Intrinsic value of Allegheny Technologies - ATI

Previous Close

$25.71

  Intrinsic Value

$2.77

stock screener

  Rating & Target

str. sell

-89%

Previous close

$25.71

 
Intrinsic value

$2.77

 
Up/down potential

-89%

 
Rating

str. sell

We calculate the intrinsic value of ATI 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 2.8

 

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, %
  12.50
  11.75
  11.08
  10.47
  9.92
  9.43
  8.99
  8.59
  8.23
  7.91
  7.62
  7.35
  7.12
  6.91
  6.72
  6.54
  6.39
  6.25
  6.13
  6.01
  5.91
  5.82
  5.74
  5.66
  5.60
  5.54
  5.48
  5.44
  5.39
  5.35
Revenue, $m
  3,966
  4,432
  4,922
  5,438
  5,977
  6,541
  7,128
  7,741
  8,377
  9,040
  9,728
  10,443
  11,187
  11,959
  12,763
  13,598
  14,467
  15,371
  16,313
  17,293
  18,316
  19,382
  20,494
  21,655
  22,867
  24,134
  25,458
  26,842
  28,289
  29,803
Variable operating expenses, $m
  4,732
  5,282
  5,861
  6,469
  7,106
  7,771
  8,464
  9,186
  9,938
  10,719
  11,479
  12,323
  13,200
  14,111
  15,059
  16,045
  17,070
  18,137
  19,248
  20,405
  21,612
  22,869
  24,182
  25,552
  26,982
  28,477
  30,038
  31,671
  33,379
  35,166
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
  4,732
  5,282
  5,861
  6,469
  7,106
  7,771
  8,464
  9,186
  9,938
  10,719
  11,479
  12,323
  13,200
  14,111
  15,059
  16,045
  17,070
  18,137
  19,248
  20,405
  21,612
  22,869
  24,182
  25,552
  26,982
  28,477
  30,038
  31,671
  33,379
  35,166
Operating income, $m
  -767
  -851
  -939
  -1,032
  -1,129
  -1,230
  -1,336
  -1,446
  -1,561
  -1,680
  -1,750
  -1,879
  -2,013
  -2,152
  -2,296
  -2,447
  -2,603
  -2,766
  -2,935
  -3,112
  -3,296
  -3,488
  -3,688
  -3,897
  -4,115
  -4,343
  -4,581
  -4,830
  -5,090
  -5,363
EBITDA, $m
  -367
  -410
  -455
  -503
  -552
  -605
  -659
  -716
  -774
  -836
  -899
  -965
  -1,034
  -1,105
  -1,180
  -1,257
  -1,337
  -1,421
  -1,508
  -1,599
  -1,693
  -1,792
  -1,894
  -2,002
  -2,114
  -2,231
  -2,353
  -2,481
  -2,615
  -2,755
Interest expense (income), $m
  127
  120
  154
  189
  227
  266
  307
  350
  395
  442
  490
  541
  593
  648
  705
  764
  825
  889
  955
  1,024
  1,096
  1,170
  1,248
  1,330
  1,415
  1,503
  1,596
  1,692
  1,793
  1,899
  2,009
Earnings before tax, $m
  -887
  -1,004
  -1,128
  -1,258
  -1,395
  -1,537
  -1,686
  -1,841
  -2,002
  -2,170
  -2,291
  -2,473
  -2,661
  -2,857
  -3,060
  -3,272
  -3,492
  -3,721
  -3,959
  -4,207
  -4,466
  -4,736
  -5,017
  -5,311
  -5,618
  -5,938
  -6,273
  -6,623
  -6,989
  -7,372
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
  -887
  -1,004
  -1,128
  -1,258
  -1,395
  -1,537
  -1,686
  -1,841
  -2,002
  -2,170
  -2,291
  -2,473
  -2,661
  -2,857
  -3,060
  -3,272
  -3,492
  -3,721
  -3,959
  -4,207
  -4,466
  -4,736
  -5,017
  -5,311
  -5,618
  -5,938
  -6,273
  -6,623
  -6,989
  -7,372

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
  5,832
  6,517
  7,239
  7,997
  8,790
  9,619
  10,483
  11,383
  12,320
  13,294
  14,306
  15,358
  16,451
  17,587
  18,769
  19,997
  21,275
  22,604
  23,989
  25,432
  26,935
  28,503
  30,139
  31,846
  33,629
  35,491
  37,438
  39,473
  41,601
  43,828
Adjusted assets (=assets-cash), $m
  5,832
  6,517
  7,239
  7,997
  8,790
  9,619
  10,483
  11,383
  12,320
  13,294
  14,306
  15,358
  16,451
  17,587
  18,769
  19,997
  21,275
  22,604
  23,989
  25,432
  26,935
  28,503
  30,139
  31,846
  33,629
  35,491
  37,438
  39,473
  41,601
  43,828
Revenue / Adjusted assets
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
  0.680
Average production assets, $m
  3,470
  3,878
  4,307
  4,758
  5,230
  5,723
  6,237
  6,773
  7,330
  7,910
  8,512
  9,138
  9,789
  10,465
  11,167
  11,898
  12,658
  13,450
  14,274
  15,132
  16,026
  16,959
  17,932
  18,948
  20,009
  21,117
  22,275
  23,486
  24,753
  26,078
Working capital, $m
  849
  948
  1,053
  1,164
  1,279
  1,400
  1,525
  1,656
  1,793
  1,935
  2,082
  2,235
  2,394
  2,559
  2,731
  2,910
  3,096
  3,289
  3,491
  3,701
  3,920
  4,148
  4,386
  4,634
  4,894
  5,165
  5,448
  5,744
  6,054
  6,378
Total debt, $m
  1,972
  2,428
  2,908
  3,412
  3,940
  4,491
  5,065
  5,664
  6,287
  6,935
  7,608
  8,307
  9,034
  9,790
  10,575
  11,392
  12,242
  13,126
  14,047
  15,006
  16,006
  17,049
  18,136
  19,272
  20,457
  21,696
  22,990
  24,344
  25,759
  27,240
Total liabilities, $m
  3,878
  4,334
  4,814
  5,318
  5,845
  6,396
  6,971
  7,570
  8,193
  8,840
  9,514
  10,213
  10,940
  11,696
  12,481
  13,298
  14,148
  15,032
  15,953
  16,912
  17,912
  18,954
  20,042
  21,177
  22,363
  23,602
  24,896
  26,249
  27,665
  29,146
Total equity, $m
  1,954
  2,183
  2,425
  2,679
  2,945
  3,222
  3,512
  3,813
  4,127
  4,453
  4,793
  5,145
  5,511
  5,892
  6,287
  6,699
  7,127
  7,572
  8,036
  8,520
  9,023
  9,548
  10,096
  10,668
  11,266
  11,890
  12,542
  13,223
  13,936
  14,683
Total liabilities and equity, $m
  5,832
  6,517
  7,239
  7,997
  8,790
  9,618
  10,483
  11,383
  12,320
  13,293
  14,307
  15,358
  16,451
  17,588
  18,768
  19,997
  21,275
  22,604
  23,989
  25,432
  26,935
  28,502
  30,138
  31,845
  33,629
  35,492
  37,438
  39,472
  41,601
  43,829
Debt-to-equity ratio
  1.010
  1.110
  1.200
  1.270
  1.340
  1.390
  1.440
  1.490
  1.520
  1.560
  1.590
  1.610
  1.640
  1.660
  1.680
  1.700
  1.720
  1.730
  1.750
  1.760
  1.770
  1.790
  1.800
  1.810
  1.820
  1.820
  1.830
  1.840
  1.850
  1.860
Adjusted equity ratio
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335
  0.335

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -887
  -1,004
  -1,128
  -1,258
  -1,395
  -1,537
  -1,686
  -1,841
  -2,002
  -2,170
  -2,291
  -2,473
  -2,661
  -2,857
  -3,060
  -3,272
  -3,492
  -3,721
  -3,959
  -4,207
  -4,466
  -4,736
  -5,017
  -5,311
  -5,618
  -5,938
  -6,273
  -6,623
  -6,989
  -7,372
Depreciation, amort., depletion, $m
  400
  441
  484
  529
  576
  625
  677
  730
  786
  844
  851
  914
  979
  1,046
  1,117
  1,190
  1,266
  1,345
  1,427
  1,513
  1,603
  1,696
  1,793
  1,895
  2,001
  2,112
  2,228
  2,349
  2,475
  2,608
Funds from operations, $m
  -487
  -563
  -644
  -729
  -819
  -912
  -1,009
  -1,111
  -1,216
  -1,326
  -1,440
  -1,559
  -1,682
  -1,810
  -1,943
  -2,082
  -2,226
  -2,376
  -2,532
  -2,694
  -2,864
  -3,040
  -3,224
  -3,416
  -3,617
  -3,827
  -4,045
  -4,274
  -4,514
  -4,764
Change in working capital, $m
  94
  100
  105
  110
  115
  121
  126
  131
  136
  142
  147
  153
  159
  165
  172
  179
  186
  194
  201
  210
  219
  228
  238
  248
  259
  271
  283
  296
  310
  324
Cash from operations, $m
  -581
  -663
  -749
  -840
  -934
  -1,032
  -1,135
  -1,242
  -1,352
  -1,468
  -1,587
  -1,712
  -1,841
  -1,976
  -2,115
  -2,261
  -2,412
  -2,569
  -2,733
  -2,904
  -3,082
  -3,268
  -3,462
  -3,665
  -3,876
  -4,098
  -4,329
  -4,571
  -4,823
  -5,088
Maintenance CAPEX, $m
  -308
  -347
  -388
  -431
  -476
  -523
  -572
  -624
  -677
  -733
  -791
  -851
  -914
  -979
  -1,046
  -1,117
  -1,190
  -1,266
  -1,345
  -1,427
  -1,513
  -1,603
  -1,696
  -1,793
  -1,895
  -2,001
  -2,112
  -2,228
  -2,349
  -2,475
New CAPEX, $m
  -386
  -408
  -429
  -451
  -472
  -493
  -514
  -536
  -557
  -580
  -602
  -626
  -650
  -676
  -703
  -731
  -760
  -791
  -824
  -858
  -895
  -933
  -973
  -1,016
  -1,061
  -1,108
  -1,158
  -1,211
  -1,267
  -1,325
Cash from investing activities, $m
  -694
  -755
  -817
  -882
  -948
  -1,016
  -1,086
  -1,160
  -1,234
  -1,313
  -1,393
  -1,477
  -1,564
  -1,655
  -1,749
  -1,848
  -1,950
  -2,057
  -2,169
  -2,285
  -2,408
  -2,536
  -2,669
  -2,809
  -2,956
  -3,109
  -3,270
  -3,439
  -3,616
  -3,800
Free cash flow, $m
  -1,275
  -1,418
  -1,567
  -1,721
  -1,882
  -2,049
  -2,222
  -2,401
  -2,587
  -2,780
  -2,981
  -3,189
  -3,405
  -3,630
  -3,864
  -4,108
  -4,362
  -4,626
  -4,902
  -5,190
  -5,490
  -5,804
  -6,131
  -6,474
  -6,832
  -7,207
  -7,599
  -8,009
  -8,439
  -8,889
Issuance/(repayment) of debt, $m
  432
  456
  480
  504
  528
  551
  575
  599
  623
  648
  673
  700
  727
  756
  785
  817
  850
  884
  921
  959
  1,000
  1,043
  1,088
  1,135
  1,186
  1,239
  1,294
  1,353
  1,416
  1,481
Issuance/(repurchase) of shares, $m
  1,101
  1,234
  1,370
  1,512
  1,660
  1,815
  1,976
  2,143
  2,316
  2,496
  2,630
  2,825
  3,027
  3,237
  3,456
  3,683
  3,920
  4,166
  4,423
  4,691
  4,970
  5,261
  5,565
  5,883
  6,215
  6,562
  6,925
  7,305
  7,702
  8,118
Cash from financing (excl. dividends), $m  
  1,533
  1,690
  1,850
  2,016
  2,188
  2,366
  2,551
  2,742
  2,939
  3,144
  3,303
  3,525
  3,754
  3,993
  4,241
  4,500
  4,770
  5,050
  5,344
  5,650
  5,970
  6,304
  6,653
  7,018
  7,401
  7,801
  8,219
  8,658
  9,118
  9,599
Total cash flow (excl. dividends), $m
  258
  272
  283
  295
  306
  317
  329
  340
  352
  364
  323
  336
  349
  362
  377
  392
  408
  424
  442
  460
  480
  500
  522
  545
  569
  594
  621
  649
  679
  710
Retained Cash Flow (-), $m
  -1,101
  -1,234
  -1,370
  -1,512
  -1,660
  -1,815
  -1,976
  -2,143
  -2,316
  -2,496
  -2,630
  -2,825
  -3,027
  -3,237
  -3,456
  -3,683
  -3,920
  -4,166
  -4,423
  -4,691
  -4,970
  -5,261
  -5,565
  -5,883
  -6,215
  -6,562
  -6,925
  -7,305
  -7,702
  -8,118
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
  -844
  -962
  -1,087
  -1,217
  -1,354
  -1,497
  -1,647
  -1,802
  -1,964
  -2,133
  -2,308
  -2,489
  -2,678
  -2,875
  -3,079
  -3,291
  -3,512
  -3,742
  -3,981
  -4,231
  -4,490
  -4,761
  -5,044
  -5,339
  -5,646
  -5,968
  -6,304
  -6,656
  -7,023
  -7,408
Discount rate, %
  8.70
  9.14
  9.59
  10.07
  10.57
  11.10
  11.66
  12.24
  12.85
  13.50
  14.17
  14.88
  15.62
  16.41
  17.23
  18.09
  18.99
  19.94
  20.94
  21.98
  23.08
  24.24
  25.45
  26.72
  28.06
  29.46
  30.93
  32.48
  34.11
  35.81
PV of cash for distribution, $m
  -776
  -808
  -826
  -829
  -819
  -796
  -761
  -715
  -662
  -601
  -537
  -471
  -406
  -343
  -284
  -230
  -183
  -142
  -107
  -79
  -57
  -40
  -27
  -18
  -12
  -7
  -4
  -3
  -1
  -1
Current shareholders' claim on cash, %
  71.8
  51.6
  37.1
  26.8
  19.3
  14.0
  10.1
  7.3
  5.3
  3.9
  2.8
  2.1
  1.5
  1.1
  0.8
  0.6
  0.4
  0.3
  0.2
  0.2
  0.1
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Allegheny Technologies Incorporated is a manufacturer of specialty materials and complex components. The Company operates through two business segments: High Performance Materials & Components (HPMC), and Flat Rolled Products (FRP). The HPMC segment produces, converts and distributes a range of materials, including titanium and titanium-based alloys, nickel- and cobalt-based alloys and superalloys, zirconium and related alloys, including hafnium and niobium, advanced powder alloys and other specialty materials, in long product forms, such as ingot, billet, bar, rod, wire, shapes and rectangles, and seamless tubes, plus precision forgings, castings, components and machined parts. The FRP segment produces, converts and distributes stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys, in a range of product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products.

FINANCIAL RATIOS  of  Allegheny Technologies (ATI)

Valuation Ratios
P/E Ratio -4.4
Price to Sales 0.9
Price to Book 2.1
Price to Tangible Book
Price to Cash Flow -63.6
Price to Free Cash Flow -11.4
Growth Rates
Sales Growth Rate -15.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 39.3%
Cap. Spend. - 3 Yr. Gr. Rate -19.9%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 130.8%
Total Debt to Equity 138.5%
Interest Coverage -5
Management Effectiveness
Return On Assets -9.8%
Ret/ On Assets - 3 Yr. Avg. -2%
Return On Total Capital -18.8%
Ret/ On T. Cap. - 3 Yr. Avg. -9.6%
Return On Equity -37.3%
Return On Equity - 3 Yr. Avg. -17.8%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 5.2%
Gross Margin - 3 Yr. Avg. 5.2%
EBITDA Margin -13.9%
EBITDA Margin - 3 Yr. Avg. -3.9%
Operating Margin -19.5%
Oper. Margin - 3 Yr. Avg. -9%
Pre-Tax Margin -23.4%
Pre-Tax Margin - 3 Yr. Avg. -12.1%
Net Profit Margin -20.4%
Net Profit Margin - 3 Yr. Avg. -10.2%
Effective Tax Rate 14.6%
Eff/ Tax Rate - 3 Yr. Avg. -120.7%
Payout Ratio -4.1%

ATI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ATI stock intrinsic value calculation we used $3525 million for the last fiscal year's total revenue generated by Allegheny Technologies. The default revenue input number comes from 2017 income statement of Allegheny Technologies. 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 ATI stock valuation model: a) initial revenue growth rate of 12.5% 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 8.7%, whose default value for ATI is calculated based on our internal credit rating of Allegheny Technologies, 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 Allegheny Technologies.
    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 ATI stock the variable cost ratio is equal to 119.5%.

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 ATI 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 7.8% for Allegheny Technologies.

Corporate tax rate of 27% is the nominal tax rate for Allegheny Technologies. 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 ATI 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 ATI are equal to 87.5%.

Life of production assets of 10 years is the average useful life of capital assets used in Allegheny Technologies 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 ATI is equal to 21.4%. 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 - $1739 million for Allegheny Technologies - 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 109 million for Allegheny Technologies 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 Allegheny Technologies at the current share price and the inputted number of shares is $2.8 billion.

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COMPANY NEWS

▶ Harshman to retire as ATI CEO   [Aug-14-18 11:55AM  American City Business Journals]
▶ ATI Announces CEO Succession Plan   [07:15AM  Business Wire]
▶ 3 Top Mid-Cap Stocks to Buy Right Now   [Aug-13-18 06:31AM  Motley Fool]
▶ [$$] Many Manufacturers Take Tariffs in Stride   [08:05PM  The Wall Street Journal]
▶ [$$] Many Manufacturers Take Tariffs in Stride   [01:55PM  The Wall Street Journal]
▶ Allegheny Technologies: 2Q Earnings Snapshot   [07:24AM  Associated Press]
▶ ATI Announces Second Quarter 2018 Results   [07:15AM  Business Wire]
▶ ATI acquires aerospace and defense additive manufacturer   [08:34AM  American City Business Journals]
▶ Business, civic leaders sign pledge against sexual violence   [Jun-14-18 05:01PM  American City Business Journals]
▶ ATI Announces Treasury Leadership Transition   [Jun-04-18 04:30PM  Business Wire]
▶ Allegheny Technologies: 1Q Earnings Snapshot   [07:47AM  Associated Press]
▶ ATI Announces First Quarter 2018 Results   [07:30AM  Business Wire]
▶ Why This Rising Star in U.S. Manufacturing Is a Buy   [Mar-28-18 12:02PM  Motley Fool]
▶ ATI to Expand Aerospace Iso-Thermal Forging Capacity   [Mar-22-18 11:00AM  Business Wire]
▶ Five Steel Stocks to Buy Now   [12:46AM  Insider Monkey]
▶ [$$] Democrats see hopeful signs in Pennsylvania   [Mar-14-18 02:18AM  Financial Times]
▶ ATI and Tsingshan Announce Formation of Joint Venture   [Mar-01-18 08:30AM  Business Wire]
▶ ATI Elects New Director   [08:30AM  Business Wire]
▶ [$$] When algorithms reinforce inequality   [Feb-09-18 06:03AM  Financial Times]
▶ Alan Fournier: Building on the Lessons of David Tepper   [Jan-29-18 03:22PM  GuruFocus.com]
▶ Company News For Jan 24, 2018   [10:04AM  Zacks]
▶ 4 Stocks to Watch Tuesday   [Jan-23-18 03:18PM  GuruFocus.com]
▶ Allegheny Technologies beats Street 4Q forecasts   [07:59AM  Associated Press]
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