Intrinsic value of Atrion Corporation - ATRI

Previous Close

$794.81

  Intrinsic Value

$258.85

stock screener

  Rating & Target

str. sell

-67%

Previous close

$794.81

 
Intrinsic value

$258.85

 
Up/down potential

-67%

 
Rating

str. sell

We calculate the intrinsic value of ATRI 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 1.5

 

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, %
  2.70
  2.93
  3.14
  3.32
  3.49
  3.64
  3.78
  3.90
  4.01
  4.11
  4.20
  4.28
  4.35
  4.42
  4.47
  4.53
  4.57
  4.62
  4.65
  4.69
  4.72
  4.75
  4.77
  4.80
  4.82
  4.83
  4.85
  4.87
  4.88
  4.89
Revenue, $m
  156
  161
  166
  171
  177
  184
  191
  198
  206
  214
  223
  233
  243
  254
  265
  277
  290
  303
  317
  332
  348
  364
  382
  400
  419
  440
  461
  484
  507
  532
Variable operating expenses, $m
  112
  115
  118
  122
  126
  130
  135
  140
  145
  151
  149
  156
  162
  169
  177
  185
  194
  202
  212
  222
  232
  243
  255
  267
  280
  294
  308
  323
  339
  355
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
  112
  115
  118
  122
  126
  130
  135
  140
  145
  151
  149
  156
  162
  169
  177
  185
  194
  202
  212
  222
  232
  243
  255
  267
  280
  294
  308
  323
  339
  355
Operating income, $m
  44
  46
  48
  49
  51
  54
  56
  58
  61
  64
  74
  77
  81
  84
  88
  92
  96
  101
  105
  110
  116
  121
  127
  133
  139
  146
  153
  161
  169
  177
EBITDA, $m
  61
  62
  64
  66
  69
  71
  74
  77
  80
  83
  87
  90
  94
  99
  103
  108
  113
  118
  123
  129
  135
  141
  148
  155
  163
  171
  179
  188
  197
  206
Interest expense (income), $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  3
Earnings before tax, $m
  44
  46
  48
  49
  51
  53
  56
  58
  61
  63
  74
  77
  80
  84
  87
  91
  95
  100
  104
  109
  114
  120
  125
  131
  138
  144
  151
  158
  166
  174
Tax expense, $m
  12
  12
  13
  13
  14
  14
  15
  16
  16
  17
  20
  21
  22
  23
  24
  25
  26
  27
  28
  29
  31
  32
  34
  35
  37
  39
  41
  43
  45
  47
Net income, $m
  32
  33
  35
  36
  37
  39
  41
  42
  44
  46
  54
  56
  59
  61
  64
  67
  70
  73
  76
  80
  83
  87
  92
  96
  100
  105
  110
  116
  121
  127

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
  178
  183
  189
  195
  202
  209
  217
  225
  234
  244
  254
  265
  277
  289
  302
  315
  330
  345
  361
  378
  396
  415
  434
  455
  477
  500
  525
  550
  577
  605
Adjusted assets (=assets-cash), $m
  178
  183
  189
  195
  202
  209
  217
  225
  234
  244
  254
  265
  277
  289
  302
  315
  330
  345
  361
  378
  396
  415
  434
  455
  477
  500
  525
  550
  577
  605
Revenue / Adjusted assets
  0.876
  0.880
  0.878
  0.877
  0.876
  0.880
  0.880
  0.880
  0.880
  0.877
  0.878
  0.879
  0.877
  0.879
  0.877
  0.879
  0.879
  0.878
  0.878
  0.878
  0.879
  0.877
  0.880
  0.879
  0.878
  0.880
  0.878
  0.880
  0.879
  0.879
Average production assets, $m
  78
  81
  83
  86
  89
  92
  96
  99
  103
  108
  112
  117
  122
  127
  133
  139
  146
  152
  159
  167
  175
  183
  192
  201
  211
  221
  231
  243
  255
  267
Working capital, $m
  45
  46
  48
  49
  51
  53
  55
  57
  59
  62
  64
  67
  70
  73
  76
  80
  83
  87
  91
  95
  100
  105
  110
  115
  120
  126
  132
  139
  146
  153
Total debt, $m
  1
  1
  2
  3
  3
  4
  5
  6
  7
  8
  10
  11
  12
  14
  15
  17
  18
  20
  22
  24
  26
  28
  31
  33
  36
  39
  41
  44
  48
  51
Total liabilities, $m
  21
  22
  22
  23
  24
  25
  26
  27
  28
  29
  30
  31
  33
  34
  36
  37
  39
  41
  43
  45
  47
  49
  51
  54
  56
  59
  62
  65
  68
  71
Total equity, $m
  157
  161
  166
  172
  178
  184
  191
  199
  207
  215
  224
  234
  244
  255
  266
  278
  291
  304
  318
  333
  349
  366
  383
  402
  421
  441
  463
  485
  509
  534
Total liabilities and equity, $m
  178
  183
  188
  195
  202
  209
  217
  226
  235
  244
  254
  265
  277
  289
  302
  315
  330
  345
  361
  378
  396
  415
  434
  456
  477
  500
  525
  550
  577
  605
Debt-to-equity ratio
  0.000
  0.010
  0.010
  0.010
  0.020
  0.020
  0.030
  0.030
  0.030
  0.040
  0.040
  0.050
  0.050
  0.050
  0.060
  0.060
  0.060
  0.070
  0.070
  0.070
  0.080
  0.080
  0.080
  0.080
  0.090
  0.090
  0.090
  0.090
  0.090
  0.100
Adjusted equity ratio
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882
  0.882

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  32
  33
  35
  36
  37
  39
  41
  42
  44
  46
  54
  56
  59
  61
  64
  67
  70
  73
  76
  80
  83
  87
  92
  96
  100
  105
  110
  116
  121
  127
Depreciation, amort., depletion, $m
  16
  16
  17
  17
  17
  18
  18
  19
  19
  19
  12
  13
  14
  14
  15
  15
  16
  17
  18
  19
  19
  20
  21
  22
  23
  25
  26
  27
  28
  30
Funds from operations, $m
  49
  50
  51
  53
  55
  57
  59
  61
  63
  66
  66
  69
  72
  75
  79
  82
  86
  90
  94
  98
  103
  108
  113
  118
  124
  130
  136
  143
  150
  157
Change in working capital, $m
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  5
  5
  5
  5
  6
  6
  6
  6
  7
  7
Cash from operations, $m
  47
  49
  50
  51
  53
  55
  57
  59
  61
  63
  64
  66
  69
  72
  75
  79
  82
  86
  90
  94
  98
  103
  108
  113
  118
  124
  130
  136
  143
  150
Maintenance CAPEX, $m
  -8
  -9
  -9
  -9
  -10
  -10
  -10
  -11
  -11
  -11
  -12
  -12
  -13
  -14
  -14
  -15
  -15
  -16
  -17
  -18
  -19
  -19
  -20
  -21
  -22
  -23
  -25
  -26
  -27
  -28
New CAPEX, $m
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -9
  -9
  -10
  -10
  -11
  -11
  -12
  -12
Cash from investing activities, $m
  -10
  -11
  -12
  -12
  -13
  -13
  -13
  -15
  -15
  -15
  -17
  -17
  -18
  -19
  -20
  -21
  -21
  -23
  -24
  -25
  -27
  -27
  -29
  -30
  -32
  -33
  -36
  -37
  -39
  -40
Free cash flow, $m
  37
  38
  38
  39
  41
  42
  43
  44
  46
  48
  47
  49
  51
  53
  55
  58
  60
  63
  66
  69
  72
  75
  79
  82
  86
  90
  95
  99
  104
  109
Issuance/(repayment) of debt, $m
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
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  
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
Total cash flow (excl. dividends), $m
  38
  38
  39
  40
  41
  43
  44
  45
  47
  49
  48
  50
  52
  55
  57
  59
  62
  65
  68
  71
  74
  77
  81
  85
  89
  93
  98
  102
  107
  112
Retained Cash Flow (-), $m
  -4
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -8
  -8
  -9
  -10
  -10
  -11
  -11
  -12
  -13
  -13
  -14
  -15
  -16
  -17
  -17
  -18
  -19
  -20
  -21
  -23
  -24
  -25
Prev. year cash balance distribution, $m
  58
  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
  92
  34
  34
  35
  35
  36
  37
  38
  39
  40
  39
  41
  42
  44
  46
  47
  49
  51
  54
  56
  58
  61
  64
  67
  70
  73
  76
  80
  83
  87
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
  88
  31
  30
  29
  27
  26
  25
  24
  22
  21
  19
  17
  16
  15
  13
  12
  11
  9
  8
  7
  6
  5
  4
  3
  3
  2
  2
  1
  1
  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

Atrion Corporation (Atrion) is engaged in developing and manufacturing products, primarily for medical applications. The Company's medical products range from fluid delivery devices to ophthalmic and cardiovascular products. Its fluid delivery products include valves that promote infection control and needle safety. It has developed a range of valves designed to fill, hold and release controlled amounts of fluids or gasses on demand for use in various intubation, intravenous, catheter and other applications in areas, such as anesthesia and oncology. Its cardiovascular product, MPS2 Myocardial Protection System (MPS2), is the system used in open-heart surgery that delivers fluids and medications, mixes critical drugs and controls temperature, pressure and other variables. The Company manufactures specialized medical devices that disinfect contact lenses. Its other medical and non-medical product lines consist of instrumentation and associated disposables.

FINANCIAL RATIOS  of  Atrion Corporation (ATRI)

Valuation Ratios
P/E Ratio 51.7
Price to Sales 10.1
Price to Book 8.9
Price to Tangible Book
Price to Cash Flow 39.1
Price to Free Cash Flow 55.6
Growth Rates
Sales Growth Rate -2.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 22.2%
Cap. Spend. - 3 Yr. Gr. Rate 1.9%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 16.2%
Ret/ On Assets - 3 Yr. Avg. 16.6%
Return On Total Capital 18.2%
Ret/ On T. Cap. - 3 Yr. Avg. 18.9%
Return On Equity 18.2%
Return On Equity - 3 Yr. Avg. 18.9%
Asset Turnover 0.8
Profitability Ratios
Gross Margin 47.6%
Gross Margin - 3 Yr. Avg. 48.4%
EBITDA Margin 33.6%
EBITDA Margin - 3 Yr. Avg. 34.7%
Operating Margin 27.3%
Oper. Margin - 3 Yr. Avg. 28.6%
Pre-Tax Margin 27.3%
Pre-Tax Margin - 3 Yr. Avg. 28.4%
Net Profit Margin 19.6%
Net Profit Margin - 3 Yr. Avg. 19.8%
Effective Tax Rate 28.2%
Eff/ Tax Rate - 3 Yr. Avg. 30.3%
Payout Ratio 25%

ATRI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ATRI stock intrinsic value calculation we used $152 million for the last fiscal year's total revenue generated by Atrion Corporation. The default revenue input number comes from 0001 income statement of Atrion Corporation. 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 ATRI stock valuation model: a) initial revenue growth rate of 2.7% 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 ATRI is calculated based on our internal credit rating of Atrion Corporation, 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 Atrion Corporation.
    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 ATRI stock the variable cost ratio is equal to 71.7%.

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 ATRI 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 Atrion Corporation.

Corporate tax rate of 27% is the nominal tax rate for Atrion Corporation. 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 ATRI 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 ATRI are equal to 50.2%.

Life of production assets of 9 years is the average useful life of capital assets used in Atrion Corporation 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 ATRI is equal to 28.7%. 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 - $210.767 million for Atrion Corporation - 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 1.854 million for Atrion Corporation 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 Atrion Corporation at the current share price and the inputted number of shares is $1.5 billion.

RELATED COMPANIES Price Int.Val. Rating
STAA STAAR Surgical 30.42 19.43  sell
VUZI Vuzix Corporat 2.88 0.18  str.sell

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

Copyright © X-FIN.com 2005-2019. All rigths reserved.