Intrinsic value of Allison Transmission Holdings - ALSN

Previous Close

$47.83

  Intrinsic Value

$107.00

stock screener

  Rating & Target

str. buy

+124%

Previous close

$47.83

 
Intrinsic value

$107.00

 
Up/down potential

+124%

 
Rating

str. buy

We calculate the intrinsic value of ALSN 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 2017), $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 6.8

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   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
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  22.90
  21.11
  19.50
  18.05
  16.74
  15.57
  14.51
  13.56
  12.71
  11.93
  11.24
  10.62
  10.06
  9.55
  9.09
  8.69
  8.32
  7.99
  7.69
  7.42
  7.18
  6.96
  6.76
  6.59
  6.43
  6.29
  6.16
  6.04
  5.94
  5.84
Revenue, $m
  2,780
  3,367
  4,023
  4,750
  5,545
  6,408
  7,338
  8,333
  9,392
  10,513
  11,695
  12,936
  14,237
  15,597
  17,015
  18,493
  20,031
  21,631
  23,294
  25,022
  26,817
  28,683
  30,623
  32,640
  34,738
  36,921
  39,194
  41,562
  44,030
  46,602
Variable operating expenses, $m
  1,391
  1,620
  1,875
  2,158
  2,468
  2,804
  3,166
  3,553
  3,965
  4,401
  4,552
  5,035
  5,541
  6,071
  6,623
  7,198
  7,797
  8,419
  9,066
  9,739
  10,438
  11,164
  11,919
  12,704
  13,521
  14,370
  15,255
  16,177
  17,137
  18,138
Fixed operating expenses, $m
  438
  448
  458
  468
  478
  489
  500
  511
  522
  533
  545
  557
  569
  582
  595
  608
  621
  635
  649
  663
  678
  692
  708
  723
  739
  755
  772
  789
  806
  824
Total operating expenses, $m
  1,829
  2,068
  2,333
  2,626
  2,946
  3,293
  3,666
  4,064
  4,487
  4,934
  5,097
  5,592
  6,110
  6,653
  7,218
  7,806
  8,418
  9,054
  9,715
  10,402
  11,116
  11,856
  12,627
  13,427
  14,260
  15,125
  16,027
  16,966
  17,943
  18,962
Operating income, $m
  950
  1,299
  1,690
  2,124
  2,599
  3,116
  3,673
  4,270
  4,905
  5,578
  6,598
  7,344
  8,127
  8,945
  9,798
  10,688
  11,614
  12,577
  13,579
  14,620
  15,702
  16,827
  17,996
  19,213
  20,478
  21,795
  23,167
  24,596
  26,086
  27,640
EBITDA, $m
  1,701
  2,143
  2,639
  3,188
  3,789
  4,443
  5,148
  5,903
  6,707
  7,558
  8,456
  9,400
  10,389
  11,423
  12,502
  13,626
  14,797
  16,014
  17,280
  18,596
  19,963
  21,385
  22,862
  24,399
  25,998
  27,662
  29,395
  31,201
  33,082
  35,045
Interest expense (income), $m
  78
  137
  181
  230
  285
  346
  413
  485
  563
  647
  736
  830
  929
  1,033
  1,142
  1,256
  1,375
  1,499
  1,628
  1,763
  1,902
  2,047
  2,198
  2,354
  2,517
  2,686
  2,863
  3,046
  3,236
  3,435
  3,642
Earnings before tax, $m
  813
  1,118
  1,460
  1,838
  2,253
  2,703
  3,188
  3,706
  4,258
  4,843
  5,768
  6,415
  7,093
  7,802
  8,542
  9,312
  10,114
  10,949
  11,816
  12,718
  13,655
  14,629
  15,642
  16,695
  17,792
  18,933
  20,121
  21,360
  22,651
  23,998
Tax expense, $m
  219
  302
  394
  496
  608
  730
  861
  1,001
  1,150
  1,308
  1,557
  1,732
  1,915
  2,107
  2,306
  2,514
  2,731
  2,956
  3,190
  3,434
  3,687
  3,950
  4,223
  4,508
  4,804
  5,112
  5,433
  5,767
  6,116
  6,479
Net income, $m
  593
  816
  1,066
  1,342
  1,645
  1,973
  2,327
  2,706
  3,109
  3,535
  4,211
  4,683
  5,178
  5,696
  6,235
  6,798
  7,383
  7,992
  8,626
  9,284
  9,968
  10,679
  11,419
  12,188
  12,988
  13,821
  14,689
  15,593
  16,535
  17,518

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
  5,167
  6,258
  7,478
  8,828
  10,306
  11,911
  13,640
  15,489
  17,457
  19,541
  21,738
  24,045
  26,463
  28,991
  31,627
  34,374
  37,233
  40,206
  43,297
  46,508
  49,846
  53,315
  56,920
  60,669
  64,569
  68,627
  72,852
  77,253
  81,839
  86,621
Adjusted assets (=assets-cash), $m
  5,167
  6,258
  7,478
  8,828
  10,306
  11,911
  13,640
  15,489
  17,457
  19,541
  21,738
  24,045
  26,463
  28,991
  31,627
  34,374
  37,233
  40,206
  43,297
  46,508
  49,846
  53,315
  56,920
  60,669
  64,569
  68,627
  72,852
  77,253
  81,839
  86,621
Revenue / Adjusted assets
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
  0.538
Average production assets, $m
  4,417
  5,350
  6,393
  7,547
  8,811
  10,183
  11,660
  13,242
  14,924
  16,705
  18,583
  20,556
  22,623
  24,784
  27,038
  29,386
  31,830
  34,372
  37,014
  39,759
  42,612
  45,578
  48,660
  51,865
  55,199
  58,668
  62,280
  66,042
  69,963
  74,051
Working capital, $m
  -6
  -7
  -8
  -9
  -11
  -13
  -15
  -17
  -19
  -21
  -23
  -26
  -28
  -31
  -34
  -37
  -40
  -43
  -47
  -50
  -54
  -57
  -61
  -65
  -69
  -74
  -78
  -83
  -88
  -93
Total debt, $m
  3,350
  4,262
  5,282
  6,410
  7,646
  8,988
  10,433
  11,979
  13,624
  15,366
  17,203
  19,132
  21,153
  23,266
  25,470
  27,767
  30,157
  32,642
  35,226
  37,911
  40,701
  43,601
  46,615
  49,749
  53,010
  56,402
  59,934
  63,614
  67,448
  71,445
Total liabilities, $m
  4,320
  5,232
  6,252
  7,380
  8,616
  9,958
  11,403
  12,949
  14,594
  16,336
  18,173
  20,102
  22,123
  24,236
  26,440
  28,737
  31,127
  33,612
  36,196
  38,881
  41,671
  44,571
  47,585
  50,719
  53,980
  57,372
  60,904
  64,584
  68,418
  72,415
Total equity, $m
  847
  1,026
  1,226
  1,448
  1,690
  1,953
  2,237
  2,540
  2,863
  3,205
  3,565
  3,943
  4,340
  4,754
  5,187
  5,637
  6,106
  6,594
  7,101
  7,627
  8,175
  8,744
  9,335
  9,950
  10,589
  11,255
  11,948
  12,669
  13,422
  14,206
Total liabilities and equity, $m
  5,167
  6,258
  7,478
  8,828
  10,306
  11,911
  13,640
  15,489
  17,457
  19,541
  21,738
  24,045
  26,463
  28,990
  31,627
  34,374
  37,233
  40,206
  43,297
  46,508
  49,846
  53,315
  56,920
  60,669
  64,569
  68,627
  72,852
  77,253
  81,840
  86,621
Debt-to-equity ratio
  3.950
  4.150
  4.310
  4.430
  4.520
  4.600
  4.660
  4.720
  4.760
  4.790
  4.830
  4.850
  4.870
  4.890
  4.910
  4.930
  4.940
  4.950
  4.960
  4.970
  4.980
  4.990
  4.990
  5.000
  5.010
  5.010
  5.020
  5.020
  5.030
  5.030
Adjusted equity ratio
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164
  0.164

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  593
  816
  1,066
  1,342
  1,645
  1,973
  2,327
  2,706
  3,109
  3,535
  4,211
  4,683
  5,178
  5,696
  6,235
  6,798
  7,383
  7,992
  8,626
  9,284
  9,968
  10,679
  11,419
  12,188
  12,988
  13,821
  14,689
  15,593
  16,535
  17,518
Depreciation, amort., depletion, $m
  751
  844
  949
  1,064
  1,190
  1,328
  1,475
  1,634
  1,802
  1,980
  1,858
  2,056
  2,262
  2,478
  2,704
  2,939
  3,183
  3,437
  3,701
  3,976
  4,261
  4,558
  4,866
  5,186
  5,520
  5,867
  6,228
  6,604
  6,996
  7,405
Funds from operations, $m
  1,344
  1,661
  2,014
  2,406
  2,835
  3,301
  3,802
  4,339
  4,910
  5,515
  6,069
  6,739
  7,441
  8,174
  8,939
  9,737
  10,566
  11,430
  12,327
  13,260
  14,229
  15,237
  16,285
  17,374
  18,508
  19,688
  20,917
  22,197
  23,532
  24,923
Change in working capital, $m
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
Cash from operations, $m
  1,345
  1,662
  2,016
  2,408
  2,837
  3,302
  3,804
  4,341
  4,913
  5,517
  6,071
  6,741
  7,443
  8,177
  8,942
  9,740
  10,570
  11,433
  12,330
  13,263
  14,233
  15,241
  16,288
  17,378
  18,512
  19,692
  20,921
  22,202
  23,536
  24,928
Maintenance CAPEX, $m
  -359
  -442
  -535
  -639
  -755
  -881
  -1,018
  -1,166
  -1,324
  -1,492
  -1,671
  -1,858
  -2,056
  -2,262
  -2,478
  -2,704
  -2,939
  -3,183
  -3,437
  -3,701
  -3,976
  -4,261
  -4,558
  -4,866
  -5,186
  -5,520
  -5,867
  -6,228
  -6,604
  -6,996
New CAPEX, $m
  -823
  -933
  -1,043
  -1,154
  -1,264
  -1,372
  -1,478
  -1,581
  -1,682
  -1,781
  -1,878
  -1,973
  -2,067
  -2,160
  -2,254
  -2,348
  -2,444
  -2,542
  -2,642
  -2,746
  -2,853
  -2,965
  -3,082
  -3,205
  -3,334
  -3,469
  -3,612
  -3,762
  -3,921
  -4,088
Cash from investing activities, $m
  -1,182
  -1,375
  -1,578
  -1,793
  -2,019
  -2,253
  -2,496
  -2,747
  -3,006
  -3,273
  -3,549
  -3,831
  -4,123
  -4,422
  -4,732
  -5,052
  -5,383
  -5,725
  -6,079
  -6,447
  -6,829
  -7,226
  -7,640
  -8,071
  -8,520
  -8,989
  -9,479
  -9,990
  -10,525
  -11,084
Free cash flow, $m
  163
  287
  438
  614
  818
  1,050
  1,308
  1,594
  1,906
  2,244
  2,523
  2,910
  3,321
  3,754
  4,210
  4,687
  5,187
  5,708
  6,251
  6,816
  7,404
  8,014
  8,648
  9,307
  9,992
  10,703
  11,443
  12,211
  13,011
  13,844
Issuance/(repayment) of debt, $m
  804
  912
  1,020
  1,128
  1,236
  1,342
  1,445
  1,546
  1,645
  1,742
  1,836
  1,929
  2,021
  2,113
  2,204
  2,296
  2,390
  2,486
  2,584
  2,685
  2,790
  2,900
  3,014
  3,134
  3,260
  3,393
  3,532
  3,679
  3,834
  3,998
Issuance/(repurchase) of shares, $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 from financing (excl. dividends), $m  
  804
  912
  1,020
  1,128
  1,236
  1,342
  1,445
  1,546
  1,645
  1,742
  1,836
  1,929
  2,021
  2,113
  2,204
  2,296
  2,390
  2,486
  2,584
  2,685
  2,790
  2,900
  3,014
  3,134
  3,260
  3,393
  3,532
  3,679
  3,834
  3,998
Total cash flow (excl. dividends), $m
  967
  1,199
  1,458
  1,743
  2,054
  2,391
  2,753
  3,140
  3,551
  3,986
  4,359
  4,839
  5,342
  5,867
  6,414
  6,984
  7,577
  8,194
  8,835
  9,501
  10,194
  10,914
  11,663
  12,441
  13,252
  14,096
  14,975
  15,891
  16,846
  17,842
Retained Cash Flow (-), $m
  -158
  -179
  -200
  -221
  -242
  -263
  -283
  -303
  -323
  -342
  -360
  -378
  -397
  -414
  -432
  -451
  -469
  -488
  -507
  -527
  -547
  -569
  -591
  -615
  -640
  -666
  -693
  -722
  -752
  -784
Prev. year cash balance distribution, $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 flow adjustment, $m
  11
  14
  17
  20
  24
  28
  32
  37
  42
  47
  53
  58
  65
  71
  78
  85
  92
  100
  108
  116
  125
  134
  143
  153
  163
  174
  185
  196
  208
  220
Cash available for distribution, $m
  808
  1,021
  1,258
  1,521
  1,812
  2,128
  2,470
  2,837
  3,228
  3,644
  3,999
  4,461
  4,945
  5,452
  5,982
  6,533
  7,108
  7,706
  8,328
  8,974
  9,646
  10,345
  11,071
  11,827
  12,612
  13,430
  14,282
  15,169
  16,093
  17,058
Discount rate, %
  9.00
  9.45
  9.92
  10.42
  10.94
  11.49
  12.06
  12.66
  13.30
  13.96
  14.66
  15.39
  16.16
  16.97
  17.82
  18.71
  19.65
  20.63
  21.66
  22.74
  23.88
  25.07
  26.33
  27.64
  29.03
  30.48
  32.00
  33.60
  35.28
  37.05
PV of cash for distribution, $m
  742
  852
  947
  1,023
  1,078
  1,108
  1,113
  1,093
  1,050
  986
  888
  800
  705
  607
  511
  420
  337
  263
  201
  149
  107
  75
  51
  34
  22
  13
  8
  5
  3
  1
Current shareholders' claim on cash, %
  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

Allison Transmission Holdings, Inc. and its subsidiaries design and manufacture commercial and defense fully-automatic transmissions. The Company manufactures fully-automatic transmissions for medium- and heavy-duty commercial vehicles, and medium-and heavy-tactical United States defense vehicles. The Company's transmissions are used in a range of applications, including on-highway trucks (distribution, refuse, construction, fire and emergency), buses (primarily school, transit and hybrid-transit), motorhomes, off-highway vehicles and equipment (energy, mining and construction) and defense vehicles (wheeled and tracked). The Company's transmissions are sold under the Allison Transmission brand name and remanufactured transmissions are sold under the ReTran brand name. The Company has developed over 100 different models that were used in more than 2,500 different vehicle configurations and were compatible with over 500 combinations of engines, as of December 31, 2016.

FINANCIAL RATIOS  of  Allison Transmission Holdings (ALSN)

Valuation Ratios
P/E Ratio 36.4
Price to Sales 4.3
Price to Book 7.3
Price to Tangible Book
Price to Cash Flow 13.3
Price to Free Cash Flow 15.1
Growth Rates
Sales Growth Rate -7.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 20%
Cap. Spend. - 3 Yr. Gr. Rate -2.8%
Financial Strength
Quick Ratio 17
Current Ratio 0.1
LT Debt to Equity 198.8%
Total Debt to Equity 199.9%
Interest Coverage 5
Management Effectiveness
Return On Assets 6.1%
Ret/ On Assets - 3 Yr. Avg. 6.1%
Return On Total Capital 6.3%
Ret/ On T. Cap. - 3 Yr. Avg. 5.6%
Return On Equity 19%
Return On Equity - 3 Yr. Avg. 16.4%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 47%
Gross Margin - 3 Yr. Avg. 46.6%
EBITDA Margin 32.3%
EBITDA Margin - 3 Yr. Avg. 31.3%
Operating Margin 24.5%
Oper. Margin - 3 Yr. Avg. 23.3%
Pre-Tax Margin 18.5%
Pre-Tax Margin - 3 Yr. Avg. 16.8%
Net Profit Margin 11.7%
Net Profit Margin - 3 Yr. Avg. 10.5%
Effective Tax Rate 37%
Eff/ Tax Rate - 3 Yr. Avg. 37.2%
Payout Ratio 47%

ALSN stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ALSN stock intrinsic value calculation we used $2262 million for the last fiscal year's total revenue generated by Allison Transmission Holdings. The default revenue input number comes from 2017 income statement of Allison Transmission Holdings. 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 ALSN stock valuation model: a) initial revenue growth rate of 22.9% 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 9%, whose default value for ALSN is calculated based on our internal credit rating of Allison Transmission Holdings, 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 Allison Transmission Holdings.
    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 ALSN stock the variable cost ratio is equal to 52.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $429 million in the base year in the intrinsic value calculation for ALSN 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 5.4% for Allison Transmission Holdings.

Corporate tax rate of 27% is the nominal tax rate for Allison Transmission Holdings. 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 ALSN stock is equal to 0.5%.

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 ALSN are equal to 158.9%.

Life of production assets of 10 years is the average useful life of capital assets used in Allison Transmission Holdings 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 ALSN is equal to -0.2%. 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 - $689 million for Allison Transmission Holdings - 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 142 million for Allison Transmission Holdings 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 Allison Transmission Holdings at the current share price and the inputted number of shares is $6.8 billion.

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COMPANY NEWS

▶ Why Allison Transmission Stock Popped 10%   [01:23PM  Motley Fool]
▶ After-hours buzz: AKS, TXRH & more   [Jul-30-18 05:58PM  CNBC]
▶ Allison Transmission: 2Q Earnings Snapshot   [04:31PM  Associated Press]
▶ Allison Transmission Declares Quarterly Dividend   [Jul-23-18 04:05PM  Business Wire]
▶ Allison Transmission announces Fred Bohley as next CFO   [May-11-18 08:30AM  PR Newswire]
▶ Allison Transmission declares quarterly dividend   [May-10-18 04:05PM  PR Newswire]
▶ After-hours buzz: CGNX, AKAM & more   [Apr-30-18 05:37PM  CNBC]
▶ Allison Transmission: 1Q Earnings Snapshot   [04:18PM  Associated Press]
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