Intrinsic value of Asure Software Inc - ASUR

Previous Close

$7.86

  Intrinsic Value

$15.58

stock screener

  Rating & Target

str. buy

+98%

Previous close

$7.86

 
Intrinsic value

$15.58

 
Up/down potential

+98%

 
Rating

str. buy

We calculate the intrinsic value of ASUR 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 0.1

 

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, %
  51.10
  46.49
  42.34
  38.61
  35.25
  32.22
  29.50
  27.05
  24.84
  22.86
  21.07
  19.47
  18.02
  16.72
  15.55
  14.49
  13.54
  12.69
  11.92
  11.23
  10.60
  10.04
  9.54
  9.09
  8.68
  8.31
  7.98
  7.68
  7.41
  7.17
Revenue, $m
  82
  120
  170
  236
  319
  422
  546
  694
  866
  1,064
  1,288
  1,539
  1,817
  2,120
  2,450
  2,805
  3,185
  3,589
  4,017
  4,468
  4,942
  5,438
  5,957
  6,498
  7,062
  7,649
  8,259
  8,893
  9,553
  10,238
Variable operating expenses, $m
  78
  114
  163
  225
  305
  403
  521
  662
  827
  1,015
  1,229
  1,468
  1,733
  2,022
  2,337
  2,675
  3,038
  3,423
  3,831
  4,261
  4,713
  5,187
  5,681
  6,197
  6,735
  7,295
  7,877
  8,482
  9,111
  9,764
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
  78
  114
  163
  225
  305
  403
  521
  662
  827
  1,015
  1,229
  1,468
  1,733
  2,022
  2,337
  2,675
  3,038
  3,423
  3,831
  4,261
  4,713
  5,187
  5,681
  6,197
  6,735
  7,295
  7,877
  8,482
  9,111
  9,764
Operating income, $m
  3
  5
  7
  10
  14
  19
  25
  32
  40
  49
  60
  71
  84
  98
  113
  130
  147
  166
  186
  207
  229
  252
  276
  301
  327
  354
  382
  411
  442
  474
EBITDA, $m
  9
  13
  18
  25
  33
  44
  57
  73
  91
  112
  135
  161
  191
  222
  257
  294
  334
  376
  421
  469
  518
  570
  625
  681
  741
  802
  866
  933
  1,002
  1,074
Interest expense (income), $m
  1
  7
  13
  21
  33
  47
  66
  89
  117
  150
  189
  233
  284
  340
  402
  470
  544
  624
  709
  800
  896
  997
  1,103
  1,215
  1,331
  1,452
  1,579
  1,711
  1,848
  1,990
  2,138
Earnings before tax, $m
  -3
  -8
  -14
  -22
  -33
  -47
  -64
  -85
  -111
  -140
  -174
  -212
  -256
  -304
  -357
  -414
  -477
  -543
  -614
  -689
  -768
  -852
  -939
  -1,030
  -1,126
  -1,225
  -1,329
  -1,436
  -1,548
  -1,664
Tax expense, $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
Net income, $m
  -3
  -8
  -14
  -22
  -33
  -47
  -64
  -85
  -111
  -140
  -174
  -212
  -256
  -304
  -357
  -414
  -477
  -543
  -614
  -689
  -768
  -852
  -939
  -1,030
  -1,126
  -1,225
  -1,329
  -1,436
  -1,548
  -1,664

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
  307
  449
  640
  887
  1,199
  1,585
  2,053
  2,608
  3,256
  4,001
  4,844
  5,787
  6,830
  7,971
  9,211
  10,546
  11,974
  13,493
  15,101
  16,797
  18,578
  20,444
  22,394
  24,429
  26,549
  28,755
  31,049
  33,434
  35,912
  38,487
Adjusted assets (=assets-cash), $m
  307
  449
  640
  887
  1,199
  1,585
  2,053
  2,608
  3,256
  4,001
  4,844
  5,787
  6,830
  7,971
  9,211
  10,546
  11,974
  13,493
  15,101
  16,797
  18,578
  20,444
  22,394
  24,429
  26,549
  28,755
  31,049
  33,434
  35,912
  38,487
Revenue / Adjusted assets
  0.267
  0.267
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
  0.266
Average production assets, $m
  62
  90
  129
  178
  241
  319
  413
  525
  655
  805
  974
  1,164
  1,373
  1,603
  1,852
  2,121
  2,408
  2,713
  3,037
  3,378
  3,736
  4,111
  4,503
  4,913
  5,339
  5,782
  6,244
  6,723
  7,222
  7,740
Working capital, $m
  -3
  -4
  -6
  -8
  -11
  -15
  -19
  -24
  -30
  -37
  -45
  -54
  -64
  -74
  -86
  -98
  -111
  -126
  -141
  -156
  -173
  -190
  -208
  -227
  -247
  -268
  -289
  -311
  -334
  -358
Total debt, $m
  147
  245
  375
  544
  759
  1,024
  1,345
  1,726
  2,170
  2,681
  3,259
  3,906
  4,622
  5,405
  6,255
  7,171
  8,150
  9,192
  10,296
  11,459
  12,681
  13,961
  15,299
  16,695
  18,149
  19,662
  21,236
  22,872
  24,572
  26,339
Total liabilities, $m
  210
  308
  439
  608
  823
  1,088
  1,408
  1,789
  2,234
  2,745
  3,323
  3,970
  4,685
  5,468
  6,319
  7,234
  8,214
  9,256
  10,359
  11,522
  12,744
  14,024
  15,362
  16,758
  18,212
  19,726
  21,300
  22,935
  24,636
  26,402
Total equity, $m
  96
  141
  201
  278
  376
  498
  645
  819
  1,023
  1,256
  1,521
  1,817
  2,145
  2,503
  2,892
  3,311
  3,760
  4,237
  4,742
  5,274
  5,833
  6,419
  7,032
  7,671
  8,336
  9,029
  9,749
  10,498
  11,276
  12,085
Total liabilities and equity, $m
  306
  449
  640
  886
  1,199
  1,586
  2,053
  2,608
  3,257
  4,001
  4,844
  5,787
  6,830
  7,971
  9,211
  10,545
  11,974
  13,493
  15,101
  16,796
  18,577
  20,443
  22,394
  24,429
  26,548
  28,755
  31,049
  33,433
  35,912
  38,487
Debt-to-equity ratio
  1.520
  1.730
  1.870
  1.960
  2.020
  2.060
  2.090
  2.110
  2.120
  2.130
  2.140
  2.150
  2.160
  2.160
  2.160
  2.170
  2.170
  2.170
  2.170
  2.170
  2.170
  2.170
  2.180
  2.180
  2.180
  2.180
  2.180
  2.180
  2.180
  2.180
Adjusted equity ratio
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -3
  -8
  -14
  -22
  -33
  -47
  -64
  -85
  -111
  -140
  -174
  -212
  -256
  -304
  -357
  -414
  -477
  -543
  -614
  -689
  -768
  -852
  -939
  -1,030
  -1,126
  -1,225
  -1,329
  -1,436
  -1,548
  -1,664
Depreciation, amort., depletion, $m
  5
  8
  10
  14
  19
  25
  33
  41
  51
  63
  76
  90
  106
  124
  144
  164
  187
  210
  235
  262
  290
  319
  349
  381
  414
  448
  484
  521
  560
  600
Funds from operations, $m
  2
  0
  -3
  -8
  -14
  -22
  -32
  -44
  -59
  -77
  -98
  -122
  -149
  -180
  -213
  -250
  -290
  -333
  -379
  -427
  -479
  -533
  -590
  -650
  -712
  -777
  -845
  -915
  -988
  -1,064
Change in working capital, $m
  -1
  -1
  -2
  -2
  -3
  -4
  -4
  -5
  -6
  -7
  -8
  -9
  -10
  -11
  -12
  -12
  -13
  -14
  -15
  -16
  -17
  -17
  -18
  -19
  -20
  -21
  -21
  -22
  -23
  -24
Cash from operations, $m
  3
  1
  -2
  -6
  -11
  -18
  -27
  -39
  -53
  -70
  -90
  -113
  -140
  -169
  -202
  -238
  -277
  -319
  -364
  -411
  -462
  -516
  -572
  -631
  -692
  -756
  -823
  -893
  -965
  -1,040
Maintenance CAPEX, $m
  -3
  -5
  -7
  -10
  -14
  -19
  -25
  -32
  -41
  -51
  -62
  -76
  -90
  -106
  -124
  -144
  -164
  -187
  -210
  -235
  -262
  -290
  -319
  -349
  -381
  -414
  -448
  -484
  -521
  -560
New CAPEX, $m
  -21
  -29
  -38
  -50
  -63
  -78
  -94
  -112
  -130
  -150
  -170
  -190
  -210
  -230
  -249
  -268
  -287
  -306
  -323
  -341
  -358
  -375
  -392
  -409
  -426
  -444
  -461
  -480
  -498
  -518
Cash from investing activities, $m
  -24
  -34
  -45
  -60
  -77
  -97
  -119
  -144
  -171
  -201
  -232
  -266
  -300
  -336
  -373
  -412
  -451
  -493
  -533
  -576
  -620
  -665
  -711
  -758
  -807
  -858
  -909
  -964
  -1,019
  -1,078
Free cash flow, $m
  -21
  -32
  -47
  -65
  -88
  -115
  -146
  -183
  -224
  -271
  -322
  -378
  -440
  -505
  -575
  -650
  -728
  -811
  -897
  -988
  -1,082
  -1,180
  -1,283
  -1,389
  -1,499
  -1,614
  -1,733
  -1,856
  -1,985
  -2,118
Issuance/(repayment) of debt, $m
  71
  98
  131
  169
  214
  265
  321
  381
  445
  511
  578
  647
  715
  783
  850
  916
  980
  1,042
  1,103
  1,163
  1,222
  1,280
  1,338
  1,396
  1,454
  1,513
  1,574
  1,636
  1,700
  1,767
Issuance/(repurchase) of shares, $m
  36
  53
  74
  100
  131
  168
  211
  260
  314
  374
  438
  508
  583
  663
  746
  834
  925
  1,020
  1,119
  1,221
  1,328
  1,438
  1,551
  1,669
  1,791
  1,918
  2,049
  2,185
  2,326
  2,473
Cash from financing (excl. dividends), $m  
  107
  151
  205
  269
  345
  433
  532
  641
  759
  885
  1,016
  1,155
  1,298
  1,446
  1,596
  1,750
  1,905
  2,062
  2,222
  2,384
  2,550
  2,718
  2,889
  3,065
  3,245
  3,431
  3,623
  3,821
  4,026
  4,240
Total cash flow (excl. dividends), $m
  86
  118
  157
  204
  258
  319
  386
  458
  534
  614
  695
  777
  859
  941
  1,021
  1,100
  1,176
  1,252
  1,325
  1,397
  1,467
  1,537
  1,607
  1,676
  1,746
  1,817
  1,890
  1,965
  2,042
  2,122
Retained Cash Flow (-), $m
  -36
  -53
  -74
  -100
  -131
  -168
  -211
  -260
  -314
  -374
  -438
  -508
  -583
  -663
  -746
  -834
  -925
  -1,020
  -1,119
  -1,221
  -1,328
  -1,438
  -1,551
  -1,669
  -1,791
  -1,918
  -2,049
  -2,185
  -2,326
  -2,473
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
  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
  50
  65
  84
  104
  127
  150
  175
  198
  220
  240
  256
  268
  276
  278
  275
  266
  252
  231
  206
  175
  140
  100
  55
  7
  -45
  -100
  -159
  -220
  -285
  -351
Discount rate, %
  8.10
  8.51
  8.93
  9.38
  9.85
  10.34
  10.85
  11.40
  11.97
  12.57
  13.19
  13.85
  14.55
  15.27
  16.04
  16.84
  17.68
  18.57
  19.49
  20.47
  21.49
  22.57
  23.69
  24.88
  26.12
  27.43
  28.80
  30.24
  31.75
  33.34
PV of cash for distribution, $m
  46
  56
  65
  73
  79
  83
  85
  84
  80
  73
  66
  57
  47
  38
  30
  22
  16
  11
  7
  4
  2
  1
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  77.1
  59.8
  46.9
  37.1
  29.7
  24.0
  19.6
  16.2
  13.5
  11.3
  9.5
  8.1
  6.9
  5.9
  5.1
  4.5
  3.9
  3.4
  3.0
  2.6
  2.3
  2.0
  1.8
  1.6
  1.4
  1.3
  1.1
  1.0
  0.9
  0.8

Asure Software, Inc. is a global provider of cloud-based software-as-a-service (SaaS) solutions that help companies to bring people, time, space and assets together. The Company serves approximately 6,000 clients in over 80 countries. The Company offers a range of solutions to help its clients optimize and manage mobile workforces and global workspaces. Its SaaS-based offerings include asset management, mobile room scheduling, mobile time tracking, scheduling software, space utilization solutions, tablet-based time clocks, time clocks, touch panels for room scheduling and workplace business intelligence (BI) analytics. It offers approximately two product lines, including AsureSpace and AsureForce. Its AsureSpace provides workplace management solutions that enable organizations to manage their office environments and manage real estate utilization. Its AsureForce time and labor management solutions help organizations to manage labor and labor administration costs and activities.

FINANCIAL RATIOS  of  Asure Software Inc (ASUR)

Valuation Ratios
P/E Ratio -67
Price to Sales 1.9
Price to Book 3.7
Price to Tangible Book
Price to Cash Flow -33.5
Price to Free Cash Flow -33.5
Growth Rates
Sales Growth Rate 33.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -100%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio 3
Current Ratio 0.6
LT Debt to Equity 138.9%
Total Debt to Equity 166.7%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. -0%
Return On Total Capital -3.1%
Ret/ On T. Cap. - 3 Yr. Avg. -4.7%
Return On Equity -9.1%
Return On Equity - 3 Yr. Avg. -19.7%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 75%
Gross Margin - 3 Yr. Avg. 75.6%
EBITDA Margin 11.1%
EBITDA Margin - 3 Yr. Avg. 11.1%
Operating Margin 5.6%
Oper. Margin - 3 Yr. Avg. 3.1%
Pre-Tax Margin -2.8%
Pre-Tax Margin - 3 Yr. Avg. -3.4%
Net Profit Margin -2.8%
Net Profit Margin - 3 Yr. Avg. -3.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ASUR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ASUR stock intrinsic value calculation we used $54 million for the last fiscal year's total revenue generated by Asure Software Inc. The default revenue input number comes from 0001 income statement of Asure Software 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 ASUR stock valuation model: a) initial revenue growth rate of 51.1% 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 8.1%, whose default value for ASUR is calculated based on our internal credit rating of Asure Software 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 Asure Software 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 ASUR stock the variable cost ratio is equal to 96.3%.

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 ASUR 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 8.7% for Asure Software Inc.

Corporate tax rate of 27% is the nominal tax rate for Asure Software 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 ASUR 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 ASUR are equal to 75.6%.

Life of production assets of 12.9 years is the average useful life of capital assets used in Asure Software 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 ASUR is equal to -3.5%. 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 - $63.774 million for Asure Software 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 15.348 million for Asure Software 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 Asure Software Inc at the current share price and the inputted number of shares is $0.1 billion.

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