Intrinsic value of Vista Outdoor - VSTO

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$19.06

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$19.06

 
Intrinsic value

$122.15

 
Up/down potential

+541%

 
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 VSTO stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 1.1

 

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, %
  9.03
  10.30
  9.77
  9.29
  8.86
  8.48
  8.13
  7.82
  7.53
  7.28
  7.05
  6.85
  6.66
  6.50
  6.35
  6.21
  6.09
  5.98
  5.88
  5.80
  5.72
  5.64
  5.58
  5.52
  5.47
  5.42
  5.38
  5.34
  5.31
  5.28
  5.25
Revenue, $m
  2,271
  2,505
  2,750
  3,005
  3,272
  3,549
  3,837
  4,137
  4,449
  4,773
  5,110
  5,460
  5,823
  6,202
  6,595
  7,005
  7,432
  7,876
  8,340
  8,823
  9,327
  9,854
  10,404
  10,978
  11,579
  12,207
  12,863
  13,551
  14,270
  15,023
  15,812
Variable operating expenses, $m
 
  1,442
  1,573
  1,710
  1,852
  2,001
  2,155
  2,316
  2,482
  2,656
  2,836
  2,921
  3,115
  3,318
  3,528
  3,747
  3,976
  4,214
  4,461
  4,720
  4,990
  5,271
  5,566
  5,873
  6,194
  6,530
  6,881
  7,249
  7,634
  8,037
  8,459
Fixed operating expenses, $m
 
  726
  744
  762
  781
  801
  821
  842
  863
  884
  906
  929
  952
  976
  1,000
  1,025
  1,051
  1,077
  1,104
  1,132
  1,160
  1,189
  1,219
  1,249
  1,281
  1,313
  1,345
  1,379
  1,414
  1,449
  1,485
Total operating expenses, $m
  2,008
  2,168
  2,317
  2,472
  2,633
  2,802
  2,976
  3,158
  3,345
  3,540
  3,742
  3,850
  4,067
  4,294
  4,528
  4,772
  5,027
  5,291
  5,565
  5,852
  6,150
  6,460
  6,785
  7,122
  7,475
  7,843
  8,226
  8,628
  9,048
  9,486
  9,944
Operating income, $m
  263
  337
  433
  533
  638
  747
  861
  980
  1,104
  1,233
  1,368
  1,610
  1,756
  1,908
  2,067
  2,232
  2,405
  2,586
  2,774
  2,971
  3,178
  3,393
  3,619
  3,856
  4,104
  4,364
  4,637
  4,923
  5,223
  5,538
  5,868
EBITDA, $m
  336
  477
  576
  680
  789
  902
  1,021
  1,144
  1,273
  1,407
  1,546
  1,691
  1,843
  2,000
  2,165
  2,337
  2,516
  2,703
  2,898
  3,103
  3,316
  3,540
  3,774
  4,020
  4,277
  4,546
  4,828
  5,124
  5,435
  5,761
  6,104
Interest expense (income), $m
  0
  23
  27
  32
  37
  42
  48
  53
  59
  65
  72
  78
  85
  92
  99
  107
  115
  123
  132
  141
  150
  160
  170
  181
  192
  204
  216
  229
  242
  256
  271
Earnings before tax, $m
  238
  314
  405
  501
  601
  705
  814
  927
  1,045
  1,168
  1,296
  1,532
  1,671
  1,816
  1,967
  2,125
  2,290
  2,462
  2,642
  2,830
  3,027
  3,233
  3,449
  3,675
  3,912
  4,160
  4,420
  4,694
  4,980
  5,281
  5,597
Tax expense, $m
  91
  85
  109
  135
  162
  190
  220
  250
  282
  315
  350
  414
  451
  490
  531
  574
  618
  665
  713
  764
  817
  873
  931
  992
  1,056
  1,123
  1,194
  1,267
  1,345
  1,426
  1,511
Net income, $m
  147
  229
  296
  366
  438
  514
  594
  677
  763
  853
  946
  1,118
  1,220
  1,326
  1,436
  1,551
  1,672
  1,797
  1,929
  2,066
  2,210
  2,360
  2,518
  2,683
  2,856
  3,037
  3,227
  3,426
  3,636
  3,855
  4,086

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  152
  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
  2,943
  3,077
  3,378
  3,692
  4,019
  4,360
  4,714
  5,083
  5,466
  5,864
  6,277
  6,707
  7,154
  7,619
  8,102
  8,606
  9,130
  9,676
  10,245
  10,839
  11,459
  12,106
  12,781
  13,487
  14,225
  14,996
  15,803
  16,647
  17,531
  18,456
  19,425
Adjusted assets (=assets-cash), $m
  2,791
  3,077
  3,378
  3,692
  4,019
  4,360
  4,714
  5,083
  5,466
  5,864
  6,277
  6,707
  7,154
  7,619
  8,102
  8,606
  9,130
  9,676
  10,245
  10,839
  11,459
  12,106
  12,781
  13,487
  14,225
  14,996
  15,803
  16,647
  17,531
  18,456
  19,425
Revenue / Adjusted assets
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
Average production assets, $m
  781
  862
  946
  1,034
  1,125
  1,221
  1,320
  1,423
  1,530
  1,642
  1,758
  1,878
  2,003
  2,133
  2,269
  2,410
  2,557
  2,709
  2,869
  3,035
  3,209
  3,390
  3,579
  3,777
  3,983
  4,199
  4,425
  4,661
  4,909
  5,168
  5,439
Working capital, $m
  681
  604
  663
  724
  788
  855
  925
  997
  1,072
  1,150
  1,231
  1,316
  1,403
  1,495
  1,589
  1,688
  1,791
  1,898
  2,010
  2,126
  2,248
  2,375
  2,507
  2,646
  2,790
  2,942
  3,100
  3,266
  3,439
  3,621
  3,811
Total debt, $m
  670
  781
  917
  1,059
  1,208
  1,362
  1,523
  1,689
  1,863
  2,043
  2,231
  2,425
  2,628
  2,838
  3,057
  3,285
  3,523
  3,770
  4,028
  4,297
  4,578
  4,871
  5,177
  5,497
  5,831
  6,180
  6,546
  6,928
  7,328
  7,747
  8,186
Total liabilities, $m
  1,282
  1,394
  1,530
  1,672
  1,821
  1,975
  2,136
  2,302
  2,476
  2,656
  2,844
  3,038
  3,241
  3,451
  3,670
  3,898
  4,136
  4,383
  4,641
  4,910
  5,191
  5,484
  5,790
  6,110
  6,444
  6,793
  7,159
  7,541
  7,941
  8,360
  8,799
Total equity, $m
  1,660
  1,683
  1,848
  2,019
  2,198
  2,385
  2,579
  2,780
  2,990
  3,207
  3,434
  3,669
  3,913
  4,168
  4,432
  4,707
  4,994
  5,293
  5,604
  5,929
  6,268
  6,622
  6,991
  7,377
  7,781
  8,203
  8,644
  9,106
  9,589
  10,095
  10,625
Total liabilities and equity, $m
  2,942
  3,077
  3,378
  3,691
  4,019
  4,360
  4,715
  5,082
  5,466
  5,863
  6,278
  6,707
  7,154
  7,619
  8,102
  8,605
  9,130
  9,676
  10,245
  10,839
  11,459
  12,106
  12,781
  13,487
  14,225
  14,996
  15,803
  16,647
  17,530
  18,455
  19,424
Debt-to-equity ratio
  0.404
  0.460
  0.500
  0.520
  0.550
  0.570
  0.590
  0.610
  0.620
  0.640
  0.650
  0.660
  0.670
  0.680
  0.690
  0.700
  0.710
  0.710
  0.720
  0.720
  0.730
  0.740
  0.740
  0.750
  0.750
  0.750
  0.760
  0.760
  0.760
  0.770
  0.770
Adjusted equity ratio
  0.540
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547
  0.547

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  147
  229
  296
  366
  438
  514
  594
  677
  763
  853
  946
  1,118
  1,220
  1,326
  1,436
  1,551
  1,672
  1,797
  1,929
  2,066
  2,210
  2,360
  2,518
  2,683
  2,856
  3,037
  3,227
  3,426
  3,636
  3,855
  4,086
Depreciation, amort., depletion, $m
  73
  140
  143
  147
  151
  155
  159
  164
  169
  173
  178
  81
  87
  92
  98
  104
  111
  117
  124
  131
  139
  147
  155
  163
  172
  182
  192
  202
  213
  224
  235
Funds from operations, $m
  164
  369
  439
  513
  589
  670
  753
  841
  931
  1,026
  1,125
  1,200
  1,307
  1,418
  1,534
  1,656
  1,782
  1,915
  2,053
  2,198
  2,349
  2,507
  2,673
  2,846
  3,028
  3,219
  3,418
  3,628
  3,848
  4,079
  4,321
Change in working capital, $m
  -34
  56
  59
  62
  64
  67
  70
  72
  75
  78
  81
  84
  88
  91
  95
  99
  103
  107
  112
  116
  122
  127
  133
  138
  145
  151
  158
  166
  173
  181
  190
Cash from operations, $m
  198
  386
  380
  451
  525
  603
  684
  768
  856
  948
  1,043
  1,115
  1,219
  1,327
  1,440
  1,557
  1,680
  1,808
  1,941
  2,081
  2,227
  2,380
  2,540
  2,708
  2,883
  3,067
  3,260
  3,462
  3,675
  3,897
  4,131
Maintenance CAPEX, $m
  0
  -34
  -37
  -41
  -45
  -49
  -53
  -57
  -62
  -66
  -71
  -76
  -81
  -87
  -92
  -98
  -104
  -111
  -117
  -124
  -131
  -139
  -147
  -155
  -163
  -172
  -182
  -192
  -202
  -213
  -224
New CAPEX, $m
  -42
  -81
  -84
  -88
  -92
  -95
  -99
  -103
  -107
  -111
  -116
  -120
  -125
  -130
  -135
  -141
  -147
  -153
  -159
  -166
  -173
  -181
  -189
  -198
  -207
  -216
  -226
  -236
  -247
  -259
  -271
Cash from investing activities, $m
  -503
  -115
  -121
  -129
  -137
  -144
  -152
  -160
  -169
  -177
  -187
  -196
  -206
  -217
  -227
  -239
  -251
  -264
  -276
  -290
  -304
  -320
  -336
  -353
  -370
  -388
  -408
  -428
  -449
  -472
  -495
Free cash flow, $m
  -305
  271
  259
  322
  389
  459
  532
  608
  687
  770
  857
  919
  1,012
  1,110
  1,212
  1,318
  1,429
  1,544
  1,665
  1,791
  1,922
  2,060
  2,204
  2,355
  2,513
  2,679
  2,852
  3,035
  3,225
  3,426
  3,636
Issuance/(repayment) of debt, $m
  333
  129
  136
  142
  148
  154
  161
  167
  173
  180
  187
  195
  202
  211
  219
  228
  237
  247
  258
  269
  281
  293
  306
  320
  334
  349
  366
  382
  400
  419
  439
Issuance/(repurchase) of shares, $m
  -143
  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  
  193
  129
  136
  142
  148
  154
  161
  167
  173
  180
  187
  195
  202
  211
  219
  228
  237
  247
  258
  269
  281
  293
  306
  320
  334
  349
  366
  382
  400
  419
  439
Total cash flow (excl. dividends), $m
  -112
  400
  395
  464
  537
  613
  692
  775
  861
  951
  1,044
  1,114
  1,215
  1,321
  1,431
  1,546
  1,666
  1,791
  1,923
  2,060
  2,203
  2,353
  2,510
  2,675
  2,847
  3,028
  3,218
  3,417
  3,626
  3,845
  4,075
Retained Cash Flow (-), $m
  -11
  -157
  -164
  -172
  -179
  -186
  -194
  -202
  -209
  -218
  -226
  -235
  -244
  -254
  -265
  -275
  -287
  -299
  -311
  -325
  -339
  -354
  -369
  -386
  -404
  -422
  -441
  -462
  -483
  -506
  -530
Prev. year cash balance distribution, $m
 
  134
  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
 
  377
  230
  293
  358
  427
  498
  573
  651
  733
  818
  878
  970
  1,066
  1,166
  1,271
  1,379
  1,493
  1,611
  1,735
  1,864
  1,999
  2,141
  2,289
  2,444
  2,606
  2,777
  2,955
  3,142
  3,339
  3,545
Discount rate, %
 
  4.80
  5.04
  5.29
  5.56
  5.83
  6.13
  6.43
  6.75
  7.09
  7.45
  7.82
  8.21
  8.62
  9.05
  9.50
  9.98
  10.48
  11.00
  11.55
  12.13
  12.74
  13.37
  14.04
  14.74
  15.48
  16.25
  17.07
  17.92
  18.82
  19.76
PV of cash for distribution, $m
 
  359
  209
  251
  288
  321
  349
  371
  386
  396
  399
  384
  377
  364
  347
  326
  301
  274
  246
  217
  189
  161
  135
  111
  90
  71
  55
  42
  31
  22
  16
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

Vista Outdoor Inc. designs, manufactures, and markets consumer products for the outdoor sports and recreation markets worldwide. The company’s Shooting Sports segment designs, develops, produces, and sources ammunition for the hunting and sport shooting enthusiast markets, as well as for local law enforcement, the United States government, and international markets under the Federal Premium, Speer, American Eagle, Blazer, CCI, Estate Cartridge, Stevens, Fusion, Savage Arms, Savage Range Systems, Force on Force, and Independence brands; and provides firearms products, such as centerfire rifles, rimfire rifles, shotguns, and range systems. Its Outdoor Products segment offers archery/hunting accessories, such as hunting arrows, game calls, hunting blinds, game cameras, and waterfowl decoys; eyewear and sport protection products comprising safety and protective eyewear, fashion and sports eyewear, and helmets; golf products, including laser rangefinders; and hydration products consisting of hydration packs and water bottles. This segment also offers optics products, such as binoculars, riflescopes, and telescopes; shooting accessories, including reloading equipment, clay targets, and premium gun care products; tactical products comprising holsters, duty gear, bags, and packs; and water sports products, such as stand up paddle boards. It provides its products under the Alliant Powder, Bee Stinger, BLACKHAWK!, Bollé, Bushnell, Butler Creek, CamelBak, Cébé, Champion Target, Eagle, Final Approach, Gold Tip, GunMate, Gunslick Pro, Hoppe's, Jimmy Styks, M-Pro 7, Millett, Night Optics, Outers, Primos, RCBS, Redfield, Serengeti, Simmons, Stoney Point, Tasco, Uncle Mike's, and Weaver brand names. The company sells its products to outdoor enthusiasts, hunters and recreational shooters, athletes, and law enforcement and military professionals through various mass, specialty, and independent retailers. The company was incorporated in 2014 and is headquartered in Farmington, Utah.

FINANCIAL RATIOS  of  Vista Outdoor (VSTO)

Valuation Ratios
P/E Ratio 7.5
Price to Sales 0.5
Price to Book 0.7
Price to Tangible Book
Price to Cash Flow 5.6
Price to Free Cash Flow 7
Growth Rates
Sales Growth Rate 9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -2.3%
Cap. Spend. - 3 Yr. Gr. Rate 12.8%
Financial Strength
Quick Ratio 8
Current Ratio 0.1
LT Debt to Equity 39.3%
Total Debt to Equity 40.4%
Interest Coverage 0
Management Effectiveness
Return On Assets 5.4%
Ret/ On Assets - 3 Yr. Avg. 5.6%
Return On Total Capital 6.8%
Ret/ On T. Cap. - 3 Yr. Avg. 7.3%
Return On Equity 8.9%
Return On Equity - 3 Yr. Avg. 11.4%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 27.3%
Gross Margin - 3 Yr. Avg. 25.9%
EBITDA Margin 13.7%
EBITDA Margin - 3 Yr. Avg. 12.8%
Operating Margin 11.6%
Oper. Margin - 3 Yr. Avg. 11%
Pre-Tax Margin 10.5%
Pre-Tax Margin - 3 Yr. Avg. 9.8%
Net Profit Margin 6.5%
Net Profit Margin - 3 Yr. Avg. 5.8%
Effective Tax Rate 38.2%
Eff/ Tax Rate - 3 Yr. Avg. 41.8%
Payout Ratio 0%

VSTO stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the VSTO stock intrinsic value calculation we used $2271 million for the last fiscal year's total revenue generated by Vista Outdoor. The default revenue input number comes from 2016 income statement of Vista Outdoor. 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 VSTO stock valuation model: a) initial revenue growth rate of 10.3% 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 4.8%, whose default value for VSTO is calculated based on our internal credit rating of Vista Outdoor, 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 Vista Outdoor.
    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 VSTO stock the variable cost ratio is equal to 58%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $708 million in the base year in the intrinsic value calculation for VSTO 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 Vista Outdoor.

Corporate tax rate of 27% is the nominal tax rate for Vista Outdoor. 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 VSTO 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 VSTO are equal to 34.4%.

Life of production assets of 23.1 years is the average useful life of capital assets used in Vista Outdoor 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 VSTO is equal to 24.1%. 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 - $1660 million for Vista Outdoor - 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 58.281 million for Vista Outdoor 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 Vista Outdoor at the current share price and the inputted number of shares is $1.1 billion.


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