Intrinsic value of Calix, Inc - CALX

Previous Close

$7.00

  Intrinsic Value

$0.17

stock screener

  Rating & Target

str. sell

-98%

Previous close

$7.00

 
Intrinsic value

$0.17

 
Up/down potential

-98%

 
Rating

str. sell

We calculate the intrinsic value of CALX 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 0.4

 

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
  450
  460
  472
  485
  500
  516
  534
  553
  573
  595
  619
  644
  671
  699
  729
  761
  795
  831
  869
  908
  951
  995
  1,042
  1,091
  1,143
  1,198
  1,255
  1,316
  1,380
  1,447
Variable operating expenses, $m
  521
  533
  546
  561
  578
  596
  616
  638
  661
  686
  701
  729
  760
  792
  826
  862
  900
  941
  984
  1,029
  1,077
  1,127
  1,180
  1,236
  1,295
  1,357
  1,422
  1,490
  1,563
  1,639
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
  521
  533
  546
  561
  578
  596
  616
  638
  661
  686
  701
  729
  760
  792
  826
  862
  900
  941
  984
  1,029
  1,077
  1,127
  1,180
  1,236
  1,295
  1,357
  1,422
  1,490
  1,563
  1,639
Operating income, $m
  -71
  -73
  -74
  -76
  -78
  -80
  -82
  -85
  -88
  -91
  -82
  -85
  -89
  -93
  -97
  -101
  -105
  -110
  -115
  -121
  -126
  -132
  -138
  -145
  -152
  -159
  -167
  -175
  -183
  -192
EBITDA, $m
  -54
  -56
  -57
  -59
  -60
  -62
  -64
  -67
  -69
  -72
  -75
  -78
  -81
  -84
  -88
  -92
  -96
  -100
  -105
  -110
  -115
  -120
  -126
  -132
  -138
  -145
  -152
  -159
  -167
  -175
Interest expense (income), $m
  0
  2
  2
  2
  2
  3
  3
  3
  3
  4
  4
  5
  5
  6
  6
  7
  7
  8
  9
  10
  10
  11
  12
  13
  14
  15
  16
  17
  18
  19
  21
Earnings before tax, $m
  -73
  -74
  -76
  -78
  -80
  -83
  -86
  -88
  -92
  -95
  -87
  -91
  -95
  -99
  -104
  -108
  -114
  -119
  -125
  -131
  -137
  -144
  -151
  -159
  -166
  -175
  -183
  -193
  -202
  -213
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
Net income, $m
  -73
  -74
  -76
  -78
  -80
  -83
  -86
  -88
  -92
  -95
  -87
  -91
  -95
  -99
  -104
  -108
  -114
  -119
  -125
  -131
  -137
  -144
  -151
  -159
  -166
  -175
  -183
  -193
  -202
  -213

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
  323
  331
  339
  349
  359
  371
  384
  397
  412
  428
  445
  463
  482
  503
  524
  547
  572
  597
  624
  653
  683
  715
  749
  784
  822
  861
  902
  946
  992
  1,040
Adjusted assets (=assets-cash), $m
  323
  331
  339
  349
  359
  371
  384
  397
  412
  428
  445
  463
  482
  503
  524
  547
  572
  597
  624
  653
  683
  715
  749
  784
  822
  861
  902
  946
  992
  1,040
Revenue / Adjusted assets
  1.393
  1.390
  1.392
  1.390
  1.393
  1.391
  1.391
  1.393
  1.391
  1.390
  1.391
  1.391
  1.392
  1.390
  1.391
  1.391
  1.390
  1.392
  1.393
  1.391
  1.392
  1.392
  1.391
  1.392
  1.391
  1.391
  1.391
  1.391
  1.391
  1.391
Average production assets, $m
  80
  82
  84
  86
  89
  92
  95
  98
  102
  106
  110
  115
  119
  124
  130
  135
  142
  148
  155
  162
  169
  177
  185
  194
  203
  213
  223
  234
  246
  257
Working capital, $m
  11
  12
  12
  12
  12
  13
  13
  14
  14
  15
  15
  16
  17
  17
  18
  19
  20
  21
  22
  23
  24
  25
  26
  27
  29
  30
  31
  33
  34
  36
Total debt, $m
  33
  37
  42
  47
  52
  58
  65
  72
  80
  88
  97
  106
  116
  127
  138
  150
  163
  176
  190
  205
  221
  238
  255
  274
  293
  313
  335
  358
  382
  407
Total liabilities, $m
  168
  172
  177
  182
  187
  193
  200
  207
  215
  223
  232
  241
  251
  262
  273
  285
  298
  311
  325
  340
  356
  373
  390
  409
  428
  449
  470
  493
  517
  542
Total equity, $m
  155
  158
  163
  167
  172
  178
  184
  190
  197
  205
  213
  222
  231
  241
  251
  262
  274
  286
  299
  313
  327
  343
  359
  376
  394
  412
  432
  453
  475
  498
Total liabilities and equity, $m
  323
  330
  340
  349
  359
  371
  384
  397
  412
  428
  445
  463
  482
  503
  524
  547
  572
  597
  624
  653
  683
  716
  749
  785
  822
  861
  902
  946
  992
  1,040
Debt-to-equity ratio
  0.220
  0.230
  0.260
  0.280
  0.300
  0.330
  0.350
  0.380
  0.400
  0.430
  0.450
  0.480
  0.500
  0.530
  0.550
  0.570
  0.590
  0.620
  0.640
  0.660
  0.670
  0.690
  0.710
  0.730
  0.740
  0.760
  0.780
  0.790
  0.800
  0.820
Adjusted equity ratio
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479
  0.479

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -73
  -74
  -76
  -78
  -80
  -83
  -86
  -88
  -92
  -95
  -87
  -91
  -95
  -99
  -104
  -108
  -114
  -119
  -125
  -131
  -137
  -144
  -151
  -159
  -166
  -175
  -183
  -193
  -202
  -213
Depreciation, amort., depletion, $m
  17
  17
  17
  17
  18
  18
  18
  18
  18
  19
  7
  8
  8
  8
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  14
  14
  15
  16
  16
  17
Funds from operations, $m
  -56
  -57
  -59
  -61
  -63
  -65
  -68
  -70
  -73
  -76
  -79
  -83
  -87
  -91
  -95
  -99
  -104
  -109
  -114
  -120
  -126
  -132
  -139
  -146
  -153
  -160
  -169
  -177
  -186
  -195
Change in working capital, $m
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
Cash from operations, $m
  -56
  -58
  -59
  -61
  -63
  -66
  -68
  -71
  -74
  -77
  -80
  -84
  -87
  -91
  -96
  -100
  -105
  -110
  -115
  -121
  -127
  -133
  -140
  -147
  -154
  -162
  -170
  -178
  -187
  -197
Maintenance CAPEX, $m
  -5
  -5
  -5
  -6
  -6
  -6
  -6
  -6
  -7
  -7
  -7
  -7
  -8
  -8
  -8
  -9
  -9
  -9
  -10
  -10
  -11
  -11
  -12
  -12
  -13
  -14
  -14
  -15
  -16
  -16
New CAPEX, $m
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -8
  -8
  -9
  -9
  -10
  -10
  -11
  -11
  -12
Cash from investing activities, $m
  -7
  -7
  -7
  -8
  -9
  -9
  -9
  -9
  -11
  -11
  -11
  -11
  -13
  -13
  -13
  -15
  -15
  -15
  -17
  -17
  -18
  -19
  -20
  -21
  -22
  -24
  -24
  -26
  -27
  -28
Free cash flow, $m
  -63
  -65
  -67
  -69
  -72
  -74
  -77
  -80
  -84
  -87
  -91
  -95
  -100
  -104
  -109
  -115
  -120
  -126
  -132
  -138
  -145
  -152
  -160
  -168
  -176
  -185
  -194
  -204
  -215
  -225
Issuance/(repayment) of debt, $m
  3
  4
  4
  5
  6
  6
  7
  7
  8
  8
  9
  9
  10
  11
  11
  12
  13
  13
  14
  15
  16
  17
  18
  18
  19
  20
  22
  23
  24
  25
Issuance/(repurchase) of shares, $m
  76
  78
  80
  83
  86
  88
  92
  95
  99
  102
  95
  99
  104
  109
  114
  119
  125
  131
  138
  145
  152
  159
  167
  176
  184
  194
  203
  214
  224
  236
Cash from financing (excl. dividends), $m  
  79
  82
  84
  88
  92
  94
  99
  102
  107
  110
  104
  108
  114
  120
  125
  131
  138
  144
  152
  160
  168
  176
  185
  194
  203
  214
  225
  237
  248
  261
Total cash flow (excl. dividends), $m
  16
  17
  18
  19
  19
  20
  21
  22
  22
  23
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  25
  26
  27
  29
  30
  32
  34
  35
Retained Cash Flow (-), $m
  -76
  -78
  -80
  -83
  -86
  -88
  -92
  -95
  -99
  -102
  -95
  -99
  -104
  -109
  -114
  -119
  -125
  -131
  -138
  -145
  -152
  -159
  -167
  -176
  -184
  -194
  -203
  -214
  -224
  -236
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
  -60
  -61
  -62
  -64
  -66
  -68
  -71
  -73
  -76
  -79
  -83
  -86
  -90
  -94
  -98
  -103
  -107
  -112
  -118
  -123
  -129
  -136
  -142
  -150
  -157
  -165
  -173
  -182
  -191
  -200
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
  -57
  -56
  -54
  -53
  -51
  -50
  -48
  -46
  -44
  -42
  -39
  -37
  -34
  -31
  -29
  -26
  -23
  -21
  -18
  -16
  -13
  -11
  -9
  -8
  -6
  -5
  -4
  -3
  -2
  -2
Current shareholders' claim on cash, %
  83.3
  69.3
  57.6
  47.8
  39.6
  32.9
  27.2
  22.5
  18.7
  15.4
  13.0
  11.0
  9.2
  7.8
  6.5
  5.5
  4.6
  3.9
  3.2
  2.7
  2.3
  1.9
  1.6
  1.3
  1.1
  0.9
  0.8
  0.6
  0.5
  0.4

Calix, Inc. provides broadband communications access systems and software for fiber- and copper-based network architectures that enable communications service providers (CSPs), to transform their networks and connect to their residential and business subscribers. The Company enables CSPs to provide various services, from basic voice and data to advanced broadband services, over legacy and next-generation access networks. It develops and sells carrier-class hardware and cloud products. Its portfolio consists of three core systems and/or nodes: E-Series access systems and nodes (E-Series systems and nodes), B6 access nodes (B-Series nodes), and the C7 multiservice, multiprotocol access system (C-Series system). These systems and nodes are complemented by the P-Series optical network terminals and residential gateways, the GigaFamily of GigaCenters, GigaHubs, and GigaPoints, the Calix Management System, OpenLink Cable software and Compass Cloud family of software-as-a-service products.

FINANCIAL RATIOS  of  Calix, Inc (CALX)

Valuation Ratios
P/E Ratio -12.8
Price to Sales 0.8
Price to Book 1.6
Price to Tangible Book
Price to Cash Flow 14.4
Price to Free Cash Flow 24.7
Growth Rates
Sales Growth Rate 12.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 42.9%
Cap. Spend. - 3 Yr. Gr. Rate 7.4%
Financial Strength
Quick Ratio NaN
Current Ratio 0.3
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -8%
Ret/ On Assets - 3 Yr. Avg. -7%
Return On Total Capital -12%
Ret/ On T. Cap. - 3 Yr. Avg. -10%
Return On Equity -12%
Return On Equity - 3 Yr. Avg. -10%
Asset Turnover 1.4
Profitability Ratios
Gross Margin 43.8%
Gross Margin - 3 Yr. Avg. 45%
EBITDA Margin -2.8%
EBITDA Margin - 3 Yr. Avg. -0%
Operating Margin -6.1%
Oper. Margin - 3 Yr. Avg. -6%
Pre-Tax Margin -5.9%
Pre-Tax Margin - 3 Yr. Avg. -5.8%
Net Profit Margin -5.9%
Net Profit Margin - 3 Yr. Avg. -5.8%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. -1.7%
Payout Ratio 0%

CALX stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CALX stock intrinsic value calculation we used $441 million for the last fiscal year's total revenue generated by Calix, Inc. The default revenue input number comes from 0001 income statement of Calix, 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 CALX 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 4.3%, whose default value for CALX is calculated based on our internal credit rating of Calix, 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 Calix, 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 CALX stock the variable cost ratio is equal to 115.9%.

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 CALX 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 Calix, Inc.

Corporate tax rate of 27% is the nominal tax rate for Calix, 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 CALX 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 CALX are equal to 17.8%.

Life of production assets of 14.9 years is the average useful life of capital assets used in Calix, 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 CALX is equal to 2.5%. 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 - $151.934 million for Calix, 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 54.041 million for Calix, 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 Calix, Inc at the current share price and the inputted number of shares is $0.4 billion.

RELATED COMPANIES Price Int.Val. Rating
ADTN ADTRAN, Inc. 15.72 19.03  buy
DZSI DASAN Zhone So 12.48 14.89  buy
CIEN Ciena Corporat 44.08 21.09  sell
NOK Nokia Corporat 5.10 17.60  str.buy
ATEN A10 Networks, 7.01 0.31  str.sell
FFIV F5 Networks, I 145.56 135.40  hold
ARRS ARRIS Internat 31.61 46.79  buy
CTL CenturyLink, I 12.20 38.99  str.buy

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

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