Intrinsic value of Bill Barrett - BBG

Previous Close

$5.17

  Intrinsic Value

$1.87

stock screener

  Rating & Target

str. sell

-64%

Previous close

$5.17

 
Intrinsic value

$1.87

 
Up/down potential

-64%

 
Rating

str. sell

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

We calculate the intrinsic value of BBG 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

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

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, %
  -13.94
  36.00
  32.90
  30.11
  27.60
  25.34
  23.31
  21.47
  19.83
  18.34
  17.01
  15.81
  14.73
  13.76
  12.88
  12.09
  11.38
  10.74
  10.17
  9.65
  9.19
  8.77
  8.39
  8.05
  7.75
  7.47
  7.23
  7.00
  6.80
  6.62
  6.46
Revenue, $m
  179
  243
  324
  421
  537
  673
  830
  1,008
  1,208
  1,430
  1,673
  1,938
  2,223
  2,529
  2,855
  3,200
  3,564
  3,947
  4,348
  4,768
  5,206
  5,663
  6,138
  6,632
  7,146
  7,680
  8,235
  8,812
  9,411
  10,034
  10,683
Variable operating expenses, $m
 
  1,067
  1,419
  1,846
  2,355
  2,952
  3,640
  4,422
  5,299
  6,270
  7,337
  8,497
  9,748
  11,089
  12,518
  14,031
  15,628
  17,308
  19,068
  20,908
  22,829
  24,831
  26,915
  29,083
  31,336
  33,677
  36,111
  38,640
  41,268
  44,001
  46,843
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
  269
  1,067
  1,419
  1,846
  2,355
  2,952
  3,640
  4,422
  5,299
  6,270
  7,337
  8,497
  9,748
  11,089
  12,518
  14,031
  15,628
  17,308
  19,068
  20,908
  22,829
  24,831
  26,915
  29,083
  31,336
  33,677
  36,111
  38,640
  41,268
  44,001
  46,843
Operating income, $m
  -91
  -824
  -1,095
  -1,425
  -1,818
  -2,279
  -2,810
  -3,413
  -4,090
  -4,841
  -5,664
  -6,559
  -7,525
  -8,560
  -9,663
  -10,831
  -12,064
  -13,361
  -14,719
  -16,140
  -17,623
  -19,169
  -20,777
  -22,450
  -24,190
  -25,997
  -27,876
  -29,828
  -31,857
  -33,967
  -36,161
EBITDA, $m
  81
  -591
  -785
  -1,021
  -1,303
  -1,633
  -2,014
  -2,446
  -2,931
  -3,469
  -4,059
  -4,701
  -5,393
  -6,135
  -6,925
  -7,762
  -8,646
  -9,575
  -10,548
  -11,566
  -12,629
  -13,737
  -14,889
  -16,088
  -17,335
  -18,630
  -19,976
  -21,375
  -22,829
  -24,341
  -25,914
Interest expense (income), $m
  58
  55
  78
  106
  140
  181
  228
  283
  346
  416
  494
  579
  672
  772
  879
  993
  1,114
  1,242
  1,376
  1,517
  1,664
  1,817
  1,977
  2,144
  2,317
  2,497
  2,685
  2,879
  3,081
  3,291
  3,510
Earnings before tax, $m
  -170
  -879
  -1,173
  -1,531
  -1,958
  -2,459
  -3,038
  -3,697
  -4,436
  -5,256
  -6,157
  -7,138
  -8,197
  -9,332
  -10,542
  -11,824
  -13,178
  -14,602
  -16,095
  -17,657
  -19,287
  -20,986
  -22,755
  -24,594
  -26,507
  -28,495
  -30,560
  -32,707
  -34,938
  -37,258
  -39,671
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
  0
Net income, $m
  -170
  -879
  -1,173
  -1,531
  -1,958
  -2,459
  -3,038
  -3,697
  -4,436
  -5,256
  -6,157
  -7,138
  -8,197
  -9,332
  -10,542
  -11,824
  -13,178
  -14,602
  -16,095
  -17,657
  -19,287
  -20,986
  -22,755
  -24,594
  -26,507
  -28,495
  -30,560
  -32,707
  -34,938
  -37,258
  -39,671

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  276
  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
  1,385
  1,512
  2,010
  2,615
  3,336
  4,182
  5,156
  6,263
  7,505
  8,882
  10,393
  12,036
  13,808
  15,708
  17,731
  19,875
  22,137
  24,516
  27,009
  29,616
  32,337
  35,173
  38,124
  41,194
  44,386
  47,703
  51,149
  54,731
  58,455
  62,326
  66,352
Adjusted assets (=assets-cash), $m
  1,109
  1,512
  2,010
  2,615
  3,336
  4,182
  5,156
  6,263
  7,505
  8,882
  10,393
  12,036
  13,808
  15,708
  17,731
  19,875
  22,137
  24,516
  27,009
  29,616
  32,337
  35,173
  38,124
  41,194
  44,386
  47,703
  51,149
  54,731
  58,455
  62,326
  66,352
Revenue / Adjusted assets
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
  0.161
Average production assets, $m
  1,116
  1,518
  2,017
  2,625
  3,349
  4,198
  5,176
  6,287
  7,534
  8,916
  10,433
  12,082
  13,861
  15,768
  17,799
  19,951
  22,222
  24,610
  27,112
  29,730
  32,461
  35,307
  38,270
  41,352
  44,556
  47,886
  51,346
  54,941
  58,679
  62,565
  66,606
Working capital, $m
  233
  -58
  -78
  -101
  -129
  -162
  -199
  -242
  -290
  -343
  -402
  -465
  -534
  -607
  -685
  -768
  -855
  -947
  -1,044
  -1,144
  -1,250
  -1,359
  -1,473
  -1,592
  -1,715
  -1,843
  -1,976
  -2,115
  -2,259
  -2,408
  -2,564
Total debt, $m
  712
  1,007
  1,372
  1,815
  2,344
  2,964
  3,678
  4,490
  5,400
  6,409
  7,517
  8,721
  10,021
  11,413
  12,896
  14,467
  16,125
  17,869
  19,696
  21,607
  23,602
  25,680
  27,844
  30,094
  32,434
  34,865
  37,392
  40,017
  42,746
  45,584
  48,535
Total liabilities, $m
  814
  1,108
  1,473
  1,916
  2,445
  3,065
  3,779
  4,591
  5,501
  6,510
  7,618
  8,822
  10,122
  11,514
  12,997
  14,568
  16,226
  17,970
  19,797
  21,708
  23,703
  25,781
  27,945
  30,195
  32,535
  34,966
  37,493
  40,118
  42,847
  45,685
  48,636
Total equity, $m
  572
  404
  537
  698
  891
  1,116
  1,377
  1,672
  2,004
  2,371
  2,775
  3,214
  3,687
  4,194
  4,734
  5,307
  5,911
  6,546
  7,211
  7,907
  8,634
  9,391
  10,179
  10,999
  11,851
  12,737
  13,657
  14,613
  15,607
  16,641
  17,716
Total liabilities and equity, $m
  1,386
  1,512
  2,010
  2,614
  3,336
  4,181
  5,156
  6,263
  7,505
  8,881
  10,393
  12,036
  13,809
  15,708
  17,731
  19,875
  22,137
  24,516
  27,008
  29,615
  32,337
  35,172
  38,124
  41,194
  44,386
  47,703
  51,150
  54,731
  58,454
  62,326
  66,352
Debt-to-equity ratio
  1.245
  2.500
  2.560
  2.600
  2.630
  2.650
  2.670
  2.680
  2.690
  2.700
  2.710
  2.710
  2.720
  2.720
  2.720
  2.730
  2.730
  2.730
  2.730
  2.730
  2.730
  2.730
  2.740
  2.740
  2.740
  2.740
  2.740
  2.740
  2.740
  2.740
  2.740
Adjusted equity ratio
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267
  0.267

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -170
  -879
  -1,173
  -1,531
  -1,958
  -2,459
  -3,038
  -3,697
  -4,436
  -5,256
  -6,157
  -7,138
  -8,197
  -9,332
  -10,542
  -11,824
  -13,178
  -14,602
  -16,095
  -17,657
  -19,287
  -20,986
  -22,755
  -24,594
  -26,507
  -28,495
  -30,560
  -32,707
  -34,938
  -37,258
  -39,671
Depreciation, amort., depletion, $m
  172
  234
  310
  404
  515
  646
  796
  967
  1,159
  1,372
  1,605
  1,859
  2,133
  2,426
  2,738
  3,069
  3,419
  3,786
  4,171
  4,574
  4,994
  5,432
  5,888
  6,362
  6,855
  7,367
  7,899
  8,453
  9,027
  9,625
  10,247
Funds from operations, $m
  118
  -645
  -862
  -1,127
  -1,443
  -1,814
  -2,242
  -2,729
  -3,277
  -3,885
  -4,552
  -5,279
  -6,064
  -6,906
  -7,804
  -8,755
  -9,760
  -10,816
  -11,924
  -13,083
  -14,293
  -15,554
  -16,867
  -18,232
  -19,652
  -21,128
  -22,661
  -24,254
  -25,911
  -27,633
  -29,424
Change in working capital, $m
  -4
  -15
  -19
  -23
  -28
  -33
  -38
  -43
  -48
  -53
  -58
  -63
  -68
  -73
  -78
  -83
  -87
  -92
  -96
  -101
  -105
  -110
  -114
  -119
  -123
  -128
  -133
  -138
  -144
  -150
  -156
Cash from operations, $m
  122
  -630
  -843
  -1,103
  -1,415
  -1,781
  -2,204
  -2,687
  -3,229
  -3,831
  -4,494
  -5,216
  -5,996
  -6,833
  -7,725
  -8,672
  -9,672
  -10,724
  -11,828
  -12,982
  -14,188
  -15,444
  -16,753
  -18,114
  -19,529
  -20,999
  -22,528
  -24,116
  -25,767
  -27,483
  -29,268
Maintenance CAPEX, $m
  0
  -172
  -234
  -310
  -404
  -515
  -646
  -796
  -967
  -1,159
  -1,372
  -1,605
  -1,859
  -2,133
  -2,426
  -2,738
  -3,069
  -3,419
  -3,786
  -4,171
  -4,574
  -4,994
  -5,432
  -5,888
  -6,362
  -6,855
  -7,367
  -7,899
  -8,453
  -9,027
  -9,625
New CAPEX, $m
  -108
  -402
  -499
  -607
  -724
  -849
  -978
  -1,111
  -1,247
  -1,382
  -1,517
  -1,649
  -1,779
  -1,907
  -2,031
  -2,152
  -2,271
  -2,388
  -2,503
  -2,617
  -2,731
  -2,846
  -2,963
  -3,082
  -3,204
  -3,330
  -3,460
  -3,596
  -3,737
  -3,886
  -4,042
Cash from investing activities, $m
  -83
  -574
  -733
  -917
  -1,128
  -1,364
  -1,624
  -1,907
  -2,214
  -2,541
  -2,889
  -3,254
  -3,638
  -4,040
  -4,457
  -4,890
  -5,340
  -5,807
  -6,289
  -6,788
  -7,305
  -7,840
  -8,395
  -8,970
  -9,566
  -10,185
  -10,827
  -11,495
  -12,190
  -12,913
  -13,667
Free cash flow, $m
  39
  -1,203
  -1,576
  -2,021
  -2,543
  -3,145
  -3,828
  -4,594
  -5,443
  -6,373
  -7,382
  -8,470
  -9,634
  -10,872
  -12,182
  -13,563
  -15,013
  -16,531
  -18,117
  -19,771
  -21,493
  -23,285
  -25,148
  -27,083
  -29,094
  -31,184
  -33,355
  -35,611
  -37,957
  -40,397
  -42,935
Issuance/(repayment) of debt, $m
  0
  295
  365
  444
  529
  620
  714
  812
  910
  1,009
  1,107
  1,204
  1,299
  1,392
  1,483
  1,572
  1,658
  1,743
  1,828
  1,911
  1,994
  2,078
  2,164
  2,250
  2,339
  2,431
  2,526
  2,626
  2,729
  2,838
  2,951
Issuance/(repurchase) of shares, $m
  110
  987
  1,306
  1,692
  2,151
  2,685
  3,298
  3,992
  4,767
  5,624
  6,561
  7,577
  8,670
  9,839
  11,082
  12,397
  13,782
  15,237
  16,761
  18,353
  20,013
  21,743
  23,543
  25,414
  27,359
  29,380
  31,481
  33,663
  35,932
  38,292
  40,746
Cash from financing (excl. dividends), $m  
  108
  1,282
  1,671
  2,136
  2,680
  3,305
  4,012
  4,804
  5,677
  6,633
  7,668
  8,781
  9,969
  11,231
  12,565
  13,969
  15,440
  16,980
  18,589
  20,264
  22,007
  23,821
  25,707
  27,664
  29,698
  31,811
  34,007
  36,289
  38,661
  41,130
  43,697
Total cash flow (excl. dividends), $m
  147
  78
  94
  115
  137
  160
  184
  210
  235
  261
  286
  311
  335
  359
  383
  406
  428
  450
  472
  493
  515
  537
  559
  581
  604
  628
  652
  678
  705
  733
  762
Retained Cash Flow (-), $m
  -23
  -987
  -1,306
  -1,692
  -2,151
  -2,685
  -3,298
  -3,992
  -4,767
  -5,624
  -6,561
  -7,577
  -8,670
  -9,839
  -11,082
  -12,397
  -13,782
  -15,237
  -16,761
  -18,353
  -20,013
  -21,743
  -23,543
  -25,414
  -27,359
  -29,380
  -31,481
  -33,663
  -35,932
  -38,292
  -40,746
Prev. year cash balance distribution, $m
 
  276
  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
 
  -632
  -1,211
  -1,578
  -2,014
  -2,525
  -3,114
  -3,783
  -4,532
  -5,363
  -6,275
  -7,266
  -8,335
  -9,480
  -10,699
  -11,991
  -13,354
  -14,787
  -16,289
  -17,860
  -19,499
  -21,206
  -22,984
  -24,833
  -26,755
  -28,753
  -30,828
  -32,985
  -35,228
  -37,559
  -39,984
Discount rate, %
 
  6.20
  6.51
  6.84
  7.18
  7.54
  7.91
  8.31
  8.72
  9.16
  9.62
  10.10
  10.60
  11.13
  11.69
  12.28
  12.89
  13.53
  14.21
  14.92
  15.67
  16.45
  17.27
  18.14
  19.04
  20.00
  21.00
  22.05
  23.15
  24.30
  25.52
PV of cash for distribution, $m
 
  -595
  -1,068
  -1,294
  -1,526
  -1,756
  -1,972
  -2,164
  -2,321
  -2,437
  -2,505
  -2,522
  -2,487
  -2,403
  -2,276
  -2,111
  -1,919
  -1,709
  -1,490
  -1,271
  -1,061
  -866
  -690
  -537
  -408
  -302
  -217
  -152
  -104
  -68
  -44
Current shareholders' claim on cash, %
  100
  17.4
  3.1
  0.6
  0.1
  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
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Bill Barrett Corporation is an independent energy company that develops, acquires and explores for oil and natural gas resources. The Company's assets and operations are located in the Rocky Mountain region of the United States. It has over two areas of production: The Denver-Julesburg Basin (DJ Basin) and the Uinta Oil Program in the Uinta Basin. Its acreage positions in the DJ Basin are located in Colorado's eastern plains and parts of southeastern Wyoming. It had interests in 299 gross producing wells and served as an operator in 202 gross wells, as of December 31, 2016. The Uinta Basin is located in northeastern Utah. Uinta Basin's estimated proved reserves are 21.4 million barrels of oil equivalent (MMBoe). Uinta Basin has interests in approximately 240 gross producing wells. The Company serves as an operator in over 170 gross wells. The Uinta Oil Program includes over three areas of development located in the basin referred as Blacktail Ridge, Lake Canyon and East Bluebell.

FINANCIAL RATIOS  of  Bill Barrett (BBG)

Valuation Ratios
P/E Ratio -2.3
Price to Sales 2.2
Price to Book 0.7
Price to Tangible Book
Price to Cash Flow 3.2
Price to Free Cash Flow 28
Growth Rates
Sales Growth Rate -13.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -66.9%
Cap. Spend. - 3 Yr. Gr. Rate -24.8%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 124.5%
Total Debt to Equity 124.5%
Interest Coverage -2
Management Effectiveness
Return On Assets -7.7%
Ret/ On Assets - 3 Yr. Avg. -9.8%
Return On Total Capital -12.9%
Ret/ On T. Cap. - 3 Yr. Avg. -14.2%
Return On Equity -30.3%
Return On Equity - 3 Yr. Avg. -30.2%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 77.1%
Gross Margin - 3 Yr. Avg. 73.9%
EBITDA Margin 33.5%
EBITDA Margin - 3 Yr. Avg. -29.1%
Operating Margin -50.3%
Oper. Margin - 3 Yr. Avg. -136.4%
Pre-Tax Margin -95%
Pre-Tax Margin - 3 Yr. Avg. -135.9%
Net Profit Margin -95%
Net Profit Margin - 3 Yr. Avg. -108.8%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 27.1%
Payout Ratio 0%

BBG stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BBG stock intrinsic value calculation we used $179 million for the last fiscal year's total revenue generated by Bill Barrett. The default revenue input number comes from 2016 income statement of Bill Barrett. 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 BBG stock valuation model: a) initial revenue growth rate of 36% 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 6.2%, whose default value for BBG is calculated based on our internal credit rating of Bill Barrett, 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 Bill Barrett.
    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 BBG stock the variable cost ratio is equal to 438.5%.

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 BBG 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 7.7% for Bill Barrett.

Corporate tax rate of 27% is the nominal tax rate for Bill Barrett. 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 BBG 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 BBG are equal to 623.5%.

Life of production assets of 6.5 years is the average useful life of capital assets used in Bill Barrett 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 BBG is equal to -24%. 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 - $572 million for Bill Barrett - 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 76.433 million for Bill Barrett 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 Bill Barrett at the current share price and the inputted number of shares is $0.4 billion.

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COMPANY NEWS

▶ Cushing Inventories Fell 33% from the Peak   [Jan-16-18 08:59AM  Market Realist]
▶ Civil Unrest in Iran Could Impact Crude Oil Prices   [Jan-04-18 09:15AM  Market Realist]
▶ US Distillate Inventories Rose for the 5th Time in 6 Weeks   [Jan-01-18 07:34AM  Market Realist]
▶ How US Gasoline and Distillate Inventories Moved Last Week   [Dec-28-17 09:50AM  Market Realist]
▶ Denver energy companies to merge in $649M deal   [03:34PM  American City Business Journals]
▶ Will US Gasoline Demand Help Crude Oil Prices This Week?   [Nov-29-17 09:30AM  Market Realist]
▶ Cushing Inventories Could Push WTI Crude Oil Futures Higher   [Nov-27-17 09:57AM  Market Realist]
▶ US Crude Oil Futures Hit July 2015 Highs   [Nov-22-17 10:45AM  Market Realist]
▶ Iraqs Production and Exports Impact Crude Oil Futures   [Nov-21-17 10:05AM  Market Realist]
▶ Bill Barrett reports 3Q loss   [Oct-31-17 04:19PM  Associated Press]
▶ Global Crude Oil Supply Outages Are near a 6-Year Low   [Oct-24-17 09:20AM  Market Realist]
▶ Do US Crude Oil Futures Look Attractive Right Now?   [Oct-23-17 12:35PM  Market Realist]
▶ Cushing Crude Oil Inventories Rose for the Fourth Week   [Sep-25-17 12:06PM  Market Realist]
▶ Distillate Inventories: More Bullish News for Oil   [Sep-21-17 01:06PM  Market Realist]
▶ Libyas Crude Oil Production Fell from a 4-Year High   [Sep-12-17 10:05AM  Market Realist]
▶ What to Watch: This Weeks Key Crude Oil Price Drivers   [Sep-11-17 03:42PM  Market Realist]
▶ Irans Crude Oil Production at 8-Year High   [Aug-22-17 11:06AM  Market Realist]
▶ What to Expect from US Gasoline Demand   [Aug-16-17 11:36AM  Market Realist]
▶ US Distillate Inventories Fell for the Fourth Straight Week   [Aug-10-17 11:35AM  Market Realist]
▶ Bill Barrett reports 2Q loss   [Aug-01-17 10:20PM  Associated Press]
▶ Global Crude Oil Supply Outages Near 5-Year Low   [Jul-26-17 10:06AM  Market Realist]
▶ Will US Crude Oil Prices Be Range-Bound this Week?   [Jul-24-17 01:10PM  Market Realist]
Financial statements of BBG
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