Intrinsic value of Weibo ADR - WB

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$55.86

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$55.86

 
Intrinsic value

$175.85

 
Up/down potential

+215%

 
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 WB 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 11.8

 

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, %
  37.24
  43.00
  39.20
  35.78
  32.70
  29.93
  27.44
  25.19
  23.18
  21.36
  19.72
  18.25
  16.92
  15.73
  14.66
  13.69
  12.82
  12.04
  11.34
  10.70
  10.13
  9.62
  9.16
  8.74
  8.37
  8.03
  7.73
  7.46
  7.21
  6.99
  6.79
Revenue, $m
  656
  938
  1,306
  1,773
  2,353
  3,057
  3,896
  4,877
  6,008
  7,291
  8,729
  10,322
  12,069
  13,968
  16,015
  18,208
  20,543
  23,017
  25,626
  28,369
  31,244
  34,250
  37,386
  40,654
  44,056
  47,595
  51,273
  55,095
  59,067
  63,195
  67,486
Variable operating expenses, $m
 
  395
  550
  746
  991
  1,287
  1,640
  2,053
  2,529
  3,070
  3,675
  4,346
  5,081
  5,880
  6,742
  7,666
  8,649
  9,690
  10,789
  11,943
  13,154
  14,419
  15,740
  17,116
  18,548
  20,037
  21,586
  23,195
  24,867
  26,605
  28,412
Fixed operating expenses, $m
 
  251
  257
  264
  270
  277
  284
  291
  299
  306
  314
  321
  329
  338
  346
  355
  364
  373
  382
  392
  401
  411
  422
  432
  443
  454
  466
  477
  489
  501
  514
Total operating expenses, $m
  515
  646
  807
  1,010
  1,261
  1,564
  1,924
  2,344
  2,828
  3,376
  3,989
  4,667
  5,410
  6,218
  7,088
  8,021
  9,013
  10,063
  11,171
  12,335
  13,555
  14,830
  16,162
  17,548
  18,991
  20,491
  22,052
  23,672
  25,356
  27,106
  28,926
Operating income, $m
  141
  292
  499
  763
  1,092
  1,493
  1,972
  2,533
  3,180
  3,916
  4,740
  5,655
  6,658
  7,750
  8,927
  10,188
  11,531
  12,954
  14,455
  16,034
  17,689
  19,419
  21,225
  23,107
  25,065
  27,103
  29,221
  31,423
  33,711
  36,089
  38,561
EBITDA, $m
  162
  297
  506
  772
  1,105
  1,509
  1,993
  2,559
  3,212
  3,955
  4,788
  5,711
  6,724
  7,825
  9,013
  10,286
  11,642
  13,078
  14,594
  16,187
  17,857
  19,604
  21,427
  23,326
  25,303
  27,360
  29,498
  31,720
  34,030
  36,430
  38,925
Interest expense (income), $m
  0
  0
  4
  10
  17
  26
  36
  49
  64
  81
  101
  122
  147
  173
  202
  233
  266
  301
  339
  378
  420
  464
  509
  557
  606
  658
  711
  767
  825
  885
  948
Earnings before tax, $m
  110
  292
  494
  753
  1,075
  1,467
  1,935
  2,484
  3,116
  3,834
  4,640
  5,533
  6,512
  7,577
  8,725
  9,955
  11,265
  12,652
  14,117
  15,656
  17,269
  18,955
  20,716
  22,550
  24,459
  26,445
  28,510
  30,656
  32,886
  35,203
  37,613
Tax expense, $m
  4
  79
  133
  203
  290
  396
  523
  671
  841
  1,035
  1,253
  1,494
  1,758
  2,046
  2,356
  2,688
  3,041
  3,416
  3,811
  4,227
  4,663
  5,118
  5,593
  6,088
  6,604
  7,140
  7,698
  8,277
  8,879
  9,505
  10,155
Net income, $m
  108
  213
  361
  550
  785
  1,071
  1,413
  1,813
  2,275
  2,799
  3,387
  4,039
  4,754
  5,531
  6,369
  7,267
  8,223
  9,236
  10,305
  11,429
  12,606
  13,837
  15,122
  16,461
  17,855
  19,305
  20,812
  22,379
  24,007
  25,699
  27,457

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  396
  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
  1,037
  917
  1,276
  1,733
  2,300
  2,988
  3,808
  4,768
  5,873
  7,127
  8,533
  10,090
  11,798
  13,654
  15,655
  17,799
  20,081
  22,499
  25,050
  27,731
  30,541
  33,480
  36,546
  39,740
  43,066
  46,525
  50,120
  53,856
  57,739
  61,775
  65,969
Adjusted assets (=assets-cash), $m
  641
  917
  1,276
  1,733
  2,300
  2,988
  3,808
  4,768
  5,873
  7,127
  8,533
  10,090
  11,798
  13,654
  15,655
  17,799
  20,081
  22,499
  25,050
  27,731
  30,541
  33,480
  36,546
  39,740
  43,066
  46,525
  50,120
  53,856
  57,739
  61,775
  65,969
Revenue / Adjusted assets
  1.023
  1.023
  1.024
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
  1.023
Average production assets, $m
  18
  25
  35
  48
  64
  83
  105
  132
  162
  197
  236
  279
  326
  377
  432
  492
  555
  621
  692
  766
  844
  925
  1,009
  1,098
  1,190
  1,285
  1,384
  1,488
  1,595
  1,706
  1,822
Working capital, $m
  319
  -110
  -153
  -207
  -275
  -358
  -456
  -571
  -703
  -853
  -1,021
  -1,208
  -1,412
  -1,634
  -1,874
  -2,130
  -2,404
  -2,693
  -2,998
  -3,319
  -3,656
  -4,007
  -4,374
  -4,757
  -5,155
  -5,569
  -5,999
  -6,446
  -6,911
  -7,394
  -7,896
Total debt, $m
  0
  122
  281
  484
  735
  1,040
  1,403
  1,828
  2,318
  2,873
  3,496
  4,186
  4,942
  5,765
  6,651
  7,601
  8,612
  9,683
  10,813
  12,001
  13,246
  14,547
  15,906
  17,321
  18,794
  20,326
  21,919
  23,574
  25,295
  27,082
  28,940
Total liabilities, $m
  284
  406
  565
  768
  1,019
  1,324
  1,687
  2,112
  2,602
  3,157
  3,780
  4,470
  5,226
  6,049
  6,935
  7,885
  8,896
  9,967
  11,097
  12,285
  13,530
  14,831
  16,190
  17,605
  19,078
  20,610
  22,203
  23,858
  25,579
  27,366
  29,224
Total equity, $m
  753
  511
  711
  965
  1,281
  1,665
  2,121
  2,656
  3,271
  3,970
  4,753
  5,620
  6,571
  7,605
  8,720
  9,914
  11,185
  12,532
  13,953
  15,446
  17,012
  18,648
  20,356
  22,135
  23,988
  25,914
  27,917
  29,998
  32,161
  34,408
  36,745
Total liabilities and equity, $m
  1,037
  917
  1,276
  1,733
  2,300
  2,989
  3,808
  4,768
  5,873
  7,127
  8,533
  10,090
  11,797
  13,654
  15,655
  17,799
  20,081
  22,499
  25,050
  27,731
  30,542
  33,479
  36,546
  39,740
  43,066
  46,524
  50,120
  53,856
  57,740
  61,774
  65,969
Debt-to-equity ratio
  0.000
  0.240
  0.400
  0.500
  0.570
  0.620
  0.660
  0.690
  0.710
  0.720
  0.740
  0.740
  0.750
  0.760
  0.760
  0.770
  0.770
  0.770
  0.770
  0.780
  0.780
  0.780
  0.780
  0.780
  0.780
  0.780
  0.790
  0.790
  0.790
  0.790
  0.790
Adjusted equity ratio
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557
  0.557

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  108
  213
  361
  550
  785
  1,071
  1,413
  1,813
  2,275
  2,799
  3,387
  4,039
  4,754
  5,531
  6,369
  7,267
  8,223
  9,236
  10,305
  11,429
  12,606
  13,837
  15,122
  16,461
  17,855
  19,305
  20,812
  22,379
  24,007
  25,699
  27,457
Depreciation, amort., depletion, $m
  21
  5
  7
  10
  13
  17
  21
  26
  32
  39
  47
  56
  65
  75
  86
  98
  111
  124
  138
  153
  169
  185
  202
  220
  238
  257
  277
  298
  319
  341
  364
Funds from operations, $m
  276
  218
  368
  559
  797
  1,088
  1,434
  1,839
  2,307
  2,838
  3,434
  4,095
  4,819
  5,606
  6,456
  7,365
  8,334
  9,361
  10,443
  11,582
  12,775
  14,022
  15,324
  16,681
  18,093
  19,562
  21,089
  22,676
  24,326
  26,040
  27,822
Change in working capital, $m
  94
  -33
  -43
  -55
  -68
  -82
  -98
  -115
  -132
  -150
  -168
  -186
  -204
  -222
  -240
  -257
  -273
  -289
  -305
  -321
  -336
  -352
  -367
  -382
  -398
  -414
  -430
  -447
  -465
  -483
  -502
Cash from operations, $m
  182
  244
  411
  614
  865
  1,170
  1,532
  1,954
  2,439
  2,989
  3,602
  4,281
  5,023
  5,828
  6,695
  7,622
  8,607
  9,650
  10,749
  11,903
  13,111
  14,374
  15,691
  17,063
  18,491
  19,976
  21,519
  23,123
  24,790
  26,523
  28,324
Maintenance CAPEX, $m
  0
  -4
  -5
  -7
  -10
  -13
  -17
  -21
  -26
  -32
  -39
  -47
  -56
  -65
  -75
  -86
  -98
  -111
  -124
  -138
  -153
  -169
  -185
  -202
  -220
  -238
  -257
  -277
  -298
  -319
  -341
New CAPEX, $m
  -11
  -7
  -10
  -13
  -16
  -19
  -23
  -27
  -31
  -35
  -39
  -43
  -47
  -51
  -55
  -59
  -63
  -67
  -70
  -74
  -78
  -81
  -85
  -88
  -92
  -96
  -99
  -103
  -107
  -111
  -116
Cash from investing activities, $m
  -228
  -11
  -15
  -20
  -26
  -32
  -40
  -48
  -57
  -67
  -78
  -90
  -103
  -116
  -130
  -145
  -161
  -178
  -194
  -212
  -231
  -250
  -270
  -290
  -312
  -334
  -356
  -380
  -405
  -430
  -457
Free cash flow, $m
  -46
  233
  396
  594
  840
  1,138
  1,493
  1,907
  2,383
  2,922
  3,524
  4,191
  4,920
  5,712
  6,564
  7,476
  8,446
  9,472
  10,554
  11,690
  12,880
  14,124
  15,422
  16,773
  18,180
  19,643
  21,163
  22,743
  24,386
  26,092
  27,867
Issuance/(repayment) of debt, $m
  -3
  122
  159
  202
  251
  305
  363
  425
  489
  556
  623
  690
  757
  822
  887
  950
  1,011
  1,071
  1,130
  1,188
  1,245
  1,302
  1,358
  1,415
  1,473
  1,532
  1,593
  1,655
  1,720
  1,788
  1,858
Issuance/(repurchase) of shares, $m
  8
  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  
  5
  122
  159
  202
  251
  305
  363
  425
  489
  556
  623
  690
  757
  822
  887
  950
  1,011
  1,071
  1,130
  1,188
  1,245
  1,302
  1,358
  1,415
  1,473
  1,532
  1,593
  1,655
  1,720
  1,788
  1,858
Total cash flow (excl. dividends), $m
  -47
  356
  555
  797
  1,091
  1,443
  1,856
  2,332
  2,872
  3,477
  4,147
  4,881
  5,677
  6,534
  7,451
  8,426
  9,457
  10,544
  11,684
  12,878
  14,125
  15,426
  16,780
  18,189
  19,653
  21,175
  22,756
  24,399
  26,106
  27,880
  29,725
Retained Cash Flow (-), $m
  -132
  -154
  -200
  -254
  -316
  -383
  -457
  -534
  -615
  -699
  -783
  -867
  -951
  -1,034
  -1,115
  -1,194
  -1,271
  -1,347
  -1,421
  -1,493
  -1,565
  -1,637
  -1,708
  -1,780
  -1,852
  -1,926
  -2,003
  -2,081
  -2,163
  -2,248
  -2,336
Prev. year cash balance distribution, $m
 
  396
  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
 
  598
  355
  542
  775
  1,060
  1,399
  1,797
  2,257
  2,779
  3,364
  4,013
  4,726
  5,500
  6,336
  7,232
  8,186
  9,197
  10,263
  11,385
  12,560
  13,789
  15,072
  16,409
  17,801
  19,248
  20,753
  22,317
  23,943
  25,632
  27,389
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
 
  573
  325
  472
  638
  821
  1,015
  1,214
  1,410
  1,596
  1,764
  1,906
  2,017
  2,091
  2,127
  2,123
  2,080
  2,001
  1,890
  1,753
  1,596
  1,426
  1,251
  1,075
  907
  749
  605
  479
  370
  280
  206
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

Weibo Corporation operates as a social media platform for people to create, distribute, and discover Chinese-language content. It operates through two segments, Advertising and Marketing Services, and Other Services. The company offers self-expression products that enable its users to express themselves on its platform; social products to promote social interaction between users on its platform; discovery products to help users discover content on its platform; and notifications to notify users on Weibo account activities through SMS or push notification on their device. It also provides third-party online games, including role playing, card, strategy, and real life simulation games, as well as various services and functions to VIP members; and develops mobile apps comprising Weibo Headlines that aggregates news and information from Weibo and other online sources, as well as Weibo Weather, a weather app. In addition, the company offers advertising and marketing solutions, such as social display ads; and promoted feeds, accounts, and trends to enable its customers to promote their brands and conduct marketing activities. Further, it provides products that allow its platform partners to link their Websites and mobile apps to its platform, enabling their users to share content to Weibo; application programming interfaces, which allow third-party developers to build apps to serve individual and organization users; Weibo Credit that allows its users to purchase in-game virtual items and other fee-based services on Weibo, as well as for its platform partners to receive payment in a secure and trusted environment; and Weibo wallet, enabling individuals and businesses to hand out red envelops to build a follower base. The company was formerly known as T.CN Corporation and changed its name to Weibo Corporation in 2012. The company was founded in 2009 and is headquartered in Beijing, China. Weibo Corporation is a subsidiary of SINA Corporation.

FINANCIAL RATIOS  of  Weibo ADR (WB)

Valuation Ratios
P/E Ratio 109.7
Price to Sales 18.1
Price to Book 15.7
Price to Tangible Book
Price to Cash Flow 65.1
Price to Free Cash Flow 69.3
Growth Rates
Sales Growth Rate 37.2%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -26.7%
Cap. Spend. - 3 Yr. Gr. Rate -10.4%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 11.5%
Ret/ On Assets - 3 Yr. Avg. 2%
Return On Total Capital 15.7%
Ret/ On T. Cap. - 3 Yr. Avg. 1.8%
Return On Equity 15.7%
Return On Equity - 3 Yr. Avg. 1.8%
Asset Turnover 0.7
Profitability Ratios
Gross Margin 73.9%
Gross Margin - 3 Yr. Avg. 73.1%
EBITDA Margin 20%
EBITDA Margin - 3 Yr. Avg. 6.6%
Operating Margin 21.5%
Oper. Margin - 3 Yr. Avg. 7.6%
Pre-Tax Margin 16.8%
Pre-Tax Margin - 3 Yr. Avg. 1.8%
Net Profit Margin 16.5%
Net Profit Margin - 3 Yr. Avg. 1.4%
Effective Tax Rate 3.6%
Eff/ Tax Rate - 3 Yr. Avg. 3.4%
Payout Ratio 0%

WB stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the WB stock intrinsic value calculation we used $656 million for the last fiscal year's total revenue generated by Weibo ADR. The default revenue input number comes from 2016 income statement of Weibo 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 WB stock valuation model: a) initial revenue growth rate of 43% 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 WB is calculated based on our internal credit rating of Weibo 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 Weibo 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 WB stock the variable cost ratio is equal to 42.1%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $245 million in the base year in the intrinsic value calculation for WB 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 Weibo ADR.

Corporate tax rate of 27% is the nominal tax rate for Weibo 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 WB 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 WB are equal to 2.7%.

Life of production assets of 1.1 years is the average useful life of capital assets used in Weibo 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 WB is equal to -11.7%. 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 - $753 million for Weibo 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 211.575 million for Weibo 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 Weibo ADR at the current share price and the inputted number of shares is $11.8 billion.


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Stock chart of WB Financial statements of WB
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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