Intrinsic value of ANGI Homeservices Inc. - ANGI

Previous Close

$14.52

  Intrinsic Value

$20.92

stock screener

  Rating & Target

buy

+44%

Previous close

$14.52

 
Intrinsic value

$20.92

 
Up/down potential

+44%

 
Rating

buy

We calculate the intrinsic value of ANGI 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 7.3

 

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, %
  25.00
  23.00
  21.20
  19.58
  18.12
  16.81
  15.63
  14.57
  13.61
  12.75
  11.97
  11.28
  10.65
  10.08
  9.58
  9.12
  8.71
  8.34
  8.00
  7.70
  7.43
  7.19
  6.97
  6.77
  6.60
  6.44
  6.29
  6.16
  6.05
  5.94
Revenue, $m
  1,415
  1,740
  2,109
  2,522
  2,980
  3,480
  4,024
  4,611
  5,238
  5,906
  6,613
  7,359
  8,142
  8,963
  9,822
  10,717
  11,650
  12,621
  13,631
  14,681
  15,772
  16,906
  18,084
  19,309
  20,582
  21,907
  23,285
  24,720
  26,215
  27,773
Variable operating expenses, $m
  658
  807
  977
  1,167
  1,377
  1,607
  1,857
  2,127
  2,415
  2,722
  3,040
  3,383
  3,743
  4,121
  4,515
  4,927
  5,356
  5,802
  6,267
  6,749
  7,251
  7,772
  8,314
  8,877
  9,462
  10,071
  10,705
  11,365
  12,052
  12,768
Fixed operating expenses, $m
  565
  578
  590
  603
  617
  630
  644
  658
  673
  687
  703
  718
  734
  750
  766
  783
  801
  818
  836
  855
  873
  893
  912
  932
  953
  974
  995
  1,017
  1,039
  1,062
Total operating expenses, $m
  1,223
  1,385
  1,567
  1,770
  1,994
  2,237
  2,501
  2,785
  3,088
  3,409
  3,743
  4,101
  4,477
  4,871
  5,281
  5,710
  6,157
  6,620
  7,103
  7,604
  8,124
  8,665
  9,226
  9,809
  10,415
  11,045
  11,700
  12,382
  13,091
  13,830
Operating income, $m
  192
  356
  542
  752
  986
  1,243
  1,523
  1,826
  2,150
  2,496
  2,870
  3,258
  3,665
  4,093
  4,540
  5,007
  5,494
  6,001
  6,528
  7,077
  7,648
  8,241
  8,858
  9,500
  10,167
  10,862
  11,585
  12,339
  13,124
  13,942
EBITDA, $m
  256
  433
  634
  861
  1,113
  1,390
  1,692
  2,018
  2,368
  2,740
  3,136
  3,553
  3,992
  4,452
  4,934
  5,437
  5,961
  6,507
  7,076
  7,666
  8,281
  8,920
  9,584
  10,275
  10,993
  11,741
  12,520
  13,331
  14,176
  15,057
Interest expense (income), $m
  0
  14
  21
  28
  37
  46
  57
  68
  81
  94
  108
  124
  140
  157
  175
  194
  214
  234
  256
  278
  301
  326
  351
  377
  404
  432
  461
  492
  523
  556
  591
Earnings before tax, $m
  178
  335
  514
  716
  940
  1,187
  1,455
  1,745
  2,056
  2,388
  2,746
  3,118
  3,508
  3,917
  4,346
  4,793
  5,259
  5,745
  6,250
  6,776
  7,322
  7,890
  8,481
  9,096
  9,735
  10,401
  11,094
  11,815
  12,568
  13,352
Tax expense, $m
  48
  90
  139
  193
  254
  320
  393
  471
  555
  645
  742
  842
  947
  1,058
  1,173
  1,294
  1,420
  1,551
  1,688
  1,829
  1,977
  2,130
  2,290
  2,456
  2,629
  2,808
  2,995
  3,190
  3,393
  3,605
Net income, $m
  130
  245
  375
  523
  686
  866
  1,062
  1,274
  1,501
  1,743
  2,005
  2,276
  2,561
  2,860
  3,172
  3,499
  3,839
  4,194
  4,563
  4,946
  5,345
  5,760
  6,191
  6,640
  7,107
  7,593
  8,098
  8,625
  9,174
  9,747

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
  2,042
  2,511
  3,044
  3,640
  4,300
  5,022
  5,807
  6,653
  7,558
  8,522
  9,542
  10,619
  11,749
  12,934
  14,172
  15,465
  16,811
  18,212
  19,670
  21,185
  22,759
  24,395
  26,095
  27,862
  29,700
  31,611
  33,601
  35,671
  37,828
  40,076
Adjusted assets (=assets-cash), $m
  2,042
  2,511
  3,044
  3,640
  4,300
  5,022
  5,807
  6,653
  7,558
  8,522
  9,542
  10,619
  11,749
  12,934
  14,172
  15,465
  16,811
  18,212
  19,670
  21,185
  22,759
  24,395
  26,095
  27,862
  29,700
  31,611
  33,601
  35,671
  37,828
  40,076
Revenue / Adjusted assets
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
  0.693
Average production assets, $m
  795
  978
  1,185
  1,418
  1,675
  1,956
  2,262
  2,591
  2,944
  3,319
  3,716
  4,136
  4,576
  5,037
  5,520
  6,023
  6,547
  7,093
  7,661
  8,251
  8,864
  9,501
  10,163
  10,851
  11,567
  12,312
  13,086
  13,893
  14,733
  15,608
Working capital, $m
  -95
  -117
  -141
  -169
  -200
  -233
  -270
  -309
  -351
  -396
  -443
  -493
  -546
  -601
  -658
  -718
  -781
  -846
  -913
  -984
  -1,057
  -1,133
  -1,212
  -1,294
  -1,379
  -1,468
  -1,560
  -1,656
  -1,756
  -1,861
Total debt, $m
  381
  519
  676
  852
  1,047
  1,260
  1,492
  1,741
  2,008
  2,292
  2,593
  2,911
  3,244
  3,594
  3,959
  4,340
  4,738
  5,151
  5,581
  6,028
  6,492
  6,975
  7,476
  7,998
  8,540
  9,104
  9,691
  10,301
  10,938
  11,601
Total liabilities, $m
  602
  741
  898
  1,074
  1,268
  1,482
  1,713
  1,963
  2,230
  2,514
  2,815
  3,132
  3,466
  3,816
  4,181
  4,562
  4,959
  5,373
  5,803
  6,249
  6,714
  7,196
  7,698
  8,219
  8,762
  9,325
  9,912
  10,523
  11,159
  11,822
Total equity, $m
  1,440
  1,771
  2,146
  2,566
  3,031
  3,541
  4,094
  4,690
  5,329
  6,008
  6,727
  7,486
  8,283
  9,118
  9,992
  10,903
  11,852
  12,840
  13,867
  14,935
  16,045
  17,198
  18,397
  19,643
  20,939
  22,286
  23,688
  25,148
  26,669
  28,254
Total liabilities and equity, $m
  2,042
  2,512
  3,044
  3,640
  4,299
  5,023
  5,807
  6,653
  7,559
  8,522
  9,542
  10,618
  11,749
  12,934
  14,173
  15,465
  16,811
  18,213
  19,670
  21,184
  22,759
  24,394
  26,095
  27,862
  29,701
  31,611
  33,600
  35,671
  37,828
  40,076
Debt-to-equity ratio
  0.260
  0.290
  0.320
  0.330
  0.350
  0.360
  0.360
  0.370
  0.380
  0.380
  0.390
  0.390
  0.390
  0.390
  0.400
  0.400
  0.400
  0.400
  0.400
  0.400
  0.400
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
Adjusted equity ratio
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  130
  245
  375
  523
  686
  866
  1,062
  1,274
  1,501
  1,743
  2,005
  2,276
  2,561
  2,860
  3,172
  3,499
  3,839
  4,194
  4,563
  4,946
  5,345
  5,760
  6,191
  6,640
  7,107
  7,593
  8,098
  8,625
  9,174
  9,747
Depreciation, amort., depletion, $m
  64
  77
  92
  108
  127
  147
  169
  192
  217
  244
  265
  295
  327
  360
  394
  430
  468
  507
  547
  589
  633
  679
  726
  775
  826
  879
  935
  992
  1,052
  1,115
Funds from operations, $m
  194
  322
  467
  631
  813
  1,013
  1,231
  1,466
  1,718
  1,987
  2,270
  2,571
  2,888
  3,220
  3,567
  3,929
  4,307
  4,700
  5,110
  5,536
  5,978
  6,439
  6,917
  7,415
  7,933
  8,472
  9,033
  9,618
  10,227
  10,862
Change in working capital, $m
  -19
  -22
  -25
  -28
  -31
  -34
  -36
  -39
  -42
  -45
  -47
  -50
  -53
  -55
  -58
  -60
  -63
  -65
  -68
  -70
  -73
  -76
  -79
  -82
  -85
  -89
  -92
  -96
  -100
  -104
Cash from operations, $m
  213
  343
  492
  659
  844
  1,047
  1,267
  1,505
  1,760
  2,032
  2,318
  2,621
  2,940
  3,275
  3,624
  3,989
  4,369
  4,765
  5,177
  5,606
  6,051
  6,515
  6,996
  7,497
  8,018
  8,561
  9,125
  9,714
  10,327
  10,966
Maintenance CAPEX, $m
  -45
  -57
  -70
  -85
  -101
  -120
  -140
  -162
  -185
  -210
  -237
  -265
  -295
  -327
  -360
  -394
  -430
  -468
  -507
  -547
  -589
  -633
  -679
  -726
  -775
  -826
  -879
  -935
  -992
  -1,052
New CAPEX, $m
  -159
  -183
  -207
  -232
  -257
  -281
  -306
  -329
  -353
  -375
  -397
  -419
  -440
  -461
  -482
  -503
  -524
  -546
  -568
  -590
  -613
  -637
  -662
  -688
  -716
  -744
  -775
  -807
  -840
  -875
Cash from investing activities, $m
  -204
  -240
  -277
  -317
  -358
  -401
  -446
  -491
  -538
  -585
  -634
  -684
  -735
  -788
  -842
  -897
  -954
  -1,014
  -1,075
  -1,137
  -1,202
  -1,270
  -1,341
  -1,414
  -1,491
  -1,570
  -1,654
  -1,742
  -1,832
  -1,927
Free cash flow, $m
  9
  104
  215
  342
  485
  646
  822
  1,014
  1,223
  1,446
  1,683
  1,937
  2,204
  2,486
  2,782
  3,092
  3,415
  3,752
  4,103
  4,469
  4,849
  5,244
  5,655
  6,083
  6,528
  6,990
  7,471
  7,972
  8,494
  9,038
Issuance/(repayment) of debt, $m
  121
  139
  157
  176
  195
  213
  232
  250
  267
  284
  301
  317
  334
  350
  365
  381
  397
  413
  430
  447
  464
  483
  502
  521
  542
  564
  587
  611
  636
  663
Issuance/(repurchase) of shares, $m
  157
  86
  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  
  278
  225
  157
  176
  195
  213
  232
  250
  267
  284
  301
  317
  334
  350
  365
  381
  397
  413
  430
  447
  464
  483
  502
  521
  542
  564
  587
  611
  636
  663
Total cash flow (excl. dividends), $m
  287
  329
  372
  518
  680
  859
  1,053
  1,264
  1,490
  1,731
  1,984
  2,254
  2,538
  2,836
  3,147
  3,473
  3,812
  4,165
  4,533
  4,916
  5,313
  5,727
  6,157
  6,604
  7,070
  7,554
  8,058
  8,583
  9,131
  9,701
Retained Cash Flow (-), $m
  -287
  -331
  -375
  -420
  -465
  -510
  -553
  -596
  -638
  -679
  -719
  -759
  -797
  -835
  -873
  -911
  -949
  -988
  -1,027
  -1,068
  -1,110
  -1,153
  -1,199
  -1,246
  -1,296
  -1,348
  -1,402
  -1,460
  -1,521
  -1,585
Prev. year cash balance distribution, $m
  161
  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
  160
  -2
  -4
  97
  215
  349
  500
  668
  851
  1,051
  1,265
  1,495
  1,741
  2,001
  2,274
  2,562
  2,863
  3,178
  3,506
  3,848
  4,204
  4,574
  4,958
  5,358
  5,774
  6,206
  6,656
  7,123
  7,610
  8,117
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
  154
  -2
  -3
  80
  167
  253
  338
  417
  489
  551
  601
  638
  662
  672
  668
  651
  623
  585
  540
  489
  435
  379
  325
  273
  225
  181
  143
  110
  83
  61
Current shareholders' claim on cash, %
  97.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6
  96.6

ANGI Homeservices Inc. is focused on creating digital marketplace for home services, connecting homeowners across the globe with home service professionals. The Company operates 10 brands including Angie's List, HomeAdvisor, HomeStars, Instapro, MyBuilder, MyHammer, Travaux, Werkspot, CraftJack and mHelpDesk. The Company’s brand portfolio provides homeowners with tools and resources for home repair, maintenance and improvement projects. Angie's List is America’s online review platform and provides services ranging from home repair, maintenance and improvement to auto service and health care. HomeAdvisor is the operator of the home services marketplace across the globe. HomeStars is online platform connecting homeowners with home renovators, repairmen and retailers throughout Canada. Instapro is Italy’s home services network connecting homeowners with service professionals for home renovation projects.

FINANCIAL RATIOS  of  ANGI Homeservices Inc. (ANGI)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. 0%
Return On Total Capital 0%
Ret/ On T. Cap. - 3 Yr. Avg. 0%
Return On Equity 0%
Return On Equity - 3 Yr. Avg. 0%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ANGI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ANGI stock intrinsic value calculation we used $1132 million for the last fiscal year's total revenue generated by ANGI Homeservices Inc.. The default revenue input number comes from 0001 income statement of ANGI Homeservices 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 ANGI stock valuation model: a) initial revenue growth rate of 25% 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 ANGI is calculated based on our internal credit rating of ANGI Homeservices 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 ANGI Homeservices 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 ANGI stock the variable cost ratio is equal to 46.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $553 million in the base year in the intrinsic value calculation for ANGI 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 ANGI Homeservices Inc..

Corporate tax rate of 27% is the nominal tax rate for ANGI Homeservices 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 ANGI 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 ANGI are equal to 56.2%.

Life of production assets of 14 years is the average useful life of capital assets used in ANGI Homeservices 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 ANGI is equal to -6.7%. 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 - $1312.941 million for ANGI Homeservices 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 504.096 million for ANGI Homeservices 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 ANGI Homeservices Inc. at the current share price and the inputted number of shares is $7.3 billion.

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