Intrinsic value of Tuniu ADR - TOUR

Previous Close

$7.66

  Intrinsic Value

$1.66

stock screener

  Rating & Target

str. sell

-78%

  Value-price divergence*

-69%

Previous close

$7.66

 
Intrinsic value

$1.66

 
Up/down potential

-78%

 
Rating

str. sell

 
Value-price divergence*

-69%

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

We calculate the intrinsic value of TOUR 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 0.9

 

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, %
  37.97
  38.00
  34.70
  31.73
  29.06
  26.65
  24.49
  22.54
  20.78
  19.21
  17.78
  16.51
  15.36
  14.32
  13.39
  12.55
  11.79
  11.11
  10.50
  9.95
  9.46
  9.01
  8.61
  8.25
  7.92
  7.63
  7.37
  7.13
  6.92
  6.73
  6.55
Revenue, $m
  1,526
  2,106
  2,837
  3,737
  4,822
  6,108
  7,603
  9,317
  11,253
  13,414
  15,800
  18,408
  21,235
  24,276
  27,526
  30,980
  34,634
  38,484
  42,526
  46,758
  51,181
  55,793
  60,597
  65,597
  70,795
  76,198
  81,813
  87,648
  93,713
  100,017
  106,572
Variable operating expenses, $m
 
  2,507
  3,377
  4,447
  5,739
  7,268
  9,047
  11,086
  13,389
  15,960
  18,798
  21,899
  25,262
  28,879
  32,745
  36,855
  41,202
  45,781
  50,590
  55,625
  60,886
  66,373
  72,088
  78,035
  84,219
  90,647
  97,327
  104,269
  111,483
  118,982
  126,781
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
  1,891
  2,507
  3,377
  4,447
  5,739
  7,268
  9,047
  11,086
  13,389
  15,960
  18,798
  21,899
  25,262
  28,879
  32,745
  36,855
  41,202
  45,781
  50,590
  55,625
  60,886
  66,373
  72,088
  78,035
  84,219
  90,647
  97,327
  104,269
  111,483
  118,982
  126,781
Operating income, $m
  -364
  -401
  -540
  -711
  -917
  -1,160
  -1,444
  -1,769
  -2,136
  -2,546
  -2,998
  -3,491
  -4,027
  -4,603
  -5,220
  -5,875
  -6,567
  -7,297
  -8,064
  -8,867
  -9,705
  -10,580
  -11,491
  -12,439
  -13,424
  -14,449
  -15,514
  -16,620
  -17,770
  -18,966
  -20,209
EBITDA, $m
  -333
  -370
  -499
  -657
  -848
  -1,074
  -1,337
  -1,638
  -1,979
  -2,359
  -2,778
  -3,237
  -3,734
  -4,268
  -4,840
  -5,447
  -6,090
  -6,766
  -7,477
  -8,221
  -8,999
  -9,810
  -10,654
  -11,533
  -12,447
  -13,397
  -14,385
  -15,411
  -16,477
  -17,585
  -18,738
Interest expense (income), $m
  0
  0
  5
  14
  26
  41
  58
  78
  101
  127
  156
  188
  223
  261
  302
  345
  391
  440
  492
  546
  603
  662
  724
  788
  855
  925
  997
  1,073
  1,151
  1,232
  1,316
Earnings before tax, $m
  -354
  -401
  -545
  -725
  -943
  -1,201
  -1,502
  -1,847
  -2,237
  -2,673
  -3,154
  -3,679
  -4,250
  -4,864
  -5,521
  -6,220
  -6,959
  -7,738
  -8,556
  -9,413
  -10,308
  -11,242
  -12,215
  -13,227
  -14,280
  -15,374
  -16,511
  -17,693
  -18,921
  -20,198
  -21,525
Tax expense, $m
  -1
  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
  -351
  -401
  -545
  -725
  -943
  -1,201
  -1,502
  -1,847
  -2,237
  -2,673
  -3,154
  -3,679
  -4,250
  -4,864
  -5,521
  -6,220
  -6,959
  -7,738
  -8,556
  -9,413
  -10,308
  -11,242
  -12,215
  -13,227
  -14,280
  -15,374
  -16,511
  -17,693
  -18,921
  -20,198
  -21,525

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  678
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  1,327
  896
  1,207
  1,589
  2,051
  2,598
  3,234
  3,963
  4,787
  5,706
  6,721
  7,830
  9,032
  10,326
  11,708
  13,177
  14,732
  16,369
  18,088
  19,889
  21,770
  23,732
  25,775
  27,902
  30,113
  32,411
  34,799
  37,281
  39,861
  42,542
  45,331
Adjusted assets (=assets-cash), $m
  649
  896
  1,207
  1,589
  2,051
  2,598
  3,234
  3,963
  4,787
  5,706
  6,721
  7,830
  9,032
  10,326
  11,708
  13,177
  14,732
  16,369
  18,088
  19,889
  21,770
  23,732
  25,775
  27,902
  30,113
  32,411
  34,799
  37,281
  39,861
  42,542
  45,331
Revenue / Adjusted assets
  2.351
  2.350
  2.350
  2.352
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
  2.351
Average production assets, $m
  106
  145
  196
  258
  333
  421
  525
  643
  776
  926
  1,090
  1,270
  1,465
  1,675
  1,899
  2,138
  2,390
  2,655
  2,934
  3,226
  3,531
  3,850
  4,181
  4,526
  4,885
  5,258
  5,645
  6,048
  6,466
  6,901
  7,353
Working capital, $m
  433
  -339
  -457
  -602
  -776
  -983
  -1,224
  -1,500
  -1,812
  -2,160
  -2,544
  -2,964
  -3,419
  -3,908
  -4,432
  -4,988
  -5,576
  -6,196
  -6,847
  -7,528
  -8,240
  -8,983
  -9,756
  -10,561
  -11,398
  -12,268
  -13,172
  -14,111
  -15,088
  -16,103
  -17,158
Total debt, $m
  0
  130
  410
  754
  1,170
  1,662
  2,235
  2,891
  3,632
  4,459
  5,373
  6,371
  7,453
  8,617
  9,861
  11,184
  12,582
  14,056
  15,604
  17,224
  18,917
  20,683
  22,522
  24,435
  26,425
  28,494
  30,643
  32,877
  35,199
  37,612
  40,122
Total liabilities, $m
  676
  806
  1,086
  1,430
  1,846
  2,338
  2,911
  3,567
  4,308
  5,135
  6,049
  7,047
  8,129
  9,293
  10,537
  11,860
  13,258
  14,732
  16,280
  17,900
  19,593
  21,359
  23,198
  25,111
  27,101
  29,170
  31,319
  33,553
  35,875
  38,288
  40,798
Total equity, $m
  651
  90
  121
  159
  205
  260
  323
  396
  479
  571
  672
  783
  903
  1,033
  1,171
  1,318
  1,473
  1,637
  1,809
  1,989
  2,177
  2,373
  2,578
  2,790
  3,011
  3,241
  3,480
  3,728
  3,986
  4,254
  4,533
Total liabilities and equity, $m
  1,327
  896
  1,207
  1,589
  2,051
  2,598
  3,234
  3,963
  4,787
  5,706
  6,721
  7,830
  9,032
  10,326
  11,708
  13,178
  14,731
  16,369
  18,089
  19,889
  21,770
  23,732
  25,776
  27,901
  30,112
  32,411
  34,799
  37,281
  39,861
  42,542
  45,331
Debt-to-equity ratio
  0.000
  1.450
  3.400
  4.750
  5.700
  6.400
  6.910
  7.290
  7.590
  7.820
  7.990
  8.140
  8.250
  8.350
  8.420
  8.490
  8.540
  8.590
  8.630
  8.660
  8.690
  8.720
  8.740
  8.760
  8.780
  8.790
  8.810
  8.820
  8.830
  8.840
  8.850
Adjusted equity ratio
  -0.042
  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
  -351
  -401
  -545
  -725
  -943
  -1,201
  -1,502
  -1,847
  -2,237
  -2,673
  -3,154
  -3,679
  -4,250
  -4,864
  -5,521
  -6,220
  -6,959
  -7,738
  -8,556
  -9,413
  -10,308
  -11,242
  -12,215
  -13,227
  -14,280
  -15,374
  -16,511
  -17,693
  -18,921
  -20,198
  -21,525
Depreciation, amort., depletion, $m
  31
  31
  41
  54
  69
  86
  107
  131
  157
  187
  220
  254
  293
  335
  380
  428
  478
  531
  587
  645
  706
  770
  836
  905
  977
  1,052
  1,129
  1,210
  1,293
  1,380
  1,471
Funds from operations, $m
  -344
  -370
  -503
  -671
  -874
  -1,115
  -1,395
  -1,716
  -2,080
  -2,486
  -2,934
  -3,425
  -3,957
  -4,529
  -5,141
  -5,792
  -6,481
  -7,207
  -7,969
  -8,767
  -9,602
  -10,472
  -11,378
  -12,322
  -13,303
  -14,322
  -15,382
  -16,483
  -17,628
  -18,817
  -20,054
Change in working capital, $m
  -20
  -93
  -118
  -145
  -175
  -207
  -241
  -276
  -312
  -348
  -384
  -420
  -455
  -490
  -523
  -556
  -588
  -620
  -651
  -681
  -712
  -743
  -773
  -805
  -837
  -870
  -904
  -939
  -976
  -1,015
  -1,055
Cash from operations, $m
  -324
  -277
  -386
  -526
  -699
  -908
  -1,154
  -1,440
  -1,768
  -2,138
  -2,550
  -3,005
  -3,501
  -4,040
  -4,618
  -5,236
  -5,893
  -6,587
  -7,318
  -8,086
  -8,890
  -9,729
  -10,605
  -11,517
  -12,466
  -13,452
  -14,478
  -15,544
  -16,651
  -17,802
  -18,999
Maintenance CAPEX, $m
  0
  -21
  -29
  -39
  -52
  -67
  -84
  -105
  -129
  -155
  -185
  -218
  -254
  -293
  -335
  -380
  -428
  -478
  -531
  -587
  -645
  -706
  -770
  -836
  -905
  -977
  -1,052
  -1,129
  -1,210
  -1,293
  -1,380
New CAPEX, $m
  -17
  -40
  -50
  -62
  -75
  -89
  -103
  -118
  -134
  -149
  -165
  -180
  -195
  -210
  -224
  -238
  -252
  -266
  -279
  -292
  -305
  -318
  -331
  -345
  -359
  -373
  -387
  -403
  -418
  -435
  -452
Cash from investing activities, $m
  -364
  -61
  -79
  -101
  -127
  -156
  -187
  -223
  -263
  -304
  -350
  -398
  -449
  -503
  -559
  -618
  -680
  -744
  -810
  -879
  -950
  -1,024
  -1,101
  -1,181
  -1,264
  -1,350
  -1,439
  -1,532
  -1,628
  -1,728
  -1,832
Free cash flow, $m
  -688
  -338
  -465
  -628
  -826
  -1,063
  -1,342
  -1,664
  -2,030
  -2,442
  -2,900
  -3,403
  -3,951
  -4,542
  -5,177
  -5,854
  -6,572
  -7,331
  -8,128
  -8,965
  -9,840
  -10,754
  -11,706
  -12,698
  -13,730
  -14,802
  -15,917
  -17,075
  -18,279
  -19,531
  -20,832
Issuance/(repayment) of debt, $m
  0
  130
  280
  345
  416
  492
  573
  656
  741
  827
  913
  998
  1,082
  1,164
  1,244
  1,322
  1,399
  1,474
  1,547
  1,620
  1,693
  1,766
  1,839
  1,914
  1,990
  2,068
  2,150
  2,234
  2,322
  2,413
  2,510
Issuance/(repurchase) of shares, $m
  472
  518
  576
  763
  989
  1,256
  1,566
  1,920
  2,320
  2,765
  3,256
  3,790
  4,370
  4,993
  5,659
  6,367
  7,114
  7,902
  8,728
  9,593
  10,496
  11,438
  12,419
  13,440
  14,501
  15,604
  16,750
  17,941
  19,179
  20,466
  21,804
Cash from financing (excl. dividends), $m  
  525
  648
  856
  1,108
  1,405
  1,748
  2,139
  2,576
  3,061
  3,592
  4,169
  4,788
  5,452
  6,157
  6,903
  7,689
  8,513
  9,376
  10,275
  11,213
  12,189
  13,204
  14,258
  15,354
  16,491
  17,672
  18,900
  20,175
  21,501
  22,879
  24,314
Total cash flow (excl. dividends), $m
  -147
  310
  390
  480
  579
  685
  796
  912
  1,031
  1,150
  1,269
  1,385
  1,501
  1,615
  1,726
  1,835
  1,941
  2,045
  2,147
  2,248
  2,349
  2,450
  2,552
  2,655
  2,761
  2,870
  2,982
  3,099
  3,221
  3,348
  3,482
Retained Cash Flow (-), $m
  -170
  -518
  -576
  -763
  -989
  -1,256
  -1,566
  -1,920
  -2,320
  -2,765
  -3,256
  -3,790
  -4,370
  -4,993
  -5,659
  -6,367
  -7,114
  -7,902
  -8,728
  -9,593
  -10,496
  -11,438
  -12,419
  -13,440
  -14,501
  -15,604
  -16,750
  -17,941
  -19,179
  -20,466
  -21,804
Prev. year cash balance distribution, $m
 
  678
  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
 
  470
  -185
  -283
  -410
  -571
  -769
  -1,008
  -1,289
  -1,615
  -1,986
  -2,404
  -2,868
  -3,378
  -3,933
  -4,532
  -5,174
  -5,857
  -6,581
  -7,345
  -8,147
  -8,988
  -9,867
  -10,784
  -11,740
  -12,734
  -13,767
  -14,842
  -15,958
  -17,117
  -18,322
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
 
  451
  -170
  -246
  -338
  -443
  -558
  -681
  -806
  -928
  -1,041
  -1,142
  -1,224
  -1,284
  -1,320
  -1,330
  -1,315
  -1,274
  -1,212
  -1,131
  -1,035
  -930
  -819
  -707
  -598
  -495
  -402
  -319
  -247
  -187
  -138
Current shareholders' claim on cash, %
  100
  50.0
  9.2
  1.7
  0.3
  0.1
  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

Tuniu Corporation is an online leisure travel company. The Company offers a selection of packaged tours, including organized tours and self-guided tours, as well as travel-related services for leisure travelers. Its online platform, which consists of its tuniu.com Website and mobile platform, provides product and travel information to enable leisure travelers to plan their travels. Its organized tours offer pre-arranged itineraries, transportation, accommodations, entertainment, meals and tour guide services. Its self-guided tours consist of combinations of flights and hotel bookings and other optional add-ons, such as airport pick-ups. Its other travel-related services include sales of tourist attraction tickets, visa processing services, financial services, hotel booking services and air ticketing services. Its online platform contains travel guides featuring photos, information and recommendations for all destinations it covers.

FINANCIAL RATIOS  of  Tuniu ADR (TOUR)

Valuation Ratios
P/E Ratio -8.3
Price to Sales 1.9
Price to Book 4.5
Price to Tangible Book
Price to Cash Flow -9
Price to Free Cash Flow -8.5
Growth Rates
Sales Growth Rate 38%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -22.7%
Cap. Spend. - 3 Yr. Gr. Rate 76.2%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -29.7%
Ret/ On Assets - 3 Yr. Avg. -27.8%
Return On Total Capital -62%
Ret/ On T. Cap. - 3 Yr. Avg. -58.8%
Return On Equity -62%
Return On Equity - 3 Yr. Avg. -58.8%
Asset Turnover 1.3
Profitability Ratios
Gross Margin 6%
Gross Margin - 3 Yr. Avg. 5.8%
EBITDA Margin -21.2%
EBITDA Margin - 3 Yr. Avg. -17.2%
Operating Margin -23.9%
Oper. Margin - 3 Yr. Avg. -18.8%
Pre-Tax Margin -23.2%
Pre-Tax Margin - 3 Yr. Avg. -18.4%
Net Profit Margin -23%
Net Profit Margin - 3 Yr. Avg. -18.3%
Effective Tax Rate 0.3%
Eff/ Tax Rate - 3 Yr. Avg. 0.1%
Payout Ratio 0%

TOUR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TOUR stock intrinsic value calculation we used $1526 million for the last fiscal year's total revenue generated by Tuniu ADR. The default revenue input number comes from 2016 income statement of Tuniu ADR. 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 TOUR stock valuation model: a) initial revenue growth rate of 38% 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 TOUR is calculated based on our internal credit rating of Tuniu ADR, 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 Tuniu ADR.
    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 TOUR stock the variable cost ratio is equal to 119.1%.

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 TOUR 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 Tuniu ADR.

Corporate tax rate of 27% is the nominal tax rate for Tuniu ADR. 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 TOUR 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 TOUR are equal to 6.9%.

Life of production assets of 4.1 years is the average useful life of capital assets used in Tuniu ADR 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 TOUR is equal to -16.1%. 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 - $651 million for Tuniu ADR - 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 123.084 million for Tuniu ADR 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 Tuniu ADR at the current share price and the inputted number of shares is $0.9 billion.

RELATED COMPANIES Price Int.Val. Rating
CTRP Ctrip.com Inte 48.35 150.80  str.buy
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JD JD.com ADR 39.00 318.82  str.buy

COMPANY NEWS

▶ Tuniu reports 2Q loss   [Aug-16-17 11:16PM  Associated Press]
▶ ETFs with exposure to Tuniu Corp. : July 10, 2017   [Jul-10-17 03:21PM  Capital Cube]
▶ ETFs with exposure to Tuniu Corp. : June 6, 2017   [Jun-06-17 11:49AM  Capital Cube]
▶ Tuniu reports 1Q loss   [06:36AM  Associated Press]
▶ Tuniu Corporation Files Its Annual Report on Form 20-F   [Apr-17-17 06:00AM  PR Newswire]
▶ Tuniu reports 4Q loss   [06:17AM  Associated Press]
▶ Tuniu CFO: Online Travel Is Growing Fast   [Jan-23-17 08:41PM  Bloomberg Video]
▶ [$$] Chinese travel platform Tuniu banking on JD.com tie-up   [Dec-22-16 09:14AM  at Financial Times]
▶ Do Hedge Funds Love Tuniu Corp (TOUR)?   [Dec-15-16 10:00AM  Insider Monkey]
▶ Do Hedge Funds Love Tuniu Corp (TOUR)?   [10:00AM  at Insider Monkey]
▶ Tuniu is tapping into Chinese demand for outbound travel   [Nov-30-16 08:59PM  CNBC Videos]
▶ TUNIU CORP Financials   [01:04PM  EDGAR Online Financials]
▶ Tuniu Corporation Files Its Annual Report on Form 20-F   [Apr-28-16 09:30AM  PR Newswire]
▶ Tuniu Announces the Appointment of New Board Directors   [Feb-25-16 04:30AM  PR Newswire]
▶ Ctrip Partners With Rival Qunar: Goldman Raises Both To Buy   [Oct-26  08:19AM  at Barrons.com]
▶ Tuniu Appoints Chief Marketing Officer   [Oct-11  09:52PM  GlobeNewswire]
▶ Why Ctrip Is A Better Bet Than Qunar   [Jul-22  02:18AM  at Barrons.com]
▶ Which Chinese ADRs Will Go Home? Follow Sequoia Capital   [Jun-17  09:33PM  at Barrons.com]
▶ 3 Stocks Rising on Unusual Volume   [Jun-08  02:44PM  at TheStreet]
▶ Tuniu Announces the Appointment of New Directors   [May-25  07:26AM  GlobeNewswire]
Financial statements of TOUR
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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