Intrinsic value of Cathay General Bancorp - CATY

Previous Close

$42.17

  Intrinsic Value

$12.80

stock screener

  Rating & Target

str. sell

-70%

Previous close

$42.17

 
Intrinsic value

$12.80

 
Up/down potential

-70%

 
Rating

str. sell

Our model is not good at valuating stocks of financial companies, such as CATY.

We calculate the intrinsic value of CATY 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 2017), $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 3.4

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   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
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  14.50
  13.55
  12.70
  11.93
  11.23
  10.61
  10.05
  9.54
  9.09
  8.68
  8.31
  7.98
  7.68
  7.41
  7.17
  6.96
  6.76
  6.58
  6.43
  6.28
  6.15
  6.04
  5.94
  5.84
  5.76
  5.68
  5.61
  5.55
  5.50
  5.45
Revenue, $m
  613
  696
  784
  877
  976
  1,079
  1,188
  1,301
  1,420
  1,543
  1,671
  1,804
  1,943
  2,087
  2,237
  2,392
  2,554
  2,722
  2,897
  3,079
  3,269
  3,466
  3,672
  3,887
  4,110
  4,344
  4,588
  4,842
  5,109
  5,387
Variable operating expenses, $m
  104
  118
  133
  149
  166
  184
  202
  221
  241
  262
  284
  307
  330
  355
  380
  407
  434
  463
  493
  523
  556
  589
  624
  661
  699
  738
  780
  823
  868
  916
Fixed operating expenses, $m
  152
  156
  159
  163
  166
  170
  174
  177
  181
  185
  189
  193
  198
  202
  207
  211
  216
  220
  225
  230
  235
  240
  246
  251
  257
  262
  268
  274
  280
  286
Total operating expenses, $m
  256
  274
  292
  312
  332
  354
  376
  398
  422
  447
  473
  500
  528
  557
  587
  618
  650
  683
  718
  753
  791
  829
  870
  912
  956
  1,000
  1,048
  1,097
  1,148
  1,202
Operating income, $m
  356
  422
  492
  566
  644
  726
  812
  903
  997
  1,095
  1,198
  1,304
  1,415
  1,530
  1,650
  1,775
  1,904
  2,039
  2,179
  2,326
  2,478
  2,637
  2,802
  2,975
  3,155
  3,343
  3,540
  3,745
  3,960
  4,185
EBITDA, $m
  2,084
  2,384
  2,703
  3,041
  3,397
  3,772
  4,164
  4,574
  5,002
  5,448
  5,912
  6,395
  6,897
  7,419
  7,961
  8,525
  9,111
  9,720
  10,354
  11,014
  11,701
  12,416
  13,162
  13,940
  14,752
  15,599
  16,484
  17,408
  18,374
  19,384
Interest expense (income), $m
  82
  777
  800
  896
  998
  1,107
  1,221
  1,340
  1,466
  1,597
  1,734
  1,877
  2,025
  2,179
  2,340
  2,506
  2,680
  2,860
  3,047
  3,242
  3,444
  3,655
  3,874
  4,102
  4,340
  4,589
  4,848
  5,118
  5,400
  5,695
  6,003
Earnings before tax, $m
  -421
  -378
  -405
  -433
  -463
  -494
  -528
  -563
  -600
  -639
  -679
  -721
  -764
  -809
  -856
  -905
  -955
  -1,008
  -1,062
  -1,118
  -1,177
  -1,237
  -1,300
  -1,366
  -1,434
  -1,505
  -1,578
  -1,655
  -1,735
  -1,818
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
  -421
  -378
  -405
  -433
  -463
  -494
  -528
  -563
  -600
  -639
  -679
  -721
  -764
  -809
  -856
  -905
  -955
  -1,008
  -1,062
  -1,118
  -1,177
  -1,237
  -1,300
  -1,366
  -1,434
  -1,505
  -1,578
  -1,655
  -1,735
  -1,818

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
  14,585
  16,561
  18,664
  20,890
  23,236
  25,701
  28,284
  30,983
  33,800
  36,734
  39,787
  42,963
  46,263
  49,694
  53,259
  56,963
  60,814
  64,818
  68,983
  73,318
  77,831
  82,531
  87,430
  92,537
  97,866
  103,426
  109,232
  115,297
  121,636
  128,262
Adjusted assets (=assets-cash), $m
  14,585
  16,561
  18,664
  20,890
  23,236
  25,701
  28,284
  30,983
  33,800
  36,734
  39,787
  42,963
  46,263
  49,694
  53,259
  56,963
  60,814
  64,818
  68,983
  73,318
  77,831
  82,531
  87,430
  92,537
  97,866
  103,426
  109,232
  115,297
  121,636
  128,262
Revenue / Adjusted assets
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
  0.042
Average production assets, $m
  17,283
  19,625
  22,116
  24,754
  27,535
  30,456
  33,516
  36,715
  40,052
  43,529
  47,147
  50,910
  54,822
  58,887
  63,111
  67,501
  72,064
  76,809
  81,745
  86,881
  92,228
  97,798
  103,603
  109,656
  115,969
  122,559
  129,439
  136,626
  144,137
  151,988
Working capital, $m
  -15,227
  -17,291
  -19,486
  -21,810
  -24,259
  -26,833
  -29,530
  -32,348
  -35,288
  -38,351
  -41,539
  -44,855
  -48,301
  -51,882
  -55,604
  -59,472
  -63,492
  -67,673
  -72,021
  -76,546
  -81,258
  -86,165
  -91,280
  -96,612
  -102,175
  -107,981
  -114,043
  -120,375
  -126,992
  -133,910
Total debt, $m
  14,818
  16,597
  18,489
  20,492
  22,604
  24,823
  27,147
  29,577
  32,111
  34,752
  37,500
  40,358
  43,329
  46,416
  49,624
  52,958
  56,424
  60,028
  63,777
  67,678
  71,739
  75,969
  80,378
  84,975
  89,770
  94,775
  100,001
  105,459
  111,163
  117,127
Total liabilities, $m
  13,127
  14,905
  16,797
  18,801
  20,913
  23,131
  25,456
  27,885
  30,420
  33,060
  35,808
  38,666
  41,637
  44,724
  47,933
  51,267
  54,733
  58,336
  62,085
  65,986
  70,048
  74,278
  78,687
  83,284
  88,079
  93,084
  98,309
  103,768
  109,472
  115,435
Total equity, $m
  1,459
  1,656
  1,866
  2,089
  2,324
  2,570
  2,828
  3,098
  3,380
  3,673
  3,979
  4,296
  4,626
  4,969
  5,326
  5,696
  6,081
  6,482
  6,898
  7,332
  7,783
  8,253
  8,743
  9,254
  9,787
  10,343
  10,923
  11,530
  12,164
  12,826
Total liabilities and equity, $m
  14,586
  16,561
  18,663
  20,890
  23,237
  25,701
  28,284
  30,983
  33,800
  36,733
  39,787
  42,962
  46,263
  49,693
  53,259
  56,963
  60,814
  64,818
  68,983
  73,318
  77,831
  82,531
  87,430
  92,538
  97,866
  103,427
  109,232
  115,298
  121,636
  128,261
Debt-to-equity ratio
  10.160
  10.020
  9.910
  9.810
  9.730
  9.660
  9.600
  9.550
  9.500
  9.460
  9.430
  9.390
  9.370
  9.340
  9.320
  9.300
  9.280
  9.260
  9.250
  9.230
  9.220
  9.200
  9.190
  9.180
  9.170
  9.160
  9.150
  9.150
  9.140
  9.130
Adjusted equity ratio
  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
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -421
  -378
  -405
  -433
  -463
  -494
  -528
  -563
  -600
  -639
  -679
  -721
  -764
  -809
  -856
  -905
  -955
  -1,008
  -1,062
  -1,118
  -1,177
  -1,237
  -1,300
  -1,366
  -1,434
  -1,505
  -1,578
  -1,655
  -1,735
  -1,818
Depreciation, amort., depletion, $m
  1,728
  1,963
  2,212
  2,475
  2,753
  3,046
  3,352
  3,672
  4,005
  4,353
  4,715
  5,091
  5,482
  5,889
  6,311
  6,750
  7,206
  7,681
  8,174
  8,688
  9,223
  9,780
  10,360
  10,966
  11,597
  12,256
  12,944
  13,663
  14,414
  15,199
Funds from operations, $m
  1,308
  1,584
  1,807
  2,043
  2,291
  2,551
  2,824
  3,108
  3,405
  3,714
  4,036
  4,370
  4,718
  5,079
  5,455
  5,845
  6,251
  6,673
  7,112
  7,570
  8,046
  8,542
  9,060
  9,600
  10,163
  10,751
  11,366
  12,008
  12,679
  13,381
Change in working capital, $m
  -1,928
  -2,063
  -2,195
  -2,324
  -2,450
  -2,574
  -2,696
  -2,818
  -2,940
  -3,063
  -3,188
  -3,315
  -3,446
  -3,581
  -3,722
  -3,868
  -4,020
  -4,181
  -4,349
  -4,525
  -4,711
  -4,908
  -5,114
  -5,333
  -5,563
  -5,806
  -6,062
  -6,332
  -6,617
  -6,918
Cash from operations, $m
  3,236
  3,647
  4,002
  4,366
  4,741
  5,125
  5,520
  5,927
  6,345
  6,777
  7,224
  7,686
  8,164
  8,661
  9,176
  9,713
  10,271
  10,854
  11,461
  12,095
  12,758
  13,450
  14,174
  14,932
  15,726
  16,557
  17,428
  18,340
  19,296
  20,299
Maintenance CAPEX, $m
  -1,508
  -1,728
  -1,963
  -2,212
  -2,475
  -2,753
  -3,046
  -3,352
  -3,672
  -4,005
  -4,353
  -4,715
  -5,091
  -5,482
  -5,889
  -6,311
  -6,750
  -7,206
  -7,681
  -8,174
  -8,688
  -9,223
  -9,780
  -10,360
  -10,966
  -11,597
  -12,256
  -12,944
  -13,663
  -14,414
New CAPEX, $m
  -2,203
  -2,342
  -2,491
  -2,637
  -2,781
  -2,921
  -3,060
  -3,199
  -3,337
  -3,477
  -3,618
  -3,763
  -3,911
  -4,065
  -4,224
  -4,390
  -4,563
  -4,745
  -4,936
  -5,136
  -5,347
  -5,570
  -5,805
  -6,052
  -6,314
  -6,589
  -6,880
  -7,187
  -7,511
  -7,852
Cash from investing activities, $m
  -3,711
  -4,070
  -4,454
  -4,849
  -5,256
  -5,674
  -6,106
  -6,551
  -7,009
  -7,482
  -7,971
  -8,478
  -9,002
  -9,547
  -10,113
  -10,701
  -11,313
  -11,951
  -12,617
  -13,310
  -14,035
  -14,793
  -15,585
  -16,412
  -17,280
  -18,186
  -19,136
  -20,131
  -21,174
  -22,266
Free cash flow, $m
  -475
  -423
  -452
  -483
  -515
  -550
  -586
  -624
  -663
  -705
  -747
  -792
  -838
  -887
  -936
  -988
  -1,042
  -1,098
  -1,156
  -1,216
  -1,278
  -1,343
  -1,410
  -1,480
  -1,553
  -1,629
  -1,709
  -1,791
  -1,877
  -1,967
Issuance/(repayment) of debt, $m
  434
  1,779
  1,892
  2,003
  2,112
  2,219
  2,324
  2,429
  2,535
  2,641
  2,748
  2,858
  2,971
  3,087
  3,208
  3,334
  3,466
  3,604
  3,749
  3,901
  4,061
  4,231
  4,409
  4,597
  4,795
  5,005
  5,226
  5,459
  5,704
  5,963
Issuance/(repurchase) of shares, $m
  1,882
  576
  615
  655
  697
  741
  786
  833
  882
  932
  984
  1,038
  1,094
  1,153
  1,213
  1,275
  1,341
  1,408
  1,479
  1,552
  1,628
  1,707
  1,790
  1,877
  1,967
  2,061
  2,159
  2,261
  2,368
  2,480
Cash from financing (excl. dividends), $m  
  2,316
  2,355
  2,507
  2,658
  2,809
  2,960
  3,110
  3,262
  3,417
  3,573
  3,732
  3,896
  4,065
  4,240
  4,421
  4,609
  4,807
  5,012
  5,228
  5,453
  5,689
  5,938
  6,199
  6,474
  6,762
  7,066
  7,385
  7,720
  8,072
  8,443
Total cash flow (excl. dividends), $m
  1,841
  1,932
  2,055
  2,176
  2,294
  2,410
  2,525
  2,639
  2,753
  2,868
  2,985
  3,104
  3,227
  3,353
  3,485
  3,621
  3,764
  3,914
  4,072
  4,237
  4,411
  4,595
  4,789
  4,993
  5,208
  5,436
  5,676
  5,929
  6,196
  6,477
Retained Cash Flow (-), $m
  -1,882
  -576
  -615
  -655
  -697
  -741
  -786
  -833
  -882
  -932
  -984
  -1,038
  -1,094
  -1,153
  -1,213
  -1,275
  -1,341
  -1,408
  -1,479
  -1,552
  -1,628
  -1,707
  -1,790
  -1,877
  -1,967
  -2,061
  -2,159
  -2,261
  -2,368
  -2,480
Prev. year cash balance distribution, $m
  3
  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
  6
  7
  8
  9
  10
  11
  12
  13
  14
  16
  17
  18
  20
  21
  23
  25
  26
  28
  30
  32
  34
  36
  38
  40
  43
  45
  48
  50
  53
  56
Cash available for distribution, $m
  -38
  1,356
  1,440
  1,520
  1,596
  1,669
  1,738
  1,806
  1,871
  1,936
  2,001
  2,066
  2,132
  2,201
  2,272
  2,346
  2,424
  2,506
  2,593
  2,685
  2,783
  2,888
  2,998
  3,116
  3,242
  3,375
  3,517
  3,668
  3,827
  3,997
Discount rate, %
  14.60
  15.33
  16.10
  16.90
  17.75
  18.63
  19.57
  20.54
  21.57
  22.65
  23.78
  24.97
  26.22
  27.53
  28.91
  30.35
  31.87
  33.46
  35.14
  36.89
  38.74
  40.68
  42.71
  44.84
  47.09
  49.44
  51.91
  54.51
  57.23
  60.10
PV of cash for distribution, $m
  -33
  1,019
  920
  814
  705
  599
  498
  405
  323
  251
  191
  142
  103
  73
  50
  34
  22
  14
  8
  5
  3
  2
  1
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  35.8
  26.1
  19.3
  14.5
  11.0
  8.4
  6.5
  5.1
  4.0
  3.1
  2.5
  2.0
  1.6
  1.3
  1.0
  0.8
  0.7
  0.5
  0.4
  0.4
  0.3
  0.2
  0.2
  0.2
  0.1
  0.1
  0.1
  0.1
  0.1

Cathay General Bancorp is a bank holding company. The Company holds Cathay Bank, a California state-chartered commercial bank (the Bank); seven limited partnerships investing in affordable housing investments; GBC Venture Capital, Inc., and Asia Realty Corp. The Company also owns the common stock of five statutory business trusts created for issuing capital securities. The Bank primarily services individuals, professionals and small to medium-sized businesses in the local markets and provides commercial mortgage loans, commercial loans, small business administration (SBA) loans, residential mortgage loans, real estate construction loans, home equity lines of credit and installment loans to individuals for automobile, household and other consumer expenditures. The Bank offers passbook accounts, checking accounts, money market deposit accounts, certificates of deposit, individual retirement accounts, college certificates of deposit and public funds deposits.

FINANCIAL RATIOS  of  Cathay General Bancorp (CATY)

Valuation Ratios
P/E Ratio 19.2
Price to Sales 0
Price to Book 1.8
Price to Tangible Book
Price to Cash Flow 14.3
Price to Free Cash Flow 14.6
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 0%
Cap. Spend. - 3 Yr. Gr. Rate -7.8%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 26.6%
Total Debt to Equity 26.6%
Interest Coverage 4
Management Effectiveness
Return On Assets 1.7%
Ret/ On Assets - 3 Yr. Avg. 1.7%
Return On Total Capital 7.6%
Ret/ On T. Cap. - 3 Yr. Avg. 6.9%
Return On Equity 9.8%
Return On Equity - 3 Yr. Avg. 9.5%
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 27.7%
Eff/ Tax Rate - 3 Yr. Avg. 30.7%
Payout Ratio 33.7%

CATY stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CATY stock intrinsic value calculation we used $535 million for the last fiscal year's total revenue generated by Cathay General Bancorp. The default revenue input number comes from 2017 income statement of Cathay General Bancorp. 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 CATY stock valuation model: a) initial revenue growth rate of 14.5% 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 14.6%, whose default value for CATY is calculated based on our internal credit rating of Cathay General Bancorp, 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 Cathay General Bancorp.
    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 CATY stock the variable cost ratio is equal to 17%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $149 million in the base year in the intrinsic value calculation for CATY 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 Cathay General Bancorp.

Corporate tax rate of 27% is the nominal tax rate for Cathay General Bancorp. 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 CATY stock is equal to 1.1%.

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 CATY are equal to 2821.4%.

Life of production assets of 10 years is the average useful life of capital assets used in Cathay General Bancorp 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 CATY is equal to -2485.8%. 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 - $0 million for Cathay General Bancorp - 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 80 million for Cathay General Bancorp 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 Cathay General Bancorp at the current share price and the inputted number of shares is $3.4 billion.

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COMPANY NEWS

▶ Cathay General Bancorp Declares $0.24 Per Share Dividend   [Aug-16-18 08:10PM  PR Newswire]
▶ Cathay: 2Q Earnings Snapshot   [Jul-18-18 04:54PM  Associated Press]
▶ Cathay Bank Teams With UCLA Anderson Forecast   [Jun-13-18 10:31PM  PR Newswire]
▶ Cathay General Bancorp Declares $0.24 Per Share Dividend   [May-17-18 07:22PM  PR Newswire]
▶ Cathay General Bancorp And Other High Value-Adding Stocks   [Apr-19-18 07:02AM  Simply Wall St.]
▶ Cathay: 1Q Earnings Snapshot   [Apr-18-18 05:21PM  Associated Press]
▶ Cathay General Bancorp Declares $0.24 Per Share Dividend   [Feb-15-18 07:35PM  PR Newswire]
▶ Cathay posts 4Q profit   [Jan-30-18 04:55PM  Associated Press]
▶ Cathay General Bancorp Getting Closer To Key Technical Measure   [Jan-12-18 03:00AM  Investor's Business Daily]
▶ Top-Rated Stocks: Cathay General Bancorp Sees Composite Rating Climb To 96   [Dec-18-17 03:00AM  Investor's Business Daily]
▶ Cathay General Bancorp Hits 80-Plus Relative Strength Rating Benchmark   [Nov-29-17 03:00AM  Investor's Business Daily]
▶ Cathay General Bancorp Declares $0.24 Per Share Dividend   [Nov-16-17 08:30PM  PR Newswire]
▶ Cathay beats Street 3Q forecasts   [Oct-25-17 07:49PM  Associated Press]
▶ Opening Bell, October 18, 2017   [09:29AM  CNBC Videos]
▶ Cathay General Bancorp Earns Relative Strength Rating Upgrade   [Oct-03-17 03:00AM  Investor's Business Daily]
▶ Is It The Right Time To Buy Cathay General Bancorp (CATY)?   [Sep-08-17 01:50PM  Simply Wall St.]
▶ Cathay General Bancorp Declares $0.21 Per Share Dividend   [Aug-17-17 08:36PM  PR Newswire]
▶ New Strong Buy Stocks for August 15th   [Aug-15-17 10:43AM  Zacks]
▶ Cathay posts 2Q profit   [Jul-19-17 09:57PM  Associated Press]
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