Intrinsic value of Activision Blizzard - ATVI

Previous Close

$62.43

  Intrinsic Value

$48.42

stock screener

  Rating & Target

sell

-22%

Previous close

$62.43

 
Intrinsic value

$48.42

 
Up/down potential

-22%

 
Rating

sell

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of ATVI 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 2016), $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 47.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   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

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  41.68
  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
  4.90
  4.91
  4.92
  4.93
  4.94
  4.94
  4.95
Revenue, $m
  6,608
  6,866
  7,141
  7,434
  7,747
  8,078
  8,429
  8,802
  9,195
  9,612
  10,051
  10,515
  11,005
  11,521
  12,065
  12,637
  13,241
  13,876
  14,544
  15,247
  15,987
  16,765
  17,583
  18,443
  19,347
  20,298
  21,297
  22,346
  23,449
  24,608
  25,826
Variable operating expenses, $m
 
  4,885
  5,041
  5,208
  5,386
  5,575
  5,775
  5,986
  6,211
  6,448
  6,698
  5,985
  6,264
  6,557
  6,867
  7,193
  7,536
  7,898
  8,278
  8,678
  9,099
  9,542
  10,008
  10,497
  11,012
  11,553
  12,122
  12,719
  13,347
  14,006
  14,700
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
  5,288
  4,885
  5,041
  5,208
  5,386
  5,575
  5,775
  5,986
  6,211
  6,448
  6,698
  5,985
  6,264
  6,557
  6,867
  7,193
  7,536
  7,898
  8,278
  8,678
  9,099
  9,542
  10,008
  10,497
  11,012
  11,553
  12,122
  12,719
  13,347
  14,006
  14,700
Operating income, $m
  1,320
  1,981
  2,100
  2,226
  2,361
  2,503
  2,655
  2,815
  2,985
  3,164
  3,353
  4,530
  4,741
  4,963
  5,198
  5,444
  5,704
  5,978
  6,266
  6,569
  6,888
  7,223
  7,575
  7,946
  8,335
  8,745
  9,175
  9,627
  10,102
  10,602
  11,126
EBITDA, $m
  2,470
  3,117
  3,242
  3,375
  3,517
  3,667
  3,827
  3,996
  4,175
  4,364
  4,563
  4,774
  4,996
  5,230
  5,477
  5,737
  6,011
  6,300
  6,603
  6,922
  7,258
  7,611
  7,983
  8,373
  8,784
  9,215
  9,669
  10,145
  10,646
  11,172
  11,725
Interest expense (income), $m
  209
  230
  245
  262
  279
  298
  317
  338
  360
  384
  408
  434
  462
  491
  522
  554
  588
  624
  661
  701
  743
  787
  833
  881
  932
  986
  1,042
  1,102
  1,164
  1,229
  1,298
Earnings before tax, $m
  1,106
  1,751
  1,854
  1,964
  2,081
  2,206
  2,337
  2,477
  2,625
  2,780
  2,945
  4,096
  4,279
  4,472
  4,676
  4,891
  5,117
  5,354
  5,605
  5,868
  6,145
  6,436
  6,742
  7,064
  7,403
  7,759
  8,133
  8,526
  8,939
  9,372
  9,828
Tax expense, $m
  140
  473
  501
  530
  562
  596
  631
  669
  709
  751
  795
  1,106
  1,155
  1,208
  1,263
  1,320
  1,381
  1,446
  1,513
  1,584
  1,659
  1,738
  1,820
  1,907
  1,999
  2,095
  2,196
  2,302
  2,413
  2,531
  2,654
Net income, $m
  966
  1,279
  1,354
  1,434
  1,519
  1,610
  1,706
  1,808
  1,916
  2,030
  2,150
  2,990
  3,124
  3,265
  3,414
  3,570
  3,735
  3,909
  4,091
  4,284
  4,486
  4,698
  4,922
  5,157
  5,404
  5,664
  5,937
  6,224
  6,525
  6,842
  7,175

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  3,245
  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
  17,452
  14,765
  15,357
  15,988
  16,659
  17,372
  18,128
  18,928
  19,775
  20,670
  21,616
  22,613
  23,666
  24,776
  25,945
  27,177
  28,475
  29,840
  31,278
  32,790
  34,381
  36,054
  37,813
  39,663
  41,607
  43,651
  45,799
  48,056
  50,428
  52,921
  55,539
Adjusted assets (=assets-cash), $m
  14,207
  14,765
  15,357
  15,988
  16,659
  17,372
  18,128
  18,928
  19,775
  20,670
  21,616
  22,613
  23,666
  24,776
  25,945
  27,177
  28,475
  29,840
  31,278
  32,790
  34,381
  36,054
  37,813
  39,663
  41,607
  43,651
  45,799
  48,056
  50,428
  52,921
  55,539
Revenue / Adjusted assets
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
  0.465
Average production assets, $m
  1,299
  1,353
  1,407
  1,465
  1,526
  1,591
  1,661
  1,734
  1,811
  1,893
  1,980
  2,072
  2,168
  2,270
  2,377
  2,490
  2,608
  2,734
  2,865
  3,004
  3,149
  3,303
  3,464
  3,633
  3,811
  3,999
  4,195
  4,402
  4,619
  4,848
  5,088
Working capital, $m
  2,174
  -1,112
  -1,157
  -1,204
  -1,255
  -1,309
  -1,366
  -1,426
  -1,490
  -1,557
  -1,628
  -1,703
  -1,783
  -1,866
  -1,954
  -2,047
  -2,145
  -2,248
  -2,356
  -2,470
  -2,590
  -2,716
  -2,848
  -2,988
  -3,134
  -3,288
  -3,450
  -3,620
  -3,799
  -3,987
  -4,184
Total debt, $m
  4,887
  5,221
  5,569
  5,939
  6,333
  6,751
  7,195
  7,665
  8,162
  8,687
  9,242
  9,828
  10,446
  11,097
  11,784
  12,507
  13,269
  14,070
  14,914
  15,802
  16,735
  17,717
  18,750
  19,836
  20,977
  22,177
  23,438
  24,763
  26,155
  27,619
  29,156
Total liabilities, $m
  8,333
  8,667
  9,015
  9,385
  9,779
  10,197
  10,641
  11,111
  11,608
  12,133
  12,688
  13,274
  13,892
  14,543
  15,230
  15,953
  16,715
  17,516
  18,360
  19,248
  20,181
  21,163
  22,196
  23,282
  24,423
  25,623
  26,884
  28,209
  29,601
  31,065
  32,602
Total equity, $m
  9,119
  6,098
  6,342
  6,603
  6,880
  7,175
  7,487
  7,817
  8,167
  8,537
  8,927
  9,339
  9,774
  10,232
  10,715
  11,224
  11,760
  12,324
  12,918
  13,542
  14,199
  14,890
  15,617
  16,381
  17,184
  18,028
  18,915
  19,847
  20,827
  21,856
  22,938
Total liabilities and equity, $m
  17,452
  14,765
  15,357
  15,988
  16,659
  17,372
  18,128
  18,928
  19,775
  20,670
  21,615
  22,613
  23,666
  24,775
  25,945
  27,177
  28,475
  29,840
  31,278
  32,790
  34,380
  36,053
  37,813
  39,663
  41,607
  43,651
  45,799
  48,056
  50,428
  52,921
  55,540
Debt-to-equity ratio
  0.536
  0.860
  0.880
  0.900
  0.920
  0.940
  0.960
  0.980
  1.000
  1.020
  1.040
  1.050
  1.070
  1.080
  1.100
  1.110
  1.130
  1.140
  1.150
  1.170
  1.180
  1.190
  1.200
  1.210
  1.220
  1.230
  1.240
  1.250
  1.260
  1.260
  1.270
Adjusted equity ratio
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413
  0.413

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  966
  1,279
  1,354
  1,434
  1,519
  1,610
  1,706
  1,808
  1,916
  2,030
  2,150
  2,990
  3,124
  3,265
  3,414
  3,570
  3,735
  3,909
  4,091
  4,284
  4,486
  4,698
  4,922
  5,157
  5,404
  5,664
  5,937
  6,224
  6,525
  6,842
  7,175
Depreciation, amort., depletion, $m
  1,150
  1,136
  1,142
  1,149
  1,156
  1,164
  1,172
  1,181
  1,190
  1,200
  1,210
  244
  255
  267
  280
  293
  307
  322
  337
  353
  371
  389
  408
  427
  448
  470
  494
  518
  543
  570
  599
Funds from operations, $m
  1,897
  2,414
  2,496
  2,583
  2,676
  2,774
  2,879
  2,989
  3,106
  3,229
  3,360
  3,234
  3,379
  3,532
  3,693
  3,863
  4,042
  4,230
  4,428
  4,637
  4,856
  5,087
  5,329
  5,584
  5,853
  6,134
  6,430
  6,742
  7,069
  7,412
  7,773
Change in working capital, $m
  -258
  -42
  -45
  -48
  -51
  -54
  -57
  -60
  -64
  -67
  -71
  -75
  -79
  -84
  -88
  -93
  -98
  -103
  -108
  -114
  -120
  -126
  -133
  -139
  -146
  -154
  -162
  -170
  -179
  -188
  -197
Cash from operations, $m
  2,155
  2,456
  2,541
  2,631
  2,726
  2,828
  2,935
  3,049
  3,170
  3,297
  3,431
  3,309
  3,458
  3,615
  3,781
  3,956
  4,140
  4,333
  4,537
  4,751
  4,976
  5,213
  5,462
  5,724
  5,999
  6,288
  6,592
  6,912
  7,247
  7,600
  7,970
Maintenance CAPEX, $m
  0
  -153
  -159
  -166
  -172
  -180
  -187
  -195
  -204
  -213
  -223
  -233
  -244
  -255
  -267
  -280
  -293
  -307
  -322
  -337
  -353
  -371
  -389
  -408
  -427
  -448
  -470
  -494
  -518
  -543
  -570
New CAPEX, $m
  -136
  -54
  -54
  -58
  -61
  -65
  -69
  -73
  -78
  -82
  -87
  -91
  -96
  -102
  -107
  -113
  -119
  -125
  -132
  -139
  -146
  -153
  -161
  -169
  -178
  -187
  -197
  -207
  -217
  -228
  -240
Cash from investing activities, $m
  -1,177
  -207
  -213
  -224
  -233
  -245
  -256
  -268
  -282
  -295
  -310
  -324
  -340
  -357
  -374
  -393
  -412
  -432
  -454
  -476
  -499
  -524
  -550
  -577
  -605
  -635
  -667
  -701
  -735
  -771
  -810
Free cash flow, $m
  978
  2,250
  2,327
  2,407
  2,493
  2,583
  2,679
  2,781
  2,888
  3,002
  3,122
  2,984
  3,118
  3,259
  3,407
  3,563
  3,728
  3,901
  4,083
  4,275
  4,477
  4,689
  4,912
  5,147
  5,393
  5,653
  5,925
  6,211
  6,512
  6,828
  7,160
Issuance/(repayment) of debt, $m
  711
  334
  348
  370
  394
  418
  444
  470
  497
  525
  555
  586
  618
  651
  687
  723
  762
  802
  844
  888
  934
  982
  1,033
  1,086
  1,141
  1,200
  1,261
  1,325
  1,392
  1,463
  1,537
Issuance/(repurchase) of shares, $m
  106
  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  
  695
  334
  348
  370
  394
  418
  444
  470
  497
  525
  555
  586
  618
  651
  687
  723
  762
  802
  844
  888
  934
  982
  1,033
  1,086
  1,141
  1,200
  1,261
  1,325
  1,392
  1,463
  1,537
Total cash flow (excl. dividends), $m
  1,617
  2,584
  2,675
  2,778
  2,887
  3,001
  3,123
  3,250
  3,385
  3,527
  3,677
  3,570
  3,736
  3,910
  4,094
  4,287
  4,489
  4,703
  4,927
  5,163
  5,411
  5,671
  5,945
  6,233
  6,535
  6,852
  7,186
  7,536
  7,905
  8,291
  8,697
Retained Cash Flow (-), $m
  -1,051
  -224
  -245
  -261
  -277
  -294
  -312
  -331
  -350
  -370
  -390
  -412
  -435
  -458
  -483
  -509
  -536
  -564
  -594
  -625
  -657
  -691
  -727
  -764
  -803
  -844
  -887
  -932
  -980
  -1,029
  -1,081
Prev. year cash balance distribution, $m
 
  3,245
  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
 
  5,605
  2,430
  2,517
  2,609
  2,707
  2,810
  2,920
  3,035
  3,157
  3,286
  3,158
  3,301
  3,452
  3,611
  3,778
  3,954
  4,139
  4,334
  4,538
  4,754
  4,980
  5,218
  5,469
  5,732
  6,008
  6,299
  6,604
  6,925
  7,262
  7,616
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
 
  5,374
  2,225
  2,191
  2,149
  2,098
  2,040
  1,973
  1,897
  1,814
  1,723
  1,500
  1,409
  1,312
  1,212
  1,109
  1,005
  901
  798
  699
  604
  515
  433
  358
  292
  234
  184
  142
  107
  79
  57
Current shareholders' claim on cash, %
  100
  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

Activision Blizzard, Inc. is a developer and publisher of interactive entertainment content and services. The Company develops and distributes content and services across various gaming platforms, including video game consoles, personal computers (PC) and mobile devices. Its segments include Activision Publishing, Inc. (Activision), Blizzard Entertainment, Inc. (Blizzard), King Digital Entertainment (King) and Other. Activision is a developer and publisher of interactive software products and content. Blizzard is engaged in developing and publishing of interactive software products and entertainment content, particularly in PC gaming. King is a mobile entertainment company. It is engaged in other businesses, including The Major League Gaming (MLG) business; The Activision Blizzard Studios (Studios) business, and The Activision Blizzard Distribution (Distribution) business. It also develops products spanning other genres, including action/adventure, role-playing and simulation.

FINANCIAL RATIOS  of  Activision Blizzard (ATVI)

Valuation Ratios
P/E Ratio 48.2
Price to Sales 7
Price to Book 5.1
Price to Tangible Book
Price to Cash Flow 21.6
Price to Free Cash Flow 23.1
Growth Rates
Sales Growth Rate 41.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 22.5%
Cap. Spend. - 3 Yr. Gr. Rate 12.9%
Financial Strength
Quick Ratio NaN
Current Ratio 0.3
LT Debt to Equity 53.6%
Total Debt to Equity 53.6%
Interest Coverage 6
Management Effectiveness
Return On Assets 7%
Ret/ On Assets - 3 Yr. Avg. 7%
Return On Total Capital 7.4%
Ret/ On T. Cap. - 3 Yr. Avg. 7.4%
Return On Equity 11.2%
Return On Equity - 3 Yr. Avg. 11.7%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 63.8%
Gross Margin - 3 Yr. Avg. 65.1%
EBITDA Margin 37.3%
EBITDA Margin - 3 Yr. Avg. 36.9%
Operating Margin 20%
Oper. Margin - 3 Yr. Avg. 25%
Pre-Tax Margin 16.7%
Pre-Tax Margin - 3 Yr. Avg. 21%
Net Profit Margin 14.6%
Net Profit Margin - 3 Yr. Avg. 17.6%
Effective Tax Rate 12.7%
Eff/ Tax Rate - 3 Yr. Avg. 16%
Payout Ratio 20.2%

ATVI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ATVI stock intrinsic value calculation we used $6608 million for the last fiscal year's total revenue generated by Activision Blizzard. The default revenue input number comes from 2016 income statement of Activision Blizzard. 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 ATVI stock valuation model: a) initial revenue growth rate of 3.9% 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 4.3%, whose default value for ATVI is calculated based on our internal credit rating of Activision Blizzard, 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 Activision Blizzard.
    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 ATVI 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 ATVI 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 4.7% for Activision Blizzard.

Corporate tax rate of 27% is the nominal tax rate for Activision Blizzard. 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 ATVI 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 ATVI are equal to 19.7%.

Life of production assets of 8.5 years is the average useful life of capital assets used in Activision Blizzard 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 ATVI is equal to -16.2%. 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 - $9119 million for Activision Blizzard - 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 754.91 million for Activision Blizzard 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 Activision Blizzard at the current share price and the inputted number of shares is $47.1 billion.

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Financial statements of ATVI
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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