Intrinsic value of Alimera Sciences, Inc. - ALIM

Previous Close

$0.50

  Intrinsic Value

$11.52

stock screener

  Rating & Target

str. buy

+999%

Previous close

$0.50

 
Intrinsic value

$11.52

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of ALIM 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 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.0

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  75
  116
  174
  252
  356
  489
  656
  862
  1,109
  1,401
  1,739
  2,127
  2,563
  3,050
  3,586
  4,171
  4,805
  5,486
  6,213
  6,986
  7,802
  8,662
  9,564
  10,508
  11,495
  12,523
  13,594
  14,709
  15,868
  17,072
Variable operating expenses, $m
  29
  44
  66
  96
  136
  186
  250
  328
  422
  534
  662
  810
  976
  1,162
  1,366
  1,589
  1,830
  2,089
  2,366
  2,661
  2,972
  3,299
  3,643
  4,002
  4,378
  4,770
  5,178
  5,602
  6,044
  6,502
Fixed operating expenses, $m
  40
  41
  42
  43
  43
  44
  45
  46
  47
  48
  50
  51
  52
  53
  54
  55
  56
  58
  59
  60
  62
  63
  64
  66
  67
  69
  70
  72
  73
  75
Total operating expenses, $m
  69
  85
  108
  139
  179
  230
  295
  374
  469
  582
  712
  861
  1,028
  1,215
  1,420
  1,644
  1,886
  2,147
  2,425
  2,721
  3,034
  3,362
  3,707
  4,068
  4,445
  4,839
  5,248
  5,674
  6,117
  6,577
Operating income, $m
  7
  31
  66
  113
  177
  258
  361
  487
  639
  819
  1,027
  1,266
  1,535
  1,835
  2,166
  2,527
  2,918
  3,339
  3,788
  4,265
  4,769
  5,300
  5,857
  6,440
  7,049
  7,685
  8,346
  9,035
  9,751
  10,495
EBITDA, $m
  9
  35
  71
  121
  188
  273
  381
  513
  673
  861
  1,080
  1,330
  1,613
  1,928
  2,275
  2,654
  3,064
  3,505
  3,976
  4,476
  5,005
  5,562
  6,146
  6,758
  7,397
  8,064
  8,758
  9,480
  10,231
  11,012
Interest expense (income), $m
  4
  5
  8
  13
  21
  31
  44
  61
  82
  109
  140
  178
  221
  271
  326
  389
  457
  532
  613
  701
  794
  893
  997
  1,107
  1,223
  1,344
  1,470
  1,601
  1,739
  1,881
  2,030
Earnings before tax, $m
  2
  23
  53
  93
  146
  214
  300
  405
  530
  678
  850
  1,045
  1,265
  1,509
  1,777
  2,070
  2,386
  2,725
  3,087
  3,471
  3,876
  4,303
  4,750
  5,217
  5,706
  6,215
  6,745
  7,296
  7,870
  8,465
Tax expense, $m
  0
  6
  14
  25
  39
  58
  81
  109
  143
  183
  229
  282
  341
  407
  480
  559
  644
  736
  834
  937
  1,047
  1,162
  1,282
  1,409
  1,541
  1,678
  1,821
  1,970
  2,125
  2,286
Net income, $m
  1
  17
  38
  68
  107
  156
  219
  295
  387
  495
  620
  763
  923
  1,101
  1,297
  1,511
  1,742
  1,990
  2,254
  2,534
  2,830
  3,141
  3,467
  3,809
  4,165
  4,537
  4,924
  5,326
  5,745
  6,180

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $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 assets, $m
  82
  126
  189
  274
  386
  531
  713
  936
  1,204
  1,521
  1,889
  2,309
  2,783
  3,311
  3,894
  4,529
  5,217
  5,957
  6,746
  7,585
  8,471
  9,404
  10,384
  11,409
  12,480
  13,597
  14,760
  15,970
  17,229
  18,536
Adjusted assets (=assets-cash), $m
  82
  126
  189
  274
  386
  531
  713
  936
  1,204
  1,521
  1,889
  2,309
  2,783
  3,311
  3,894
  4,529
  5,217
  5,957
  6,746
  7,585
  8,471
  9,404
  10,384
  11,409
  12,480
  13,597
  14,760
  15,970
  17,229
  18,536
Revenue / Adjusted assets
  0.915
  0.921
  0.921
  0.920
  0.922
  0.921
  0.920
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
  0.921
Average production assets, $m
  16
  25
  38
  55
  78
  107
  143
  188
  242
  305
  379
  464
  559
  665
  782
  909
  1,048
  1,196
  1,354
  1,523
  1,701
  1,888
  2,085
  2,291
  2,506
  2,730
  2,964
  3,207
  3,459
  3,722
Working capital, $m
  19
  29
  44
  63
  89
  123
  165
  216
  278
  352
  437
  534
  643
  765
  900
  1,047
  1,206
  1,377
  1,560
  1,753
  1,958
  2,174
  2,400
  2,638
  2,885
  3,143
  3,412
  3,692
  3,983
  4,285
Total debt, $m
  61
  101
  157
  234
  335
  465
  629
  829
  1,071
  1,356
  1,687
  2,065
  2,492
  2,967
  3,491
  4,064
  4,683
  5,348
  6,059
  6,814
  7,611
  8,451
  9,333
  10,256
  11,220
  12,225
  13,272
  14,361
  15,493
  16,670
Total liabilities, $m
  73
  114
  170
  246
  348
  478
  641
  842
  1,084
  1,369
  1,700
  2,078
  2,505
  2,980
  3,504
  4,076
  4,695
  5,361
  6,072
  6,826
  7,624
  8,464
  9,346
  10,269
  11,232
  12,238
  13,284
  14,373
  15,506
  16,683
Total equity, $m
  8
  13
  19
  27
  39
  53
  71
  94
  120
  152
  189
  231
  278
  331
  389
  453
  522
  596
  675
  758
  847
  940
  1,038
  1,141
  1,248
  1,360
  1,476
  1,597
  1,723
  1,854
Total liabilities and equity, $m
  81
  127
  189
  273
  387
  531
  712
  936
  1,204
  1,521
  1,889
  2,309
  2,783
  3,311
  3,893
  4,529
  5,217
  5,957
  6,747
  7,584
  8,471
  9,404
  10,384
  11,410
  12,480
  13,598
  14,760
  15,970
  17,229
  18,537
Debt-to-equity ratio
  7.440
  7.990
  8.320
  8.530
  8.670
  8.760
  8.820
  8.860
  8.890
  8.920
  8.930
  8.940
  8.950
  8.960
  8.970
  8.970
  8.980
  8.980
  8.980
  8.980
  8.980
  8.990
  8.990
  8.990
  8.990
  8.990
  8.990
  8.990
  8.990
  8.990
Adjusted equity ratio
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1
  17
  38
  68
  107
  156
  219
  295
  387
  495
  620
  763
  923
  1,101
  1,297
  1,511
  1,742
  1,990
  2,254
  2,534
  2,830
  3,141
  3,467
  3,809
  4,165
  4,537
  4,924
  5,326
  5,745
  6,180
Depreciation, amort., depletion, $m
  2
  4
  5
  8
  11
  15
  20
  26
  34
  43
  53
  64
  78
  92
  109
  126
  145
  166
  188
  212
  236
  262
  290
  318
  348
  379
  412
  445
  480
  517
Funds from operations, $m
  4
  21
  44
  76
  117
  171
  239
  322
  421
  538
  673
  827
  1,001
  1,194
  1,406
  1,637
  1,887
  2,156
  2,442
  2,745
  3,066
  3,403
  3,757
  4,127
  4,513
  4,916
  5,335
  5,772
  6,225
  6,697
Change in working capital, $m
  7
  10
  14
  20
  26
  33
  42
  52
  62
  73
  85
  97
  110
  122
  135
  147
  159
  171
  183
  194
  205
  216
  226
  237
  248
  258
  269
  280
  291
  302
Cash from operations, $m
  -4
  10
  29
  56
  91
  138
  197
  270
  359
  464
  588
  730
  891
  1,072
  1,271
  1,490
  1,728
  1,985
  2,259
  2,551
  2,861
  3,187
  3,530
  3,890
  4,266
  4,658
  5,067
  5,492
  5,934
  6,394
Maintenance CAPEX, $m
  -1
  -2
  -4
  -5
  -8
  -11
  -15
  -20
  -26
  -34
  -42
  -53
  -64
  -78
  -92
  -109
  -126
  -145
  -166
  -188
  -212
  -236
  -262
  -290
  -318
  -348
  -379
  -412
  -445
  -480
New CAPEX, $m
  -6
  -9
  -13
  -17
  -23
  -29
  -36
  -45
  -54
  -64
  -74
  -84
  -95
  -106
  -117
  -128
  -138
  -148
  -159
  -168
  -178
  -187
  -197
  -206
  -215
  -224
  -234
  -243
  -253
  -263
Cash from investing activities, $m
  -7
  -11
  -17
  -22
  -31
  -40
  -51
  -65
  -80
  -98
  -116
  -137
  -159
  -184
  -209
  -237
  -264
  -293
  -325
  -356
  -390
  -423
  -459
  -496
  -533
  -572
  -613
  -655
  -698
  -743
Free cash flow, $m
  -11
  -1
  13
  34
  61
  98
  146
  205
  279
  367
  472
  593
  732
  888
  1,062
  1,254
  1,464
  1,691
  1,935
  2,195
  2,471
  2,764
  3,071
  3,394
  3,733
  4,086
  4,454
  4,837
  5,236
  5,651
Issuance/(repayment) of debt, $m
  22
  40
  56
  77
  101
  130
  164
  201
  242
  285
  331
  378
  427
  475
  524
  572
  619
  665
  711
  755
  798
  840
  882
  923
  964
  1,005
  1,047
  1,089
  1,132
  1,177
Issuance/(repurchase) of shares, $m
  7
  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  
  29
  40
  56
  77
  101
  130
  164
  201
  242
  285
  331
  378
  427
  475
  524
  572
  619
  665
  711
  755
  798
  840
  882
  923
  964
  1,005
  1,047
  1,089
  1,132
  1,177
Total cash flow (excl. dividends), $m
  18
  39
  70
  110
  162
  228
  309
  406
  520
  652
  803
  971
  1,158
  1,363
  1,586
  1,826
  2,083
  2,356
  2,645
  2,950
  3,269
  3,604
  3,953
  4,317
  4,696
  5,091
  5,501
  5,926
  6,369
  6,828
Retained Cash Flow (-), $m
  -8
  -4
  -6
  -9
  -11
  -14
  -18
  -22
  -27
  -32
  -37
  -42
  -47
  -53
  -58
  -64
  -69
  -74
  -79
  -84
  -89
  -93
  -98
  -103
  -107
  -112
  -116
  -121
  -126
  -131
Prev. year cash balance distribution, $m
  3
  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
  13
  35
  63
  102
  151
  214
  291
  384
  494
  621
  766
  929
  1,111
  1,311
  1,528
  1,763
  2,014
  2,282
  2,566
  2,866
  3,181
  3,510
  3,855
  4,215
  4,589
  4,979
  5,384
  5,805
  6,243
  6,697
Discount rate, %
  10.80
  11.34
  11.91
  12.50
  13.13
  13.78
  14.47
  15.20
  15.96
  16.75
  17.59
  18.47
  19.40
  20.37
  21.38
  22.45
  23.58
  24.75
  25.99
  27.29
  28.66
  30.09
  31.59
  33.17
  34.83
  36.57
  38.40
  40.32
  42.34
  44.45
PV of cash for distribution, $m
  12
  28
  45
  63
  82
  99
  113
  124
  130
  132
  129
  122
  111
  98
  84
  69
  55
  43
  32
  23
  16
  11
  7
  4
  3
  2
  1
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0
  50.0

Alimera Sciences, Inc. (Alimera) is a pharmaceutical company. The Company is engaged in the research, development and commercialization of prescription ophthalmic pharmaceuticals. The Company operates through two segments: U.S. and International. The Company focuses on diseases affecting the back of the eye or retina. The Company's product is ILUVIEN, which is developed to treat diabetic macular edema (DME). DME is a disease of the retina that affects individuals with diabetes and can lead to severe vision loss and blindness. In the United States, ILUVIEN is indicated for the treatment of DME in patients who have been treated with a course of corticosteroids and did not have a rise in intraocular pressure (IOP). In the European Economic Area (EEA) countries, ILUVIEN is indicated for the treatment of vision impairment associated with DME considered insufficiently responsive to available therapies.

FINANCIAL RATIOS  of  Alimera Sciences, Inc. (ALIM)

Valuation Ratios
P/E Ratio -1
Price to Sales 1
Price to Book 1.2
Price to Tangible Book
Price to Cash Flow -1.3
Price to Free Cash Flow -1.3
Growth Rates
Sales Growth Rate 54.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate -100%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 130.8%
Total Debt to Equity 130.8%
Interest Coverage -7
Management Effectiveness
Return On Assets -41.4%
Ret/ On Assets - 3 Yr. Avg. -42%
Return On Total Capital -55.5%
Ret/ On T. Cap. - 3 Yr. Avg. -62%
Return On Equity -126.9%
Return On Equity - 3 Yr. Avg. -122.8%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 94.1%
Gross Margin - 3 Yr. Avg. 92.4%
EBITDA Margin -76.5%
EBITDA Margin - 3 Yr. Avg. -203.5%
Operating Margin -91.2%
Oper. Margin - 3 Yr. Avg. -231.1%
Pre-Tax Margin -97.1%
Pre-Tax Margin - 3 Yr. Avg. -229.3%
Net Profit Margin -97.1%
Net Profit Margin - 3 Yr. Avg. -229.3%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ALIM stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ALIM stock intrinsic value calculation we used $47 million for the last fiscal year's total revenue generated by Alimera Sciences, Inc.. The default revenue input number comes from 0001 income statement of Alimera Sciences, Inc.. 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 ALIM stock valuation model: a) initial revenue growth rate of 60% 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 10.8%, whose default value for ALIM is calculated based on our internal credit rating of Alimera Sciences, Inc., 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 Alimera Sciences, Inc..
    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 ALIM stock the variable cost ratio is equal to 38.3%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $39 million in the base year in the intrinsic value calculation for ALIM 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 13.1% for Alimera Sciences, Inc..

Corporate tax rate of 27% is the nominal tax rate for Alimera Sciences, Inc.. 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 ALIM 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 ALIM are equal to 21.8%.

Life of production assets of 7.2 years is the average useful life of capital assets used in Alimera Sciences, Inc. 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 ALIM is equal to 25.1%. 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 - $2.722 million for Alimera Sciences, Inc. - 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 70.966 million for Alimera Sciences, Inc. 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 Alimera Sciences, Inc. at the current share price and the inputted number of shares is $0.0 billion.

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