Intrinsic value of WestRock - WRK

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$57.31

  Intrinsic Value

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  Value-price divergence*

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$57.31

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

We calculate the intrinsic value of WRK 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 14.4

 

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, %
  27.39
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  14,172
  14,455
  14,788
  15,168
  15,595
  16,067
  16,586
  17,151
  17,762
  18,421
  19,128
  19,885
  20,692
  21,551
  22,464
  23,433
  24,460
  25,547
  26,696
  27,911
  29,194
  30,547
  31,974
  33,478
  35,063
  36,732
  38,490
  40,340
  42,286
  44,334
  46,488
Variable operating expenses, $m
 
  13,347
  13,643
  13,982
  14,361
  14,782
  15,244
  15,747
  16,291
  16,878
  17,507
  17,703
  18,421
  19,186
  19,999
  20,862
  21,776
  22,744
  23,768
  24,849
  25,991
  27,195
  28,466
  29,805
  31,216
  32,702
  34,267
  35,914
  37,647
  39,470
  41,388
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
  13,739
  13,347
  13,643
  13,982
  14,361
  14,782
  15,244
  15,747
  16,291
  16,878
  17,507
  17,703
  18,421
  19,186
  19,999
  20,862
  21,776
  22,744
  23,768
  24,849
  25,991
  27,195
  28,466
  29,805
  31,216
  32,702
  34,267
  35,914
  37,647
  39,470
  41,388
Operating income, $m
  433
  1,108
  1,145
  1,186
  1,233
  1,285
  1,342
  1,404
  1,471
  1,543
  1,621
  2,182
  2,270
  2,364
  2,465
  2,571
  2,684
  2,803
  2,929
  3,062
  3,203
  3,351
  3,508
  3,673
  3,847
  4,030
  4,223
  4,426
  4,639
  4,864
  5,100
EBITDA, $m
  1,580
  2,424
  2,480
  2,544
  2,615
  2,695
  2,782
  2,876
  2,979
  3,090
  3,208
  3,335
  3,470
  3,614
  3,768
  3,930
  4,102
  4,285
  4,477
  4,681
  4,896
  5,123
  5,362
  5,615
  5,881
  6,161
  6,455
  6,766
  7,092
  7,435
  7,797
Interest expense (income), $m
  230
  220
  230
  242
  256
  272
  289
  308
  329
  352
  376
  402
  430
  459
  491
  524
  560
  598
  638
  680
  724
  772
  821
  874
  929
  987
  1,048
  1,113
  1,181
  1,252
  1,328
Earnings before tax, $m
  245
  888
  914
  944
  977
  1,013
  1,053
  1,095
  1,142
  1,192
  1,245
  1,780
  1,841
  1,905
  1,974
  2,047
  2,124
  2,205
  2,291
  2,382
  2,479
  2,580
  2,687
  2,799
  2,918
  3,043
  3,174
  3,313
  3,458
  3,612
  3,773
Tax expense, $m
  90
  240
  247
  255
  264
  274
  284
  296
  308
  322
  336
  481
  497
  514
  533
  553
  573
  595
  619
  643
  669
  697
  725
  756
  788
  822
  857
  894
  934
  975
  1,019
Net income, $m
  -396
  648
  668
  689
  713
  740
  768
  800
  834
  870
  909
  1,299
  1,344
  1,391
  1,441
  1,494
  1,550
  1,610
  1,673
  1,739
  1,809
  1,883
  1,961
  2,044
  2,130
  2,221
  2,317
  2,418
  2,525
  2,637
  2,754

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  341
  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
  23,038
  23,166
  23,699
  24,308
  24,991
  25,749
  26,580
  27,486
  28,466
  29,521
  30,654
  31,866
  33,160
  34,537
  36,000
  37,553
  39,199
  40,941
  42,783
  44,729
  46,785
  48,953
  51,240
  53,651
  56,191
  58,866
  61,682
  64,647
  67,766
  71,048
  74,500
Adjusted assets (=assets-cash), $m
  22,697
  23,166
  23,699
  24,308
  24,991
  25,749
  26,580
  27,486
  28,466
  29,521
  30,654
  31,866
  33,160
  34,537
  36,000
  37,553
  39,199
  40,941
  42,783
  44,729
  46,785
  48,953
  51,240
  53,651
  56,191
  58,866
  61,682
  64,647
  67,766
  71,048
  74,500
Revenue / Adjusted assets
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
  0.624
Average production assets, $m
  11,924
  12,157
  12,437
  12,756
  13,115
  13,513
  13,949
  14,424
  14,938
  15,492
  16,087
  16,723
  17,402
  18,124
  18,892
  19,707
  20,571
  21,485
  22,452
  23,473
  24,552
  25,690
  26,890
  28,155
  29,488
  30,892
  32,370
  33,926
  35,563
  37,285
  39,097
Working capital, $m
  1,730
  1,720
  1,760
  1,805
  1,856
  1,912
  1,974
  2,041
  2,114
  2,192
  2,276
  2,366
  2,462
  2,565
  2,673
  2,789
  2,911
  3,040
  3,177
  3,321
  3,474
  3,635
  3,805
  3,984
  4,172
  4,371
  4,580
  4,800
  5,032
  5,276
  5,532
Total debt, $m
  5,789
  5,754
  6,059
  6,408
  6,800
  7,234
  7,711
  8,229
  8,791
  9,396
  10,045
  10,739
  11,480
  12,269
  13,108
  13,998
  14,941
  15,939
  16,995
  18,110
  19,288
  20,530
  21,841
  23,222
  24,677
  26,210
  27,824
  29,523
  31,310
  33,191
  35,169
Total liabilities, $m
  13,309
  13,274
  13,579
  13,928
  14,320
  14,754
  15,231
  15,749
  16,311
  16,916
  17,565
  18,259
  19,000
  19,789
  20,628
  21,518
  22,461
  23,459
  24,515
  25,630
  26,808
  28,050
  29,361
  30,742
  32,197
  33,730
  35,344
  37,043
  38,830
  40,711
  42,689
Total equity, $m
  9,729
  9,892
  10,119
  10,379
  10,671
  10,995
  11,350
  11,736
  12,155
  12,606
  13,089
  13,607
  14,159
  14,747
  15,372
  16,035
  16,738
  17,482
  18,268
  19,099
  19,977
  20,903
  21,880
  22,909
  23,993
  25,136
  26,338
  27,604
  28,936
  30,338
  31,812
Total liabilities and equity, $m
  23,038
  23,166
  23,698
  24,307
  24,991
  25,749
  26,581
  27,485
  28,466
  29,522
  30,654
  31,866
  33,159
  34,536
  36,000
  37,553
  39,199
  40,941
  42,783
  44,729
  46,785
  48,953
  51,241
  53,651
  56,190
  58,866
  61,682
  64,647
  67,766
  71,049
  74,501
Debt-to-equity ratio
  0.595
  0.580
  0.600
  0.620
  0.640
  0.660
  0.680
  0.700
  0.720
  0.750
  0.770
  0.790
  0.810
  0.830
  0.850
  0.870
  0.890
  0.910
  0.930
  0.950
  0.970
  0.980
  1.000
  1.010
  1.030
  1.040
  1.060
  1.070
  1.080
  1.090
  1.110
Adjusted equity ratio
  0.414
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427
  0.427

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -396
  648
  668
  689
  713
  740
  768
  800
  834
  870
  909
  1,299
  1,344
  1,391
  1,441
  1,494
  1,550
  1,610
  1,673
  1,739
  1,809
  1,883
  1,961
  2,044
  2,130
  2,221
  2,317
  2,418
  2,525
  2,637
  2,754
Depreciation, amort., depletion, $m
  1,147
  1,316
  1,335
  1,358
  1,382
  1,410
  1,440
  1,473
  1,508
  1,546
  1,587
  1,153
  1,200
  1,250
  1,303
  1,359
  1,419
  1,482
  1,548
  1,619
  1,693
  1,772
  1,854
  1,942
  2,034
  2,130
  2,232
  2,340
  2,453
  2,571
  2,696
Funds from operations, $m
  1,662
  1,965
  2,003
  2,047
  2,095
  2,149
  2,208
  2,272
  2,342
  2,416
  2,496
  2,453
  2,544
  2,641
  2,744
  2,853
  2,969
  3,092
  3,221
  3,358
  3,503
  3,655
  3,816
  3,985
  4,164
  4,352
  4,550
  4,758
  4,977
  5,208
  5,450
Change in working capital, $m
  -26
  34
  40
  45
  51
  56
  62
  67
  73
  78
  84
  90
  96
  102
  109
  115
  122
  129
  137
  145
  153
  161
  170
  179
  189
  199
  209
  220
  232
  244
  256
Cash from operations, $m
  1,688
  1,900
  1,964
  2,001
  2,045
  2,093
  2,146
  2,205
  2,269
  2,338
  2,412
  2,363
  2,448
  2,539
  2,635
  2,738
  2,847
  2,962
  3,084
  3,214
  3,350
  3,494
  3,646
  3,806
  3,975
  4,153
  4,341
  4,538
  4,746
  4,964
  5,194
Maintenance CAPEX, $m
  0
  -822
  -838
  -858
  -880
  -904
  -932
  -962
  -995
  -1,030
  -1,068
  -1,109
  -1,153
  -1,200
  -1,250
  -1,303
  -1,359
  -1,419
  -1,482
  -1,548
  -1,619
  -1,693
  -1,772
  -1,854
  -1,942
  -2,034
  -2,130
  -2,232
  -2,340
  -2,453
  -2,571
New CAPEX, $m
  -797
  -233
  -280
  -320
  -359
  -398
  -436
  -475
  -514
  -554
  -595
  -636
  -679
  -723
  -768
  -815
  -864
  -914
  -967
  -1,021
  -1,079
  -1,138
  -1,200
  -1,265
  -1,333
  -1,404
  -1,478
  -1,556
  -1,637
  -1,722
  -1,812
Cash from investing activities, $m
  -1,351
  -1,055
  -1,118
  -1,178
  -1,239
  -1,302
  -1,368
  -1,437
  -1,509
  -1,584
  -1,663
  -1,745
  -1,832
  -1,923
  -2,018
  -2,118
  -2,223
  -2,333
  -2,449
  -2,569
  -2,698
  -2,831
  -2,972
  -3,119
  -3,275
  -3,438
  -3,608
  -3,788
  -3,977
  -4,175
  -4,383
Free cash flow, $m
  337
  845
  845
  824
  806
  791
  778
  768
  760
  754
  749
  617
  616
  616
  617
  620
  624
  629
  636
  644
  653
  663
  674
  687
  701
  716
  732
  750
  769
  789
  811
Issuance/(repayment) of debt, $m
  439
  258
  305
  349
  392
  434
  476
  519
  561
  605
  649
  695
  741
  789
  839
  890
  943
  998
  1,056
  1,115
  1,178
  1,243
  1,310
  1,381
  1,455
  1,533
  1,614
  1,699
  1,788
  1,881
  1,978
Issuance/(repurchase) of shares, $m
  -324
  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  
  150
  258
  305
  349
  392
  434
  476
  519
  561
  605
  649
  695
  741
  789
  839
  890
  943
  998
  1,056
  1,115
  1,178
  1,243
  1,310
  1,381
  1,455
  1,533
  1,614
  1,699
  1,788
  1,881
  1,978
Total cash flow (excl. dividends), $m
  494
  1,103
  1,151
  1,173
  1,198
  1,225
  1,255
  1,287
  1,321
  1,358
  1,398
  1,312
  1,357
  1,405
  1,456
  1,510
  1,567
  1,628
  1,691
  1,759
  1,830
  1,905
  1,985
  2,068
  2,156
  2,249
  2,346
  2,448
  2,556
  2,670
  2,789
Retained Cash Flow (-), $m
  1,923
  -211
  -228
  -260
  -292
  -324
  -355
  -387
  -418
  -451
  -484
  -518
  -552
  -588
  -625
  -663
  -703
  -744
  -787
  -831
  -878
  -926
  -977
  -1,029
  -1,085
  -1,142
  -1,203
  -1,266
  -1,332
  -1,401
  -1,474
Prev. year cash balance distribution, $m
 
  48
  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
 
  940
  923
  913
  906
  901
  900
  900
  903
  908
  914
  794
  805
  817
  831
  847
  864
  884
  905
  928
  953
  979
  1,008
  1,039
  1,071
  1,106
  1,143
  1,183
  1,224
  1,268
  1,315
Discount rate, %
 
  6.10
  6.41
  6.73
  7.06
  7.41
  7.79
  8.17
  8.58
  9.01
  9.46
  9.94
  10.43
  10.95
  11.50
  12.08
  12.68
  13.32
  13.98
  14.68
  15.41
  16.19
  16.99
  17.84
  18.74
  19.67
  20.66
  21.69
  22.77
  23.91
  25.11
PV of cash for distribution, $m
 
  886
  815
  751
  689
  630
  574
  519
  467
  417
  370
  280
  245
  211
  181
  153
  128
  106
  86
  69
  54
  42
  32
  24
  17
  12
  9
  6
  4
  3
  2
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

WestRock Company manufactures and sells paper and packaging solutions for the consumer and corrugated markets in North America, South America, Europe, and Asia. The company operates through Corrugated Packaging, Consumer Packaging, and Land and Development segments. The Corrugated Packaging segment produces containerboards, corrugated sheets, corrugated packaging, and preprinted linerboards for consumer and industrial products manufacturers, and corrugated box manufacturers; and recycled fiber. This segment also provides structural and graphic design, engineering services, and automated packaging machines; resells aluminum and plastics; and offers waste services. Its corrugated packaging products are used to provide protective packaging for the shipment and distribution of food, paper, health and beauty, other household, consumer, commercial, and industrial products. The Consumer Packaging segment manufactures and sells folding and beverage cartons, displays, dispensing, and interior partitions; paperboards; recycled paperboards; express mail envelopes for the overnight courier industry; and secondary packages and paperboard packaging for the healthcare market. This segment also manufactures and sells solid fiber and corrugated partitions and die-cut paperboard components; temporary and permanent point-of-purchase displays for the consumer products and retail markets; dispensing systems, such as pumps; lithographic laminated packaging products; flip-top and applicator closures; plastic packaging products; trigger sprayers; aerosol actuators; hose-end sprayers; spouted and applicator closures; and sprayers for nasal and throat applications, as well as provides contract packing services. The company’s Land and Development segment engages in real estate development activities. WestRock Company is based in Richmond, Virginia.

FINANCIAL RATIOS  of  WestRock (WRK)

Valuation Ratios
P/E Ratio -36.3
Price to Sales 1
Price to Book 1.5
Price to Tangible Book
Price to Cash Flow 8.5
Price to Free Cash Flow 16.1
Growth Rates
Sales Growth Rate 27.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 36%
Cap. Spend. - 3 Yr. Gr. Rate 12.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.2
LT Debt to Equity 56.5%
Total Debt to Equity 59.5%
Interest Coverage 2
Management Effectiveness
Return On Assets -1%
Ret/ On Assets - 3 Yr. Avg. 2.4%
Return On Total Capital -2.4%
Ret/ On T. Cap. - 3 Yr. Avg. 2.8%
Return On Equity -3.7%
Return On Equity - 3 Yr. Avg. 4.6%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 19.5%
Gross Margin - 3 Yr. Avg. 19.4%
EBITDA Margin 11.4%
EBITDA Margin - 3 Yr. Avg. 13.5%
Operating Margin 3.1%
Oper. Margin - 3 Yr. Avg. 6.4%
Pre-Tax Margin 1.7%
Pre-Tax Margin - 3 Yr. Avg. 5.4%
Net Profit Margin -2.8%
Net Profit Margin - 3 Yr. Avg. 2.2%
Effective Tax Rate 36.7%
Eff/ Tax Rate - 3 Yr. Avg. 35.2%
Payout Ratio -96.2%

WRK stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the WRK stock intrinsic value calculation we used $14172 million for the last fiscal year's total revenue generated by WestRock. The default revenue input number comes from 2016 income statement of WestRock. 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 WRK stock valuation model: a) initial revenue growth rate of 2% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 6.1%, whose default value for WRK is calculated based on our internal credit rating of WestRock, 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 WestRock.
    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 WRK stock the variable cost ratio is equal to 92.4%.

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 WRK 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 4% for WestRock.

Corporate tax rate of 27% is the nominal tax rate for WestRock. 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 WRK 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 WRK are equal to 84.1%.

Life of production assets of 14.5 years is the average useful life of capital assets used in WestRock 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 WRK is equal to 11.9%. 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 - $9729 million for WestRock - 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 250.55 million for WestRock 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 WestRock at the current share price and the inputted number of shares is $14.4 billion.


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COMPANY NEWS

▶ WestRock Completes Acquisition of Multi Packaging Solutions   [Jun-06-17 10:31AM  GlobeNewswire]
▶ Intuit Was the S&P 500s Top Gainer on May 24   [May-26-17 09:07AM  Market Realist]
▶ Washington County box plant to be acquired   [May-24-17 04:55PM  American City Business Journals]
▶ Which Stocks Are Showing Rising Relative Strength?   [May-23-17 11:15AM  Investor's Business Daily]
▶ 2015 IPO With Triple-Digit EPS Growth Trying To Package New Run   [May-22-17 11:59AM  Investor's Business Daily]
▶ ETFs with exposure to WestRock Co. : May 19, 2017   [May-19-17 02:15PM  Capital Cube]
▶ Which Direction Does WestRock Go From Here?   [May-09-17 01:09PM  TheStreet.com]
▶ WestRock tops Street 2Q forecasts   [06:48AM  Associated Press]
▶ WestRock Co. Value Analysis (NYSE:WRK) : April 21, 2017   [Apr-21-17 03:57PM  Capital Cube]
▶ WestRock Announces Quarterly Dividend of $0.40 Per Share   [Apr-20-17 05:22PM  GlobeNewswire]
▶ WestRock Is a Hot Stock to Buy Now   [Mar-27-17 01:50PM  TheStreet.com]
▶ WestRock Named to Fortunes Worlds Most Admired Company List   [Feb-16-17 12:08PM  GlobeNewswire]
▶ WestRock Announces Quarterly Dividend of $0.40 Per Share   [Jan-27-17 12:08PM  GlobeNewswire]
▶ [$$] WestRock Sells Closure-and-Dispensing Business to Silgan   [10:51AM  at The Wall Street Journal]
▶ The Top 15 Spin-Offs Of 2016   [Jan-05-17 03:48PM  at Forbes]
Stock chart of WRK Financial statements of WRK Annual reports of WRK
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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