Intrinsic value of BrightView Holdings, Inc. - BV

Previous Close

$18.31

  Intrinsic Value

$11.40

stock screener

  Rating & Target

sell

-38%

Previous close

$18.31

 
Intrinsic value

$11.40

 
Up/down potential

-38%

 
Rating

sell

We calculate the intrinsic value of BV 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 1.9

 

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, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  2,401
  2,456
  2,519
  2,590
  2,669
  2,755
  2,849
  2,950
  3,060
  3,177
  3,303
  3,437
  3,580
  3,731
  3,892
  4,063
  4,243
  4,434
  4,636
  4,849
  5,074
  5,311
  5,561
  5,824
  6,101
  6,393
  6,700
  7,024
  7,364
  7,722
Variable operating expenses, $m
  1,929
  1,968
  2,014
  2,065
  2,121
  2,183
  2,250
  2,323
  2,401
  2,486
  2,370
  2,466
  2,569
  2,678
  2,793
  2,916
  3,045
  3,182
  3,327
  3,480
  3,641
  3,811
  3,991
  4,179
  4,378
  4,588
  4,808
  5,040
  5,285
  5,541
Fixed operating expenses, $m
  435
  445
  455
  465
  475
  485
  496
  507
  518
  530
  541
  553
  565
  578
  590
  603
  617
  630
  644
  658
  673
  688
  703
  718
  734
  750
  767
  783
  801
  818
Total operating expenses, $m
  2,364
  2,413
  2,469
  2,530
  2,596
  2,668
  2,746
  2,830
  2,919
  3,016
  2,911
  3,019
  3,134
  3,256
  3,383
  3,519
  3,662
  3,812
  3,971
  4,138
  4,314
  4,499
  4,694
  4,897
  5,112
  5,338
  5,575
  5,823
  6,086
  6,359
Operating income, $m
  37
  43
  51
  61
  73
  87
  103
  120
  140
  162
  391
  417
  446
  476
  509
  544
  582
  622
  665
  711
  760
  812
  868
  926
  989
  1,055
  1,125
  1,200
  1,279
  1,362
EBITDA, $m
  344
  353
  363
  377
  392
  409
  429
  451
  476
  502
  531
  563
  597
  634
  674
  716
  761
  810
  862
  917
  975
  1,037
  1,103
  1,173
  1,248
  1,326
  1,409
  1,498
  1,591
  1,689
Interest expense (income), $m
  2
  82
  84
  87
  90
  94
  98
  102
  107
  112
  117
  123
  130
  136
  144
  151
  159
  168
  177
  187
  197
  207
  219
  231
  243
  256
  270
  285
  300
  317
  334
Earnings before tax, $m
  -45
  -41
  -36
  -29
  -21
  -11
  0
  14
  28
  44
  268
  288
  309
  332
  357
  385
  414
  445
  478
  514
  553
  593
  637
  683
  733
  785
  841
  900
  962
  1,028
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  4
  8
  12
  72
  78
  83
  90
  97
  104
  112
  120
  129
  139
  149
  160
  172
  184
  198
  212
  227
  243
  260
  278
Net income, $m
  -45
  -41
  -36
  -29
  -21
  -11
  0
  10
  21
  32
  196
  210
  226
  243
  261
  281
  302
  325
  349
  375
  403
  433
  465
  499
  535
  573
  614
  657
  702
  751

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
  2,950
  3,018
  3,095
  3,182
  3,279
  3,385
  3,500
  3,625
  3,759
  3,903
  4,058
  4,222
  4,398
  4,584
  4,782
  4,991
  5,213
  5,448
  5,695
  5,957
  6,233
  6,524
  6,831
  7,155
  7,495
  7,854
  8,232
  8,629
  9,047
  9,486
Adjusted assets (=assets-cash), $m
  2,950
  3,018
  3,095
  3,182
  3,279
  3,385
  3,500
  3,625
  3,759
  3,903
  4,058
  4,222
  4,398
  4,584
  4,782
  4,991
  5,213
  5,448
  5,695
  5,957
  6,233
  6,524
  6,831
  7,155
  7,495
  7,854
  8,232
  8,629
  9,047
  9,486
Revenue / Adjusted assets
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
  0.814
Average production assets, $m
  1,323
  1,353
  1,388
  1,427
  1,471
  1,518
  1,570
  1,626
  1,686
  1,751
  1,820
  1,894
  1,972
  2,056
  2,145
  2,239
  2,338
  2,443
  2,554
  2,672
  2,796
  2,926
  3,064
  3,209
  3,362
  3,523
  3,692
  3,870
  4,058
  4,255
Working capital, $m
  180
  184
  189
  194
  200
  207
  214
  221
  229
  238
  248
  258
  268
  280
  292
  305
  318
  333
  348
  364
  381
  398
  417
  437
  458
  479
  503
  527
  552
  579
Total debt, $m
  1,189
  1,228
  1,272
  1,323
  1,378
  1,439
  1,506
  1,577
  1,655
  1,738
  1,827
  1,922
  2,023
  2,130
  2,244
  2,365
  2,492
  2,627
  2,770
  2,921
  3,080
  3,248
  3,425
  3,611
  3,807
  4,014
  4,231
  4,460
  4,701
  4,954
Total liabilities, $m
  1,699
  1,738
  1,783
  1,833
  1,889
  1,949
  2,016
  2,088
  2,165
  2,248
  2,337
  2,432
  2,533
  2,640
  2,754
  2,875
  3,003
  3,138
  3,281
  3,431
  3,590
  3,758
  3,935
  4,121
  4,317
  4,524
  4,741
  4,970
  5,211
  5,464
Total equity, $m
  1,251
  1,279
  1,312
  1,349
  1,390
  1,435
  1,484
  1,537
  1,594
  1,655
  1,720
  1,790
  1,865
  1,944
  2,027
  2,116
  2,210
  2,310
  2,415
  2,526
  2,643
  2,766
  2,897
  3,034
  3,178
  3,330
  3,490
  3,659
  3,836
  4,022
Total liabilities and equity, $m
  2,950
  3,017
  3,095
  3,182
  3,279
  3,384
  3,500
  3,625
  3,759
  3,903
  4,057
  4,222
  4,398
  4,584
  4,781
  4,991
  5,213
  5,448
  5,696
  5,957
  6,233
  6,524
  6,832
  7,155
  7,495
  7,854
  8,231
  8,629
  9,047
  9,486
Debt-to-equity ratio
  0.950
  0.960
  0.970
  0.980
  0.990
  1.000
  1.010
  1.030
  1.040
  1.050
  1.060
  1.070
  1.080
  1.100
  1.110
  1.120
  1.130
  1.140
  1.150
  1.160
  1.170
  1.170
  1.180
  1.190
  1.200
  1.210
  1.210
  1.220
  1.230
  1.230
Adjusted equity ratio
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424
  0.424

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -45
  -41
  -36
  -29
  -21
  -11
  0
  10
  21
  32
  196
  210
  226
  243
  261
  281
  302
  325
  349
  375
  403
  433
  465
  499
  535
  573
  614
  657
  702
  751
Depreciation, amort., depletion, $m
  307
  310
  312
  315
  319
  322
  326
  331
  335
  340
  140
  146
  152
  158
  165
  172
  180
  188
  196
  206
  215
  225
  236
  247
  259
  271
  284
  298
  312
  327
Funds from operations, $m
  262
  268
  276
  286
  298
  311
  327
  341
  356
  373
  336
  356
  377
  401
  426
  453
  482
  513
  546
  581
  618
  658
  701
  746
  793
  844
  898
  954
  1,014
  1,078
Change in working capital, $m
  4
  4
  5
  5
  6
  6
  7
  8
  8
  9
  9
  10
  11
  11
  12
  13
  14
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  24
  26
  27
Cash from operations, $m
  259
  264
  272
  281
  292
  305
  320
  333
  348
  364
  326
  346
  367
  389
  414
  440
  468
  498
  531
  565
  602
  641
  682
  726
  773
  822
  875
  930
  989
  1,051
Maintenance CAPEX, $m
  -100
  -102
  -104
  -107
  -110
  -113
  -117
  -121
  -125
  -130
  -135
  -140
  -146
  -152
  -158
  -165
  -172
  -180
  -188
  -196
  -206
  -215
  -225
  -236
  -247
  -259
  -271
  -284
  -298
  -312
New CAPEX, $m
  -27
  -30
  -35
  -39
  -43
  -47
  -52
  -56
  -60
  -65
  -69
  -74
  -79
  -84
  -89
  -94
  -99
  -105
  -111
  -117
  -124
  -131
  -138
  -145
  -153
  -161
  -169
  -178
  -187
  -197
Cash from investing activities, $m
  -127
  -132
  -139
  -146
  -153
  -160
  -169
  -177
  -185
  -195
  -204
  -214
  -225
  -236
  -247
  -259
  -271
  -285
  -299
  -313
  -330
  -346
  -363
  -381
  -400
  -420
  -440
  -462
  -485
  -509
Free cash flow, $m
  132
  132
  133
  135
  139
  144
  151
  156
  162
  170
  122
  132
  142
  154
  167
  181
  197
  213
  232
  251
  272
  295
  319
  345
  373
  403
  434
  468
  504
  542
Issuance/(repayment) of debt, $m
  34
  39
  45
  50
  56
  61
  66
  72
  77
  83
  89
  95
  101
  107
  114
  121
  128
  135
  143
  151
  159
  168
  177
  186
  196
  207
  217
  229
  241
  253
Issuance/(repurchase) of shares, $m
  68
  70
  69
  66
  62
  56
  49
  43
  36
  29
  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  
  102
  109
  114
  116
  118
  117
  115
  115
  113
  112
  89
  95
  101
  107
  114
  121
  128
  135
  143
  151
  159
  168
  177
  186
  196
  207
  217
  229
  241
  253
Total cash flow (excl. dividends), $m
  235
  241
  246
  251
  256
  261
  266
  271
  276
  281
  211
  227
  243
  261
  281
  302
  324
  348
  374
  402
  431
  463
  496
  531
  569
  609
  652
  697
  745
  795
Retained Cash Flow (-), $m
  -68
  -70
  -69
  -66
  -62
  -56
  -49
  -53
  -57
  -61
  -65
  -70
  -74
  -79
  -84
  -89
  -94
  -99
  -105
  -111
  -117
  -123
  -130
  -137
  -144
  -152
  -160
  -168
  -177
  -186
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
  167
  171
  177
  185
  194
  205
  217
  218
  219
  220
  146
  157
  169
  182
  197
  213
  230
  249
  269
  291
  314
  339
  366
  394
  425
  457
  492
  528
  567
  609
Discount rate, %
  7.80
  8.19
  8.60
  9.03
  9.48
  9.95
  10.45
  10.98
  11.52
  12.10
  12.71
  13.34
  14.01
  14.71
  15.44
  16.22
  17.03
  17.88
  18.77
  19.71
  20.70
  21.73
  22.82
  23.96
  25.16
  26.41
  27.73
  29.12
  30.58
  32.11
PV of cash for distribution, $m
  155
  146
  138
  131
  124
  116
  108
  95
  82
  70
  39
  35
  31
  27
  23
  19
  16
  13
  10
  8
  6
  4
  3
  2
  2
  1
  1
  0
  0
  0
Current shareholders' claim on cash, %
  96.6
  93.2
  90.1
  87.3
  84.8
  82.7
  80.9
  79.4
  78.2
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4
  77.4

Bazaarvoice, Inc. offers solutions and services that allow its retailer and brand clients to understand that consumer voice and the role it plays in influencing purchasing decisions, both online and offline. The Company's solutions collect, curate and display consumer-generated content, including ratings and reviews, questions and answers, customer stories, and social posts, photos and videos. This content is syndicated and distributed across its clients' marketing channels. Its solutions, which the Company provides primarily through a software-as-a-service (SaaS) platform, enable the clients to capture and display consumer-generated content; syndicate that consumer-generated content into its network of brand and retail clients; understand consumer behavior, and monetize the value of that content through targeted advertising based on online and offline shopping behavior. The Company's geographical segments include Americas, EMEA and Other.

FINANCIAL RATIOS  of  BrightView Holdings, Inc. (BV)

Valuation Ratios
P/E Ratio -96.5
Price to Sales 7.7
Price to Book 8.3
Price to Tangible Book
Price to Cash Flow 102.9
Price to Free Cash Flow 257.2
Growth Rates
Sales Growth Rate 0.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -62.5%
Cap. Spend. - 3 Yr. Gr. Rate -2.1%
Financial Strength
Quick Ratio 3
Current Ratio 0
LT Debt to Equity 0%
Total Debt to Equity 17.2%
Interest Coverage -7
Management Effectiveness
Return On Assets -4.3%
Ret/ On Assets - 3 Yr. Avg. -7%
Return On Total Capital -7.2%
Ret/ On T. Cap. - 3 Yr. Avg. -10.9%
Return On Equity -8.6%
Return On Equity - 3 Yr. Avg. -13%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 62.2%
Gross Margin - 3 Yr. Avg. 62.3%
EBITDA Margin 0.5%
EBITDA Margin - 3 Yr. Avg. -4.8%
Operating Margin -6.5%
Oper. Margin - 3 Yr. Avg. -11.4%
Pre-Tax Margin -7.5%
Pre-Tax Margin - 3 Yr. Avg. -12.4%
Net Profit Margin -8%
Net Profit Margin - 3 Yr. Avg. -12.8%
Effective Tax Rate -6.7%
Eff/ Tax Rate - 3 Yr. Avg. -2.2%
Payout Ratio 0%

BV stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the BV stock intrinsic value calculation we used $2354 million for the last fiscal year's total revenue generated by BrightView Holdings, Inc.. The default revenue input number comes from 0001 income statement of BrightView Holdings, 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 BV stock valuation model: a) initial revenue growth rate of 2% 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 7.8%, whose default value for BV is calculated based on our internal credit rating of BrightView Holdings, 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 BrightView Holdings, 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 BV stock the variable cost ratio is equal to 80.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $426 million in the base year in the intrinsic value calculation for BV 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 7.1% for BrightView Holdings, Inc..

Corporate tax rate of 27% is the nominal tax rate for BrightView Holdings, 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 BV 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 BV are equal to 55.1%.

Life of production assets of 13 years is the average useful life of capital assets used in BrightView Holdings, 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 BV is equal to 7.5%. 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 - $1227.327 million for BrightView Holdings, 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 104.716 million for BrightView Holdings, 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 BrightView Holdings, Inc. at the current share price and the inputted number of shares is $1.9 billion.

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