608
Maintenance CAPEX, $m
  0
  -68
  -69
  -71
  -73
  -75
  -77
  -79
  -82
  -85
  -88
  -92
  -95
  -99
  -103
  -108
  -112
  -117
  -122
  -128
  -134
  -140
  -146
  -153
  -160
  -168
  -176
  -184
  -193
  -203
  -212
New CAPEX, $m
  -100
  -14
  -16
  -18
  -20
  -23
  -25
  -27
  -29
  -32
  -34
  -36
  -39
  -41
  -44
  -46
  -49
  -52
  -55
  -58
  -61
  -65
  -68
  -72
  -76
  -80
  -84
  -89
  -93
  -98
  -103
Cash from investing activities, $m
  -99
  -82
  -85
  -89
  -93
  -98
  -102
  -106
  -111
  -117
  -122
  -128
  -134
  -140
  -147
  -154
  -161
  -169
  -177
  -186
  -195
  -205
  -214
  -225
  -236
  -248
  -260
  -273
  -286
  -301
  -315
Free cash flow, $m
  144
  -1,183
  -1,195
  -1,230
  -1,268
  -1,311
  -1,357
  -1,406
  -1,460
  -1,517
  -1,579
  -1,644
  -1,714
  -1,788
  -1,867
  -1,951
  -2,039
  -2,132
  -2,231
  -2,335
  -2,445
  -2,561
  -2,683
  -2,812
  -2,947
  -3,090
  -3,240
  -3,399
  -3,565
  -3,740
  -3,924
Issuance/(repayment) of debt, $m
  -64
  -281
  44
  51
  57
  63
  69
  75
  81
  88
  94
  101
  107
  114
  122
  129
  137
  145
  153
  162
  171
  180
  190
  200
  211
  222
  234
  246
  259
  273
  287
Issuance/(repurchase) of shares, $m
  2
  1,491
  1,182
  1,213
  1,248
  1,287
  1,330
  1,376
  1,426
  1,480
  1,538
  1,588
  1,654
  1,725
  1,799
  1,879
  1,963
  2,052
  2,146
  2,245
  2,350
  2,461
  2,577
  2,700
  2,830
  2,966
  3,110
  3,261
  3,421
  3,588
  3,764
Cash from financing (excl. dividends), $m  
  -64
  1,210
  1,226
  1,264
  1,305
  1,350
  1,399
  1,451
  1,507
  1,568
  1,632
  1,689
  1,761
  1,839
  1,921
  2,008
  2,100
  2,197
  2,299
  2,407
  2,521
  2,641
  2,767
  2,900
  3,041
  3,188
  3,344
  3,507
  3,680
  3,861
  4,051
Total cash flow (excl. dividends), $m
  76
  27
  31
  34
  37
  40
  42
  45
  48
  51
  53
  45
  48
  51
  54
  57
  61
  64
  68
  72
  76
  80
  84
  89
  94
  99
  104
  109
  115
  121
  127
Retained Cash Flow (-), $m
  8
  -1,491
  -1,182
  -1,213
  -1,248
  -1,287
  -1,330
  -1,376
  -1,426
  -1,480
  -1,538
  -1,588
  -1,654
  -1,725
  -1,799
  -1,879
  -1,963
  -2,052
  -2,146
  -2,245
  -2,350
  -2,461
  -2,577
  -2,700
  -2,830
  -2,966
  -3,110
  -3,261
  -3,421
  -3,588
  -3,764
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -1,464
  -1,151
  -1,179
  -1,212
  -1,248
  -1,287
  -1,331
  -1,378
  -1,430
  -1,485
  -1,544
  -1,607
  -1,674
  -1,745
  -1,821
  -1,902
  -1,987
  -2,078
  -2,173
  -2,274
  -2,381
  -2,493
  -2,611
  -2,736
  -2,868
  -3,006
  -3,152
  -3,306
  -3,467
  -3,637
Discount rate, %
 
  14.20
  14.91
  15.66
  16.44
  17.26
  18.12
  19.03
  19.98
  20.98
  22.03
  23.13
  24.29
  25.50
  26.78
  28.12
  29.52
  31.00
  32.55
  34.17
  35.88
  37.68
  39.56
  41.54
  43.62
  45.80
  48.09
  50.49
  53.02
  55.67
  58.45
PV of cash for distribution, $m
 
  -1,282
  -871
  -762
  -659
  -563
  -474
  -393
  -321
  -258
  -203
  -157
  -118
  -87
  -63
  -44
  -30
  -20
  -13
  -8
  -5
  -3
  -2
  -1
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  50.0
  7.7
  1.2
  0.2
  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
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Tailored Brands, Inc. operates as a specialty apparel retailer in the United States, Puerto Rico, and Canada. The company operates in two segments, Retail and Corporate Apparel. The Retail segment offers suits, suit separates, sport coats, slacks, formalwear, business casual, sportswear, outerwear, dress shirts, dress pants, ties, shoes, and accessories for men in classic, modern, and slim fits in various sizes; and a selection of tuxedo rental products. It also offers women's career apparel, sportswear, shoes, and accessories; children's apparel; alteration services; and retail dry cleaning, laundry, and heirlooming services. As of January 30, 2016, this segment operated 1,724 stores under the Men's Wearhouse/Men's Wearhouse and Tux, Jos. A. Bank, Joseph Abboud, Moores, and K&G brands; menswearhouse.com, josbank.com, and josephabboud.com Internet sites; and 35 retail dry cleaning, laundry, and heirlooming facilities. The Corporate Apparel segment provides corporate clothing uniforms and work wear to workforces under the Twin Hill, Dimensions, Alexandra, and Yaffy brands through various channels, including managed corporate accounts and catalogs, as well as through twinhill.com, dimensions.co.uk, and alexandra.co.uk Internet sites. This segment serves companies and organizations in the airline, retail grocery, retail, banking, distribution, travel and leisure, postal, security, healthcare, and public sectors. The company was formerly known as The Men’s Wearhouse, Inc. and changed its name to Tailored Brands, Inc. in February 2016. Tailored Brands, Inc. was founded in 1973 and is based in Houston, Texas.

FINANCIAL RATIOS  of  Tailored Brands (TLRD)

Valuation Ratios
P/E Ratio 23
Price to Sales 0.2
Price to Book -5.3
Price to Tangible Book
Price to Cash Flow 2.4
Price to Free Cash Flow 4
Growth Rates
Sales Growth Rate -3.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -13.8%
Cap. Spend. - 3 Yr. Gr. Rate -1.5%
Financial Strength
Quick Ratio 5
Current Ratio 0
LT Debt to Equity -1465.7%
Total Debt to Equity -1477.8%
Interest Coverage 1
Management Effectiveness
Return On Assets 4.6%
Ret/ On Assets - 3 Yr. Avg. -9.4%
Return On Total Capital 1.6%
Ret/ On T. Cap. - 3 Yr. Avg. -15.9%
Return On Equity -24%
Return On Equity - 3 Yr. Avg. -86.7%
Asset Turnover 1.6
Profitability Ratios
Gross Margin 42.6%
Gross Margin - 3 Yr. Avg. 42.3%
EBITDA Margin 7.2%
EBITDA Margin - 3 Yr. Avg. -5.2%
Operating Margin 4%
Oper. Margin - 3 Yr. Avg. -8.3%
Pre-Tax Margin 0.9%
Pre-Tax Margin - 3 Yr. Avg. -11%
Net Profit Margin 0.7%
Net Profit Margin - 3 Yr. Avg. -9.5%
Effective Tax Rate 21.9%
Eff/ Tax Rate - 3 Yr. Avg. 45.3%
Payout Ratio 140%

TLRD stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TLRD stock intrinsic value calculation we used $3379 million for the last fiscal year's total revenue generated by Tailored Brands. The default revenue input number comes from 2017 income statement of Tailored Brands. 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 TLRD stock valuation model: a) initial revenue growth rate of 2% 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 14.2%, whose default value for TLRD is calculated based on our internal credit rating of Tailored Brands, 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 Tailored Brands.
    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 TLRD stock the variable cost ratio is equal to 131.2%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for TLRD 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 5.9% for Tailored Brands.

Corporate tax rate of 27% is the nominal tax rate for Tailored Brands. 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 TLRD 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 TLRD are equal to 20.1%.

Life of production assets of 10 years is the average useful life of capital assets used in Tailored Brands 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 TLRD is equal to 19.2%. 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 - $-108 million for Tailored Brands - 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 47.951 million for Tailored Brands 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 Tailored Brands at the current share price and the inputted number of shares is $0.6 billion.

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COMPANY NEWS

▶ Tailored Brands' Board Joins NACD   [Jul-18-17 04:15PM  PR Newswire]
▶ These 3 Stocks Have Lost Over 50% in 2017   [Jul-16-17 07:07PM  Motley Fool]
▶ 3 Dividend Stocks for Long-Term Investors   [Jul-10-17 11:55AM  Motley Fool]
▶ Top Ranked Income Stocks to Buy for July 3rd   [Jul-03-17 11:24AM  Zacks]
▶ 3 Stocks That Have Lost More Than 50% So Far in 2017   [Jun-28-17 08:32AM  Motley Fool]
▶ Top Ranked Value Stocks to Buy for June 23rd   [Jun-23-17 11:46AM  Zacks]
▶ American will change uniform maker after employee complaints   [Jun-21-17 05:53PM  Associated Press]
▶ Tailored Brands, Inc. Declares Quarterly Cash Dividend   [Jun-16-17 07:00AM  PR Newswire]
▶ Story Stocks from Briefing.com   [10:36AM  Briefing.com]
▶ Jos. A. Bank sales continue to decline but at a slower pace   [Jun-07-17 05:30PM  American City Business Journals]
▶ Tailored Brands tops 1Q profit forecasts   [04:27PM  Associated Press]
▶ 5 Excellent Value Picks with Discounted PEG   [May-24-17 09:06AM  Zacks]
▶ Lower sales drag down Macy's profit, results miss forecast   [May-11-17 12:44PM  Associated Press]
▶ Instant Analysis: Tailored Brands and Macy's Part Ways   [May-09-17 07:33PM  Motley Fool]
▶ American Airlines names new leader at LAX   [02:20PM  American City Business Journals]
▶ Marathon Oil and Facebook slip while Fitbit climbs   [May-04-17 04:33PM  Associated Press]
▶ Macy's severs ties with Men's Wearhouse   [11:50AM  American City Business Journals]
▶ ETFs with exposure to Tailored Brands, Inc. : May 1, 2017   [May-01-17 04:30PM  Capital Cube]
▶ 3 Stocks That Have Been Cut in Half This Year   [Apr-19-17 03:25PM  Motley Fool]
▶ American Airlines pilots starting to speak up over uniform crisis   [Apr-18-17 02:35PM  American City Business Journals]
▶ 2 Incredibly Cheap High-Yield Dividend Stocks   [Apr-14-17 07:51AM  Motley Fool]
▶ Men's Wearhouse parent company names new president   [10:45AM  at bizjournals.com]
▶ Men's Wearhouse parent company names new president   [10:45AM  American City Business Journals]
▶ Macy's tuxedo rental partnership isn't working out so well   [Mar-10-17 11:30AM  at bizjournals.com]
▶ What Happened in the Stock Market Today   [Mar-09-17 05:07PM  at Motley Fool]
▶ 5 More Retail Stocks Not To Buy   [02:06PM  at Barrons.com]
▶ Why Shares of Tailored Brands Crashed Today   [12:40PM  at Motley Fool]
▶ Jos. A. Bank stabilizing amid 'challenging retail environment'   [Mar-08-17 08:40PM  at bizjournals.com]
Stock chart of TLRD Financial statements of TLRD Annual reports of TLRD
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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