Intrinsic value of VCA - WOOF

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$91.63

  Intrinsic Value

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  Rating & Target

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  Value-price divergence*

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Previous close

$91.63

 
Intrinsic value

$119.84

 
Up/down potential

+31%

 
Rating

buy

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

We calculate the intrinsic value of WOOF 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 7.5

 

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, %
  17.95
  20.40
  18.86
  17.47
  16.23
  15.10
  14.09
  13.18
  12.37
  11.63
  10.97
  10.37
  9.83
  9.35
  8.91
  8.52
  8.17
  7.85
  7.57
  7.31
  7.08
  6.87
  6.69
  6.52
  6.36
  6.23
  6.11
  6.00
  5.90
  5.81
  5.73
Revenue, $m
  2,517
  3,030
  3,602
  4,231
  4,918
  5,661
  6,459
  7,310
  8,214
  9,169
  10,175
  11,230
  12,334
  13,487
  14,690
  15,942
  17,244
  18,599
  20,006
  21,469
  22,989
  24,569
  26,211
  27,920
  29,697
  31,546
  33,472
  35,479
  37,571
  39,752
  42,028
Variable operating expenses, $m
 
  2,517
  2,950
  3,428
  3,949
  4,513
  5,119
  5,765
  6,451
  7,176
  7,939
  8,524
  9,362
  10,237
  11,150
  12,100
  13,089
  14,117
  15,185
  16,296
  17,449
  18,648
  19,895
  21,192
  22,540
  23,944
  25,406
  26,929
  28,517
  30,173
  31,900
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  2,132
  2,517
  2,950
  3,428
  3,949
  4,513
  5,119
  5,765
  6,451
  7,176
  7,939
  8,524
  9,362
  10,237
  11,150
  12,100
  13,089
  14,117
  15,185
  16,296
  17,449
  18,648
  19,895
  21,192
  22,540
  23,944
  25,406
  26,929
  28,517
  30,173
  31,900
Operating income, $m
  385
  514
  652
  803
  969
  1,148
  1,340
  1,545
  1,763
  1,993
  2,236
  2,706
  2,972
  3,250
  3,540
  3,842
  4,155
  4,482
  4,821
  5,174
  5,540
  5,921
  6,316
  6,728
  7,156
  7,602
  8,066
  8,550
  9,054
  9,579
  10,128
EBITDA, $m
  488
  765
  909
  1,068
  1,241
  1,429
  1,630
  1,845
  2,073
  2,315
  2,568
  2,835
  3,114
  3,405
  3,708
  4,024
  4,353
  4,695
  5,050
  5,419
  5,803
  6,202
  6,616
  7,048
  7,496
  7,963
  8,449
  8,956
  9,484
  10,034
  10,609
Interest expense (income), $m
  25
  46
  59
  74
  90
  108
  127
  148
  170
  193
  218
  244
  271
  300
  330
  361
  393
  427
  462
  499
  537
  576
  617
  659
  704
  750
  798
  847
  899
  954
  1,010
Earnings before tax, $m
  353
  468
  593
  729
  879
  1,040
  1,213
  1,397
  1,593
  1,800
  2,017
  2,462
  2,701
  2,950
  3,210
  3,481
  3,762
  4,055
  4,359
  4,675
  5,003
  5,345
  5,699
  6,069
  6,453
  6,852
  7,268
  7,702
  8,154
  8,626
  9,118
Tax expense, $m
  136
  126
  160
  197
  237
  281
  327
  377
  430
  486
  545
  665
  729
  797
  867
  940
  1,016
  1,095
  1,177
  1,262
  1,351
  1,443
  1,539
  1,639
  1,742
  1,850
  1,962
  2,080
  2,202
  2,329
  2,462
Net income, $m
  209
  342
  433
  532
  641
  759
  885
  1,020
  1,163
  1,314
  1,473
  1,797
  1,972
  2,154
  2,343
  2,541
  2,746
  2,960
  3,182
  3,413
  3,652
  3,902
  4,161
  4,430
  4,710
  5,002
  5,306
  5,623
  5,953
  6,297
  6,656

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  81
  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
  3,373
  3,961
  4,709
  5,531
  6,429
  7,400
  8,443
  9,556
  10,737
  11,986
  13,301
  14,680
  16,123
  17,631
  19,202
  20,839
  22,542
  24,312
  26,152
  28,064
  30,051
  32,116
  34,263
  36,496
  38,819
  41,237
  43,755
  46,378
  49,112
  51,963
  54,938
Adjusted assets (=assets-cash), $m
  3,292
  3,961
  4,709
  5,531
  6,429
  7,400
  8,443
  9,556
  10,737
  11,986
  13,301
  14,680
  16,123
  17,631
  19,202
  20,839
  22,542
  24,312
  26,152
  28,064
  30,051
  32,116
  34,263
  36,496
  38,819
  41,237
  43,755
  46,378
  49,112
  51,963
  54,938
Revenue / Adjusted assets
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
  0.765
Average production assets, $m
  716
  861
  1,023
  1,202
  1,397
  1,608
  1,834
  2,076
  2,333
  2,604
  2,890
  3,189
  3,503
  3,830
  4,172
  4,527
  4,897
  5,282
  5,682
  6,097
  6,529
  6,978
  7,444
  7,929
  8,434
  8,959
  9,506
  10,076
  10,670
  11,290
  11,936
Working capital, $m
  -16
  -70
  -83
  -97
  -113
  -130
  -149
  -168
  -189
  -211
  -234
  -258
  -284
  -310
  -338
  -367
  -397
  -428
  -460
  -494
  -529
  -565
  -603
  -642
  -683
  -726
  -770
  -816
  -864
  -914
  -967
Total debt, $m
  1,348
  1,688
  2,111
  2,577
  3,085
  3,634
  4,225
  4,855
  5,523
  6,230
  6,974
  7,755
  8,572
  9,425
  10,315
  11,241
  12,205
  13,207
  14,248
  15,330
  16,455
  17,624
  18,839
  20,103
  21,418
  22,786
  24,211
  25,696
  27,243
  28,857
  30,541
Total liabilities, $m
  1,902
  2,242
  2,665
  3,131
  3,639
  4,188
  4,779
  5,409
  6,077
  6,784
  7,528
  8,309
  9,126
  9,979
  10,869
  11,795
  12,759
  13,761
  14,802
  15,884
  17,009
  18,178
  19,393
  20,657
  21,972
  23,340
  24,765
  26,250
  27,797
  29,411
  31,095
Total equity, $m
  1,471
  1,719
  2,043
  2,401
  2,790
  3,212
  3,664
  4,147
  4,660
  5,202
  5,772
  6,371
  6,997
  7,652
  8,334
  9,044
  9,783
  10,551
  11,350
  12,180
  13,042
  13,938
  14,870
  15,839
  16,847
  17,897
  18,989
  20,128
  21,315
  22,552
  23,843
Total liabilities and equity, $m
  3,373
  3,961
  4,708
  5,532
  6,429
  7,400
  8,443
  9,556
  10,737
  11,986
  13,300
  14,680
  16,123
  17,631
  19,203
  20,839
  22,542
  24,312
  26,152
  28,064
  30,051
  32,116
  34,263
  36,496
  38,819
  41,237
  43,754
  46,378
  49,112
  51,963
  54,938
Debt-to-equity ratio
  0.916
  0.980
  1.030
  1.070
  1.110
  1.130
  1.150
  1.170
  1.190
  1.200
  1.210
  1.220
  1.220
  1.230
  1.240
  1.240
  1.250
  1.250
  1.260
  1.260
  1.260
  1.260
  1.270
  1.270
  1.270
  1.270
  1.270
  1.280
  1.280
  1.280
  1.280
Adjusted equity ratio
  0.422
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  209
  342
  433
  532
  641
  759
  885
  1,020
  1,163
  1,314
  1,473
  1,797
  1,972
  2,154
  2,343
  2,541
  2,746
  2,960
  3,182
  3,413
  3,652
  3,902
  4,161
  4,430
  4,710
  5,002
  5,306
  5,623
  5,953
  6,297
  6,656
Depreciation, amort., depletion, $m
  103
  251
  258
  265
  273
  281
  290
  300
  310
  321
  333
  129
  141
  154
  168
  183
  197
  213
  229
  246
  263
  281
  300
  320
  340
  361
  383
  406
  430
  455
  481
Funds from operations, $m
  413
  593
  690
  797
  914
  1,040
  1,176
  1,320
  1,473
  1,635
  1,806
  1,926
  2,113
  2,308
  2,512
  2,723
  2,944
  3,173
  3,411
  3,658
  3,916
  4,183
  4,461
  4,750
  5,050
  5,363
  5,689
  6,029
  6,383
  6,752
  7,137
Change in working capital, $m
  23
  -12
  -13
  -14
  -16
  -17
  -18
  -20
  -21
  -22
  -23
  -24
  -25
  -27
  -28
  -29
  -30
  -31
  -32
  -34
  -35
  -36
  -38
  -39
  -41
  -43
  -44
  -46
  -48
  -50
  -52
Cash from operations, $m
  390
  716
  703
  812
  930
  1,057
  1,194
  1,340
  1,494
  1,657
  1,829
  1,950
  2,138
  2,335
  2,539
  2,752
  2,974
  3,204
  3,443
  3,692
  3,951
  4,219
  4,499
  4,789
  5,091
  5,406
  5,734
  6,075
  6,431
  6,802
  7,190
Maintenance CAPEX, $m
  0
  -29
  -35
  -41
  -48
  -56
  -65
  -74
  -84
  -94
  -105
  -117
  -129
  -141
  -154
  -168
  -183
  -197
  -213
  -229
  -246
  -263
  -281
  -300
  -320
  -340
  -361
  -383
  -406
  -430
  -455
New CAPEX, $m
  -123
  -145
  -162
  -179
  -195
  -211
  -227
  -242
  -257
  -271
  -286
  -300
  -314
  -328
  -341
  -356
  -370
  -385
  -400
  -415
  -432
  -449
  -466
  -485
  -505
  -525
  -547
  -570
  -594
  -619
  -646
Cash from investing activities, $m
  -828
  -174
  -197
  -220
  -243
  -267
  -292
  -316
  -341
  -365
  -391
  -417
  -443
  -469
  -495
  -524
  -553
  -582
  -613
  -644
  -678
  -712
  -747
  -785
  -825
  -865
  -908
  -953
  -1,000
  -1,049
  -1,101
Free cash flow, $m
  -438
  542
  506
  592
  686
  790
  903
  1,024
  1,154
  1,292
  1,438
  1,534
  1,696
  1,866
  2,043
  2,228
  2,421
  2,622
  2,831
  3,048
  3,273
  3,507
  3,751
  4,004
  4,267
  4,541
  4,825
  5,122
  5,431
  5,752
  6,088
Issuance/(repayment) of debt, $m
  440
  378
  423
  466
  508
  550
  590
  630
  669
  707
  744
  781
  817
  853
  890
  926
  964
  1,002
  1,041
  1,082
  1,125
  1,169
  1,215
  1,264
  1,315
  1,368
  1,425
  1,485
  1,548
  1,614
  1,684
Issuance/(repurchase) of shares, $m
  -13
  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  
  421
  378
  423
  466
  508
  550
  590
  630
  669
  707
  744
  781
  817
  853
  890
  926
  964
  1,002
  1,041
  1,082
  1,125
  1,169
  1,215
  1,264
  1,315
  1,368
  1,425
  1,485
  1,548
  1,614
  1,684
Total cash flow (excl. dividends), $m
  -17
  920
  929
  1,057
  1,194
  1,340
  1,493
  1,654
  1,823
  1,999
  2,182
  2,315
  2,513
  2,719
  2,933
  3,155
  3,385
  3,624
  3,872
  4,130
  4,398
  4,676
  4,966
  5,268
  5,582
  5,909
  6,250
  6,606
  6,978
  7,366
  7,772
Retained Cash Flow (-), $m
  -226
  -291
  -324
  -357
  -390
  -421
  -453
  -483
  -513
  -542
  -570
  -599
  -626
  -654
  -682
  -710
  -739
  -768
  -799
  -830
  -862
  -896
  -932
  -969
  -1,008
  -1,049
  -1,093
  -1,138
  -1,187
  -1,238
  -1,291
Prev. year cash balance distribution, $m
 
  43
  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
 
  672
  605
  700
  805
  918
  1,040
  1,171
  1,310
  1,457
  1,612
  1,716
  1,887
  2,065
  2,251
  2,444
  2,646
  2,856
  3,074
  3,300
  3,535
  3,780
  4,034
  4,299
  4,574
  4,860
  5,158
  5,468
  5,792
  6,129
  6,481
Discount rate, %
 
  6.90
  7.25
  7.61
  7.99
  8.39
  8.81
  9.25
  9.71
  10.19
  10.70
  11.24
  11.80
  12.39
  13.01
  13.66
  14.34
  15.06
  15.81
  16.61
  17.44
  18.31
  19.22
  20.18
  21.19
  22.25
  23.37
  24.53
  25.76
  27.05
  28.40
PV of cash for distribution, $m
 
  629
  526
  562
  592
  614
  627
  630
  624
  608
  583
  532
  495
  452
  406
  358
  310
  263
  219
  178
  142
  111
  84
  63
  45
  32
  22
  15
  9
  6
  4
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

VCA Inc. operates as an animal healthcare company in the United States and Canada. It operates in two segments, Animal Hospital and Laboratory. The Animal Hospital segment offers general medical and surgical services for companion animals, as well as specialized treatments comprising diagnostic, internal medicine, oncology, neurology, endocrinology, ophthalmology, dermatology, and cardiology services; and sells related retail and pharmaceutical products. It also provides specialty pet products, including pet food, vitamins, therapeutic shampoos and conditioners, flea collars and sprays, and other accessory products; and additional services, such as grooming, bathing, and boarding services. In addition, this segment performs various pet wellness programs, such as health examinations, diagnostic testing, routine vaccinations, spaying, neutering, and dental care. As of December 31, 2015, it operated or managed 682 animal hospitals. The Laboratory segment offers testing and consulting services used by veterinarians in the detection, diagnosis, evaluation, monitoring, treatment, and prevention of diseases and other conditions affecting animals. This segment serves animal hospitals, animal practices, universities, and other government organizations. It operated a network of 60 laboratories. VCA Inc. also sells digital radiography and ultrasound imaging equipment, related computer hardware, software, and ancillary services to the veterinary market, as well as provides education and training, consulting, and mobile imaging services; and franchises pet services, including dog day care, overnight boarding, grooming, and other ancillary services at pet care facilities. The company was formerly known as VCA Antech, Inc. and changed its name to VCA Inc. in June 2014. VCA Inc. was founded in 1986 and is headquartered in Los Angeles, California.

FINANCIAL RATIOS  of  VCA (WOOF)

Valuation Ratios
P/E Ratio 35.6
Price to Sales 3
Price to Book 5.1
Price to Tangible Book
Price to Cash Flow 19.1
Price to Free Cash Flow 27.9
Growth Rates
Sales Growth Rate 17.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 29.5%
Cap. Spend. - 3 Yr. Gr. Rate 11%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 89.1%
Total Debt to Equity 91.6%
Interest Coverage 15
Management Effectiveness
Return On Assets 7.6%
Ret/ On Assets - 3 Yr. Avg. 7.8%
Return On Total Capital 8.5%
Ret/ On T. Cap. - 3 Yr. Avg. 8.5%
Return On Equity 15.4%
Return On Equity - 3 Yr. Avg. 14.5%
Asset Turnover 0.9
Profitability Ratios
Gross Margin 23.5%
Gross Margin - 3 Yr. Avg. 23.5%
EBITDA Margin 19.1%
EBITDA Margin - 3 Yr. Avg. 19%
Operating Margin 15.3%
Oper. Margin - 3 Yr. Avg. 14.5%
Pre-Tax Margin 14%
Pre-Tax Margin - 3 Yr. Avg. 14.1%
Net Profit Margin 8.3%
Net Profit Margin - 3 Yr. Avg. 8.4%
Effective Tax Rate 38.5%
Eff/ Tax Rate - 3 Yr. Avg. 38.4%
Payout Ratio 0%

WOOF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the WOOF stock intrinsic value calculation we used $2517 million for the last fiscal year's total revenue generated by VCA. The default revenue input number comes from 2016 income statement of VCA. 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 WOOF stock valuation model: a) initial revenue growth rate of 20.4% 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 6.9%, whose default value for WOOF is calculated based on our internal credit rating of VCA, 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 VCA.
    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 WOOF stock the variable cost ratio is equal to 84.5%.

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 WOOF 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 VCA.

Corporate tax rate of 27% is the nominal tax rate for VCA. 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 WOOF 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 WOOF are equal to 28.4%.

Life of production assets of 24.8 years is the average useful life of capital assets used in VCA 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 WOOF is equal to -2.3%. 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 - $1471 million for VCA - 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 81.311 million for VCA 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 VCA at the current share price and the inputted number of shares is $7.5 billion.


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COMPANY NEWS

▶ VCA Inc. Reports Fourth Quarter 2016 Results   [08:00AM  GlobeNewswire]
▶ [$$] Mars makes $9.1bn bet on growing US pet market   [01:23PM  at Financial Times]
▶ Why VCA Inc Stock Popped Today   [12:08PM  at Motley Fool]
▶ Mars Shifts Its Orbit   [11:57AM  at Bloomberg]
▶ Mars, Incorporated to Acquire VCA Inc.   [08:00AM  PR Newswire]
▶ VCA Inc. to Report Fourth Quarter 2016 Financial Results   [Jan-05-17 06:26PM  GlobeNewswire]
▶ Is VCA Inc (WOOF) A Good Stock To Buy?   [Nov-29-16 04:38AM  at Insider Monkey]
▶ NAVTA and VCA Announce 2017 Membership   [Nov-04-16 08:00AM  Business Wire]
▶ VCA Inc. to Present at Stifel 2016 Healthcare Conference   [Oct-24-16 02:15PM  GlobeNewswire]
Stock chart of WOOF Financial statements of WOOF
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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