Intrinsic value of CombiMatrix - CBMX

Previous Close

$7.90

  Intrinsic Value

$94.95

stock screener

  Rating & Target

str. buy

+999%

  Value-price divergence*

+5000%

Previous close

$7.90

 
Intrinsic value

$94.95

 
Up/down potential

+999%

 
Rating

str. buy

 
Value-price divergence*

+5000%

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

We calculate the intrinsic value of CBMX 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 2016), $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 0.0

 

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, %
  30.00
  33.30
  30.47
  27.92
  25.63
  23.57
  21.71
  20.04
  18.54
  17.18
  15.96
  14.87
  13.88
  12.99
  12.19
  11.47
  10.83
  10.24
  9.72
  9.25
  8.82
  8.44
  8.10
  7.79
  7.51
  7.26
  7.03
  6.83
  6.65
  6.48
  6.33
Revenue, $m
  13
  17
  23
  29
  36
  45
  55
  66
  78
  91
  106
  121
  138
  156
  175
  195
  216
  239
  262
  286
  311
  338
  365
  393
  423
  454
  485
  519
  553
  589
  626
Variable operating expenses, $m
 
  5
  7
  9
  11
  14
  17
  20
  24
  28
  33
  37
  43
  48
  54
  60
  67
  74
  81
  88
  96
  104
  112
  121
  130
  140
  150
  160
  170
  181
  193
Fixed operating expenses, $m
 
  14
  15
  15
  15
  16
  16
  17
  17
  17
  18
  18
  19
  19
  20
  20
  21
  21
  22
  22
  23
  24
  24
  25
  25
  26
  27
  27
  28
  29
  29
Total operating expenses, $m
  17
  19
  22
  24
  26
  30
  33
  37
  41
  45
  51
  55
  62
  67
  74
  80
  88
  95
  103
  110
  119
  128
  136
  146
  155
  166
  177
  187
  198
  210
  222
Operating income, $m
  -4
  -2
  1
  5
  10
  15
  22
  29
  37
  46
  55
  66
  77
  89
  101
  115
  129
  144
  159
  176
  192
  210
  228
  247
  267
  288
  309
  332
  355
  379
  404
EBITDA, $m
  -4
  -2
  1
  5
  10
  15
  22
  29
  37
  46
  55
  66
  77
  89
  101
  115
  129
  144
  159
  176
  192
  210
  228
  247
  267
  288
  309
  332
  355
  379
  404
Interest expense (income), $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
Earnings before tax, $m
  -4
  -2
  1
  5
  10
  15
  21
  29
  36
  45
  55
  65
  76
  88
  101
  114
  128
  143
  158
  174
  191
  208
  227
  246
  265
  286
  307
  329
  352
  376
  401
Tax expense, $m
  0
  0
  0
  1
  3
  4
  6
  8
  10
  12
  15
  18
  21
  24
  27
  31
  35
  39
  43
  47
  52
  56
  61
  66
  72
  77
  83
  89
  95
  102
  108
Net income, $m
  -4
  -2
  1
  4
  7
  11
  16
  21
  27
  33
  40
  48
  56
  64
  74
  83
  93
  104
  115
  127
  139
  152
  165
  179
  194
  209
  224
  240
  257
  274
  293

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  4
  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
  8
  5
  7
  9
  11
  14
  17
  20
  24
  28
  33
  37
  43
  48
  54
  60
  67
  73
  81
  88
  96
  104
  112
  121
  130
  140
  149
  160
  170
  181
  193
Adjusted assets (=assets-cash), $m
  4
  5
  7
  9
  11
  14
  17
  20
  24
  28
  33
  37
  43
  48
  54
  60
  67
  73
  81
  88
  96
  104
  112
  121
  130
  140
  149
  160
  170
  181
  193
Revenue / Adjusted assets
  3.250
  3.400
  3.286
  3.222
  3.273
  3.214
  3.235
  3.300
  3.250
  3.250
  3.212
  3.270
  3.209
  3.250
  3.241
  3.250
  3.224
  3.274
  3.235
  3.250
  3.240
  3.250
  3.259
  3.248
  3.254
  3.243
  3.255
  3.244
  3.253
  3.254
  3.244
Average production assets, $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
Working capital, $m
  6
  3
  3
  4
  6
  7
  8
  10
  12
  14
  16
  19
  21
  24
  27
  30
  33
  37
  40
  44
  48
  52
  56
  61
  65
  70
  75
  80
  85
  91
  96
Total debt, $m
  0
  1
  1
  2
  4
  5
  6
  8
  10
  12
  14
  17
  19
  22
  25
  28
  31
  35
  38
  42
  46
  50
  54
  59
  63
  68
  73
  78
  83
  89
  94
Total liabilities, $m
  2
  3
  3
  4
  6
  7
  8
  10
  12
  14
  16
  19
  21
  24
  27
  30
  33
  37
  40
  44
  48
  52
  56
  61
  65
  70
  75
  80
  85
  91
  96
Total equity, $m
  6
  3
  3
  4
  6
  7
  8
  10
  12
  14
  16
  19
  21
  24
  27
  30
  33
  37
  40
  44
  48
  52
  56
  61
  65
  70
  75
  80
  85
  91
  96
Total liabilities and equity, $m
  8
  6
  6
  8
  12
  14
  16
  20
  24
  28
  32
  38
  42
  48
  54
  60
  66
  74
  80
  88
  96
  104
  112
  122
  130
  140
  150
  160
  170
  182
  192
Debt-to-equity ratio
  0.000
  0.250
  0.430
  0.550
  0.640
  0.710
  0.760
  0.800
  0.830
  0.860
  0.880
  0.890
  0.910
  0.920
  0.930
  0.930
  0.940
  0.950
  0.950
  0.950
  0.960
  0.960
  0.960
  0.970
  0.970
  0.970
  0.970
  0.970
  0.980
  0.980
  0.980
Adjusted equity ratio
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -4
  -2
  1
  4
  7
  11
  16
  21
  27
  33
  40
  48
  56
  64
  74
  83
  93
  104
  115
  127
  139
  152
  165
  179
  194
  209
  224
  240
  257
  274
  293
Depreciation, amort., depletion, $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
Funds from operations, $m
  -5
  -2
  1
  4
  7
  11
  16
  21
  27
  33
  40
  48
  56
  64
  74
  83
  93
  104
  115
  127
  139
  152
  165
  179
  194
  209
  224
  240
  257
  274
  293
Change in working capital, $m
  -1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
Cash from operations, $m
  -4
  -3
  0
  3
  6
  10
  14
  19
  25
  31
  38
  45
  53
  62
  71
  80
  90
  101
  112
  123
  136
  148
  161
  175
  189
  204
  219
  235
  252
  269
  287
Maintenance CAPEX, $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
New CAPEX, $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
Cash from investing activities, $m
  2
  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
Free cash flow, $m
  -2
  -3
  0
  3
  6
  10
  14
  19
  25
  31
  38
  45
  53
  62
  71
  80
  90
  101
  112
  123
  136
  148
  161
  175
  189
  204
  219
  235
  252
  269
  287
Issuance/(repayment) of debt, $m
  0
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
Issuance/(repurchase) of shares, $m
  5
  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 from financing (excl. dividends), $m  
  4
  4
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
Total cash flow (excl. dividends), $m
  2
  1
  1
  4
  7
  11
  16
  21
  27
  33
  40
  48
  56
  64
  74
  83
  93
  104
  115
  127
  139
  152
  165
  179
  194
  209
  224
  240
  257
  274
  293
Retained Cash Flow (-), $m
  0
  -3
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -5
  -6
  -6
Prev. year cash balance distribution, $m
 
  4
  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
 
  2
  0
  3
  6
  10
  14
  19
  25
  31
  38
  45
  53
  62
  71
  80
  90
  101
  112
  123
  136
  148
  161
  175
  189
  204
  219
  235
  252
  269
  287
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
 
  2
  0
  2
  5
  8
  10
  13
  15
  18
  20
  21
  23
  23
  24
  24
  23
  22
  21
  19
  17
  15
  13
  11
  10
  8
  6
  5
  4
  3
  2
Current shareholders' claim on cash, %
  100
  71.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8
  70.8

CombiMatrix Corporation is a provider of molecular diagnostic solutions. The Company specializes in pre-implantation genetic screening, miscarriage analysis, prenatal diagnosis and pediatric developmental disorders, offering deoxyribonucleic acid-based testing for the detection of genetic abnormalities, which cannot be identified through traditional methodologies. It performs genetic testing utilizing a range of cytogenomic techniques, including chromosomal microarray analysis, fluorescence in situ hybridization and karyotyping. Its prenatal and postnatal microarray focuses on diagnosing genomic syndromes associated with intellectual disability, developmental delays, congenital anomalies, dysmorphic features and autism spectrum disorders. It develops and markets its molecular testing services in approximately four markets, such as in vitro fertilization (IVF), miscarriage analysis (products of conception analysis), prenatal genetics and postnatal developmental disorders.

FINANCIAL RATIOS  of  CombiMatrix (CBMX)

Valuation Ratios
P/E Ratio -5.3
Price to Sales 1.6
Price to Book 3.5
Price to Tangible Book
Price to Cash Flow -5.3
Price to Free Cash Flow -5.3
Growth Rates
Sales Growth Rate 30%
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 0
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -50%
Ret/ On Assets - 3 Yr. Avg. -67.2%
Return On Total Capital -66.7%
Ret/ On T. Cap. - 3 Yr. Avg. -85.4%
Return On Equity -66.7%
Return On Equity - 3 Yr. Avg. -85.4%
Asset Turnover 1.6
Profitability Ratios
Gross Margin 53.8%
Gross Margin - 3 Yr. Avg. 51.3%
EBITDA Margin -30.8%
EBITDA Margin - 3 Yr. Avg. -71.1%
Operating Margin -30.8%
Oper. Margin - 3 Yr. Avg. -71.1%
Pre-Tax Margin -30.8%
Pre-Tax Margin - 3 Yr. Avg. -71.1%
Net Profit Margin -30.8%
Net Profit Margin - 3 Yr. Avg. -71.1%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

CBMX stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CBMX stock intrinsic value calculation we used $13 million for the last fiscal year's total revenue generated by CombiMatrix. The default revenue input number comes from 2016 income statement of CombiMatrix. 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 CBMX stock valuation model: a) initial revenue growth rate of 33.3% 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 4.3%, whose default value for CBMX is calculated based on our internal credit rating of CombiMatrix, 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 CombiMatrix.
    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 CBMX stock the variable cost ratio is equal to 30.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $14 million in the base year in the intrinsic value calculation for CBMX 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 3.5% for CombiMatrix.

Corporate tax rate of 27% is the nominal tax rate for CombiMatrix. 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 CBMX 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 CBMX are equal to 0%.

Life of production assets of 10 years is the average useful life of capital assets used in CombiMatrix 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 CBMX is equal to 15.4%. 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 - $6 million for CombiMatrix - 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 2.918 million for CombiMatrix 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 CombiMatrix at the current share price and the inputted number of shares is $0.0 billion.

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COMPANY NEWS

▶ CombiMatrix shares jump on buyout news   [Aug-01-17 05:39PM  Investing.com]
▶ CombiMatrix to Present at Upcoming Investor Conferences   [May-22-17 06:00AM  GlobeNewswire]
▶ CombiMatrix and Vertex Pharmaceuticals Make Gains   [Mar-30-17 09:30AM  Accesswire]
▶ CBMX: Q4 Records On Almost Every Measure   [Feb-28-17 11:00AM  Zacks Small Cap Research]
▶ CBMX:Expect Record Revenue, Profit in 2017 On Strong Fundamentals   [Feb-10-17 09:00AM  Zacks Small Cap Research]
▶ CombiMatrix to Present at September Investment Conferences   [Sep-08-16 06:00AM  GlobeNewswire]
▶ CombiMatrix to Present at Upcoming Investment Conferences   [May-25-16 06:00AM  GlobeNewswire]
▶ CombiMatrix Provides Strategic Update   [06:00AM  GlobeNewswire]
▶ CBMX: Several Recent Events Could Catalyze Additional Growth   [Apr-20-16 03:30PM  Zacks Small Cap Research]
▶ CombiMatrix to Present at the ROTH Conference   [Mar-09-16 06:00AM  GlobeNewswire]
▶ 8 Stocks Under $10 to Trade for Big Gains   [Mar-04-16 07:28AM  at TheStreet]
Financial statements of CBMX
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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