Intrinsic value of Corporacion America Airports SA - CAAP

Previous Close

$8.44

  Intrinsic Value

$23.11

stock screener

  Rating & Target

str. buy

+174%

Previous close

$8.44

 
Intrinsic value

$23.11

 
Up/down potential

+174%

 
Rating

str. buy

We calculate the intrinsic value of CAAP 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 1.3

 

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, %
  15.30
  14.27
  13.34
  12.51
  11.76
  11.08
  10.47
  9.93
  9.43
  8.99
  8.59
  8.23
  7.91
  7.62
  7.36
  7.12
  6.91
  6.72
  6.55
  6.39
  6.25
  6.13
  6.01
  5.91
  5.82
  5.74
  5.67
  5.60
  5.54
  5.49
Revenue, $m
  1,816
  2,075
  2,352
  2,646
  2,957
  3,285
  3,629
  3,989
  4,366
  4,758
  5,167
  5,592
  6,035
  6,494
  6,972
  7,469
  7,985
  8,521
  9,079
  9,659
  10,263
  10,892
  11,547
  12,230
  12,942
  13,684
  14,460
  15,269
  16,115
  16,999
Variable operating expenses, $m
  1,332
  1,481
  1,641
  1,812
  1,991
  2,181
  2,380
  2,588
  2,806
  3,032
  2,987
  3,233
  3,489
  3,754
  4,030
  4,317
  4,616
  4,926
  5,248
  5,584
  5,933
  6,296
  6,675
  7,070
  7,481
  7,911
  8,359
  8,827
  9,316
  9,827
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
  1,332
  1,481
  1,641
  1,812
  1,991
  2,181
  2,380
  2,588
  2,806
  3,032
  2,987
  3,233
  3,489
  3,754
  4,030
  4,317
  4,616
  4,926
  5,248
  5,584
  5,933
  6,296
  6,675
  7,070
  7,481
  7,911
  8,359
  8,827
  9,316
  9,827
Operating income, $m
  484
  594
  711
  835
  966
  1,104
  1,249
  1,401
  1,560
  1,726
  2,180
  2,360
  2,546
  2,740
  2,942
  3,151
  3,369
  3,595
  3,831
  4,075
  4,330
  4,595
  4,872
  5,160
  5,460
  5,774
  6,101
  6,442
  6,799
  7,172
EBITDA, $m
  848
  969
  1,098
  1,236
  1,381
  1,534
  1,694
  1,863
  2,038
  2,222
  2,412
  2,611
  2,818
  3,032
  3,255
  3,487
  3,728
  3,978
  4,239
  4,510
  4,792
  5,085
  5,391
  5,710
  6,042
  6,389
  6,751
  7,129
  7,524
  7,937
Interest expense (income), $m
  0
  346
  467
  595
  732
  877
  1,031
  1,193
  1,364
  1,542
  1,728
  1,922
  2,124
  2,335
  2,554
  2,781
  3,017
  3,263
  3,518
  3,784
  4,060
  4,347
  4,645
  4,956
  5,281
  5,618
  5,970
  6,338
  6,721
  7,122
  7,540
Earnings before tax, $m
  138
  127
  116
  103
  89
  73
  56
  38
  18
  -2
  258
  235
  211
  186
  161
  134
  106
  77
  47
  16
  -16
  -50
  -85
  -121
  -158
  -197
  -237
  -279
  -323
  -368
Tax expense, $m
  37
  34
  31
  28
  24
  20
  15
  10
  5
  0
  70
  63
  57
  50
  43
  36
  29
  21
  13
  4
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  101
  93
  84
  75
  65
  53
  41
  28
  13
  -2
  188
  172
  154
  136
  117
  98
  77
  56
  34
  12
  -16
  -50
  -85
  -121
  -158
  -197
  -237
  -279
  -323
  -368

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
  4,386
  5,012
  5,681
  6,392
  7,143
  7,935
  8,766
  9,636
  10,545
  11,493
  12,481
  13,508
  14,577
  15,687
  16,841
  18,040
  19,287
  20,582
  21,929
  23,331
  24,790
  26,309
  27,891
  29,540
  31,260
  33,054
  34,927
  36,882
  38,925
  41,060
Adjusted assets (=assets-cash), $m
  4,386
  5,012
  5,681
  6,392
  7,143
  7,935
  8,766
  9,636
  10,545
  11,493
  12,481
  13,508
  14,577
  15,687
  16,841
  18,040
  19,287
  20,582
  21,929
  23,331
  24,790
  26,309
  27,891
  29,540
  31,260
  33,054
  34,927
  36,882
  38,925
  41,060
Revenue / Adjusted assets
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
  0.414
Average production assets, $m
  1,707
  1,951
  2,211
  2,487
  2,780
  3,088
  3,411
  3,750
  4,104
  4,473
  4,857
  5,257
  5,673
  6,105
  6,554
  7,021
  7,506
  8,010
  8,534
  9,080
  9,647
  10,238
  10,854
  11,496
  12,165
  12,863
  13,592
  14,353
  15,148
  15,979
Working capital, $m
  -47
  -54
  -61
  -69
  -77
  -85
  -94
  -104
  -114
  -124
  -134
  -145
  -157
  -169
  -181
  -194
  -208
  -222
  -236
  -251
  -267
  -283
  -300
  -318
  -336
  -356
  -376
  -397
  -419
  -442
Total debt, $m
  2,003
  2,553
  3,141
  3,765
  4,426
  5,122
  5,852
  6,617
  7,416
  8,250
  9,118
  10,021
  10,960
  11,936
  12,950
  14,004
  15,100
  16,239
  17,423
  18,655
  19,937
  21,272
  22,663
  24,113
  25,624
  27,201
  28,848
  30,566
  32,362
  34,239
Total liabilities, $m
  3,856
  4,406
  4,994
  5,618
  6,279
  6,975
  7,705
  8,470
  9,269
  10,103
  10,971
  11,874
  12,813
  13,789
  14,803
  15,857
  16,953
  18,092
  19,276
  20,508
  21,790
  23,125
  24,516
  25,966
  27,477
  29,054
  30,701
  32,419
  34,215
  36,092
Total equity, $m
  531
  606
  687
  773
  864
  960
  1,061
  1,166
  1,276
  1,391
  1,510
  1,634
  1,764
  1,898
  2,038
  2,183
  2,334
  2,490
  2,653
  2,823
  3,000
  3,183
  3,375
  3,574
  3,782
  4,000
  4,226
  4,463
  4,710
  4,968
Total liabilities and equity, $m
  4,387
  5,012
  5,681
  6,391
  7,143
  7,935
  8,766
  9,636
  10,545
  11,494
  12,481
  13,508
  14,577
  15,687
  16,841
  18,040
  19,287
  20,582
  21,929
  23,331
  24,790
  26,308
  27,891
  29,540
  31,259
  33,054
  34,927
  36,882
  38,925
  41,060
Debt-to-equity ratio
  3.770
  4.210
  4.570
  4.870
  5.120
  5.330
  5.520
  5.680
  5.810
  5.930
  6.040
  6.130
  6.210
  6.290
  6.360
  6.420
  6.470
  6.520
  6.570
  6.610
  6.650
  6.680
  6.720
  6.750
  6.770
  6.800
  6.830
  6.850
  6.870
  6.890
Adjusted equity ratio
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121
  0.121

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  101
  93
  84
  75
  65
  53
  41
  28
  13
  -2
  188
  172
  154
  136
  117
  98
  77
  56
  34
  12
  -16
  -50
  -85
  -121
  -158
  -197
  -237
  -279
  -323
  -368
Depreciation, amort., depletion, $m
  363
  375
  388
  401
  415
  430
  445
  461
  478
  496
  232
  252
  271
  292
  314
  336
  359
  383
  408
  434
  462
  490
  519
  550
  582
  615
  650
  687
  725
  765
Funds from operations, $m
  464
  468
  472
  476
  480
  483
  486
  489
  492
  494
  421
  423
  426
  428
  431
  434
  436
  439
  443
  446
  445
  440
  435
  429
  424
  419
  413
  408
  402
  396
Change in working capital, $m
  -6
  -7
  -7
  -8
  -8
  -9
  -9
  -9
  -10
  -10
  -11
  -11
  -11
  -12
  -12
  -13
  -13
  -14
  -15
  -15
  -16
  -16
  -17
  -18
  -19
  -19
  -20
  -21
  -22
  -23
Cash from operations, $m
  471
  475
  479
  484
  488
  491
  495
  498
  501
  504
  431
  434
  437
  440
  443
  446
  450
  453
  457
  461
  461
  456
  452
  447
  443
  438
  433
  429
  424
  419
Maintenance CAPEX, $m
  -71
  -82
  -93
  -106
  -119
  -133
  -148
  -163
  -179
  -196
  -214
  -232
  -252
  -271
  -292
  -314
  -336
  -359
  -383
  -408
  -434
  -462
  -490
  -519
  -550
  -582
  -615
  -650
  -687
  -725
New CAPEX, $m
  -226
  -244
  -260
  -277
  -292
  -308
  -323
  -339
  -354
  -369
  -384
  -400
  -416
  -432
  -449
  -467
  -485
  -504
  -524
  -545
  -568
  -591
  -616
  -642
  -669
  -698
  -729
  -761
  -795
  -831
Cash from investing activities, $m
  -297
  -326
  -353
  -383
  -411
  -441
  -471
  -502
  -533
  -565
  -598
  -632
  -668
  -703
  -741
  -781
  -821
  -863
  -907
  -953
  -1,002
  -1,053
  -1,106
  -1,161
  -1,219
  -1,280
  -1,344
  -1,411
  -1,482
  -1,556
Free cash flow, $m
  174
  149
  126
  101
  76
  50
  24
  -4
  -32
  -61
  -167
  -198
  -230
  -263
  -298
  -334
  -371
  -410
  -450
  -493
  -541
  -596
  -654
  -714
  -777
  -842
  -911
  -983
  -1,058
  -1,136
Issuance/(repayment) of debt, $m
  516
  550
  588
  625
  661
  696
  731
  765
  799
  833
  868
  903
  939
  976
  1,014
  1,054
  1,096
  1,139
  1,184
  1,232
  1,282
  1,335
  1,391
  1,450
  1,512
  1,577
  1,646
  1,719
  1,796
  1,877
Issuance/(repurchase) of shares, $m
  0
  0
  0
  11
  26
  43
  60
  78
  97
  117
  0
  0
  0
  0
  22
  47
  74
  101
  129
  158
  193
  234
  276
  320
  366
  414
  464
  516
  570
  627
Cash from financing (excl. dividends), $m  
  516
  550
  588
  636
  687
  739
  791
  843
  896
  950
  868
  903
  939
  976
  1,036
  1,101
  1,170
  1,240
  1,313
  1,390
  1,475
  1,569
  1,667
  1,770
  1,878
  1,991
  2,110
  2,235
  2,366
  2,504
Total cash flow (excl. dividends), $m
  690
  700
  714
  737
  763
  789
  814
  839
  864
  889
  701
  705
  709
  713
  739
  768
  798
  829
  863
  897
  934
  972
  1,013
  1,056
  1,101
  1,149
  1,199
  1,252
  1,308
  1,367
Retained Cash Flow (-), $m
  -69
  -76
  -81
  -86
  -91
  -96
  -101
  -105
  -110
  -117
  -119
  -124
  -129
  -134
  -140
  -145
  -151
  -157
  -163
  -170
  -193
  -234
  -276
  -320
  -366
  -414
  -464
  -516
  -570
  -627
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
  621
  624
  633
  651
  672
  693
  713
  734
  754
  772
  581
  581
  580
  578
  599
  623
  647
  673
  700
  728
  741
  739
  737
  736
  735
  735
  735
  736
  738
  740
Discount rate, %
  10.90
  11.45
  12.02
  12.62
  13.25
  13.91
  14.61
  15.34
  16.10
  16.91
  17.75
  18.64
  19.57
  20.55
  21.58
  22.66
  23.79
  24.98
  26.23
  27.54
  28.92
  30.37
  31.89
  33.48
  35.15
  36.91
  38.76
  40.69
  42.73
  44.87
PV of cash for distribution, $m
  560
  502
  450
  405
  361
  317
  275
  234
  197
  162
  96
  75
  57
  42
  32
  24
  17
  12
  8
  6
  4
  2
  1
  1
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  99.5
  98.3
  96.7
  94.7
  92.4
  89.8
  87.1
  87.1
  87.1
  87.1
  87.1
  86.7
  86.1
  85.1
  83.8
  82.4
  80.7
  78.9
  76.8
  74.6
  72.3
  69.8
  67.3
  64.7
  62.1
  59.5
  57.0

FINANCIAL RATIOS  of  Corporacion America Airports SA (CAAP)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. 0%
Return On Total Capital 0%
Ret/ On T. Cap. - 3 Yr. Avg. 0%
Return On Equity 0%
Return On Equity - 3 Yr. Avg. 0%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

CAAP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CAAP stock intrinsic value calculation we used $1575 million for the last fiscal year's total revenue generated by Corporacion America Airports SA. The default revenue input number comes from 0001 income statement of Corporacion America Airports SA. 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 CAAP stock valuation model: a) initial revenue growth rate of 15.3% 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 10.9%, whose default value for CAAP is calculated based on our internal credit rating of Corporacion America Airports SA, 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 Corporacion America Airports SA.
    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 CAAP stock the variable cost ratio is equal to 75.7%.

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 CAAP 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 23.3% for Corporacion America Airports SA.

Corporate tax rate of 27% is the nominal tax rate for Corporacion America Airports SA. 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 CAAP 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 CAAP are equal to 94%.

Life of production assets of 20.9 years is the average useful life of capital assets used in Corporacion America Airports SA 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 CAAP is equal to -2.6%. 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 - $461.783 million for Corporacion America Airports SA - 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 159.905 million for Corporacion America Airports SA 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 Corporacion America Airports SA at the current share price and the inputted number of shares is $1.3 billion.

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