Intrinsic value of CF Industries Holdings - CF

Previous Close

$39.56

  Intrinsic Value

$104.69

stock screener

  Rating & Target

str. buy

+165%

Previous close

$39.56

 
Intrinsic value

$104.69

 
Up/down potential

+165%

 
Rating

str. buy

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

We calculate the intrinsic value of CF 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

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

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, %
  -14.46
  27.90
  25.61
  23.55
  21.69
  20.02
  18.52
  17.17
  15.95
  14.86
  13.87
  12.98
  12.19
  11.47
  10.82
  10.24
  9.71
  9.24
  8.82
  8.44
  8.09
  7.78
  7.51
  7.26
  7.03
  6.83
  6.64
  6.48
  6.33
  6.20
  6.08
Revenue, $m
  3,685
  4,713
  5,920
  7,314
  8,901
  10,683
  12,662
  14,836
  17,203
  19,759
  22,500
  25,422
  28,520
  31,790
  35,230
  38,837
  42,610
  46,549
  50,654
  54,928
  59,374
  63,995
  68,799
  73,790
  78,977
  84,369
  89,974
  95,804
  101,870
  108,185
  114,761
Variable operating expenses, $m
 
  3,342
  4,138
  5,057
  6,104
  7,279
  8,584
  10,017
  11,578
  13,263
  15,070
  16,762
  18,805
  20,961
  23,230
  25,608
  28,096
  30,693
  33,400
  36,218
  39,149
  42,196
  45,363
  48,655
  52,075
  55,630
  59,326
  63,170
  67,170
  71,333
  75,669
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
  3,718
  3,342
  4,138
  5,057
  6,104
  7,279
  8,584
  10,017
  11,578
  13,263
  15,070
  16,762
  18,805
  20,961
  23,230
  25,608
  28,096
  30,693
  33,400
  36,218
  39,149
  42,196
  45,363
  48,655
  52,075
  55,630
  59,326
  63,170
  67,170
  71,333
  75,669
Operating income, $m
  -33
  1,371
  1,782
  2,257
  2,798
  3,405
  4,079
  4,819
  5,626
  6,496
  7,430
  8,660
  9,715
  10,829
  12,001
  13,229
  14,515
  15,856
  17,255
  18,711
  20,225
  21,799
  23,435
  25,136
  26,903
  28,739
  30,649
  32,634
  34,701
  36,852
  39,092
EBITDA, $m
  645
  2,296
  2,885
  3,564
  4,337
  5,205
  6,170
  7,229
  8,382
  9,628
  10,963
  12,387
  13,896
  15,490
  17,166
  18,923
  20,762
  22,681
  24,681
  26,763
  28,930
  31,181
  33,522
  35,954
  38,481
  41,108
  43,839
  46,680
  49,636
  52,712
  55,917
Interest expense (income), $m
  0
  202
  317
  452
  608
  786
  985
  1,207
  1,450
  1,715
  2,001
  2,307
  2,634
  2,981
  3,347
  3,732
  4,136
  4,558
  4,998
  5,458
  5,936
  6,433
  6,951
  7,488
  8,046
  8,627
  9,230
  9,857
  10,510
  11,188
  11,895
Earnings before tax, $m
  -226
  1,169
  1,465
  1,805
  2,189
  2,619
  3,093
  3,613
  4,176
  4,781
  5,429
  6,352
  7,081
  7,848
  8,654
  9,498
  10,379
  11,299
  12,256
  13,253
  14,289
  15,366
  16,485
  17,648
  18,856
  20,112
  21,418
  22,777
  24,191
  25,663
  27,197
Tax expense, $m
  -68
  316
  396
  487
  591
  707
  835
  975
  1,127
  1,291
  1,466
  1,715
  1,912
  2,119
  2,337
  2,564
  2,802
  3,051
  3,309
  3,578
  3,858
  4,149
  4,451
  4,765
  5,091
  5,430
  5,783
  6,150
  6,532
  6,929
  7,343
Net income, $m
  -277
  853
  1,069
  1,317
  1,598
  1,912
  2,258
  2,637
  3,048
  3,490
  3,963
  4,637
  5,169
  5,729
  6,317
  6,933
  7,577
  8,248
  8,947
  9,675
  10,431
  11,217
  12,034
  12,883
  13,765
  14,682
  15,635
  16,627
  17,659
  18,734
  19,854

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,164
  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
  15,131
  17,853
  22,425
  27,706
  33,716
  40,468
  47,963
  56,198
  65,164
  74,846
  85,228
  96,295
  108,029
  120,418
  133,448
  147,112
  161,403
  176,323
  191,873
  208,061
  224,900
  242,407
  260,601
  279,508
  299,157
  319,579
  340,812
  362,895
  385,872
  409,790
  434,700
Adjusted assets (=assets-cash), $m
  13,967
  17,853
  22,425
  27,706
  33,716
  40,468
  47,963
  56,198
  65,164
  74,846
  85,228
  96,295
  108,029
  120,418
  133,448
  147,112
  161,403
  176,323
  191,873
  208,061
  224,900
  242,407
  260,601
  279,508
  299,157
  319,579
  340,812
  362,895
  385,872
  409,790
  434,700
Revenue / Adjusted assets
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
  0.264
Average production assets, $m
  9,238
  11,816
  14,842
  18,337
  22,315
  26,783
  31,744
  37,195
  43,128
  49,536
  56,408
  63,732
  71,499
  79,698
  88,322
  97,366
  106,824
  116,699
  126,990
  137,705
  148,850
  160,437
  172,478
  184,992
  197,996
  211,513
  225,566
  240,181
  255,389
  271,219
  287,705
Working capital, $m
  1,969
  1,027
  1,291
  1,595
  1,940
  2,329
  2,760
  3,234
  3,750
  4,308
  4,905
  5,542
  6,217
  6,930
  7,680
  8,467
  9,289
  10,148
  11,043
  11,974
  12,943
  13,951
  14,998
  16,086
  17,217
  18,392
  19,614
  20,885
  22,208
  23,584
  25,018
Total debt, $m
  5,778
  9,063
  12,922
  17,379
  22,451
  28,150
  34,476
  41,426
  48,993
  57,165
  65,927
  75,268
  85,172
  95,628
  106,625
  118,157
  130,219
  142,811
  155,935
  169,599
  183,811
  198,586
  213,942
  229,900
  246,483
  263,720
  281,640
  300,278
  319,671
  339,858
  360,882
Total liabilities, $m
  11,783
  15,068
  18,927
  23,384
  28,456
  34,155
  40,481
  47,431
  54,998
  63,170
  71,932
  81,273
  91,177
  101,633
  112,630
  124,162
  136,224
  148,816
  161,940
  175,604
  189,816
  204,591
  219,947
  235,905
  252,488
  269,725
  287,645
  306,283
  325,676
  345,863
  366,887
Total equity, $m
  3,348
  2,785
  3,498
  4,322
  5,260
  6,313
  7,482
  8,767
  10,166
  11,676
  13,296
  15,022
  16,853
  18,785
  20,818
  22,949
  25,179
  27,506
  29,932
  32,458
  35,084
  37,815
  40,654
  43,603
  46,668
  49,854
  53,167
  56,612
  60,196
  63,927
  67,813
Total liabilities and equity, $m
  15,131
  17,853
  22,425
  27,706
  33,716
  40,468
  47,963
  56,198
  65,164
  74,846
  85,228
  96,295
  108,030
  120,418
  133,448
  147,111
  161,403
  176,322
  191,872
  208,062
  224,900
  242,406
  260,601
  279,508
  299,156
  319,579
  340,812
  362,895
  385,872
  409,790
  434,700
Debt-to-equity ratio
  1.726
  3.250
  3.690
  4.020
  4.270
  4.460
  4.610
  4.730
  4.820
  4.900
  4.960
  5.010
  5.050
  5.090
  5.120
  5.150
  5.170
  5.190
  5.210
  5.230
  5.240
  5.250
  5.260
  5.270
  5.280
  5.290
  5.300
  5.300
  5.310
  5.320
  5.320
Adjusted equity ratio
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156
  0.156

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -277
  853
  1,069
  1,317
  1,598
  1,912
  2,258
  2,637
  3,048
  3,490
  3,963
  4,637
  5,169
  5,729
  6,317
  6,933
  7,577
  8,248
  8,947
  9,675
  10,431
  11,217
  12,034
  12,883
  13,765
  14,682
  15,635
  16,627
  17,659
  18,734
  19,854
Depreciation, amort., depletion, $m
  678
  925
  1,102
  1,307
  1,539
  1,801
  2,091
  2,410
  2,757
  3,131
  3,533
  3,727
  4,181
  4,661
  5,165
  5,694
  6,247
  6,824
  7,426
  8,053
  8,705
  9,382
  10,086
  10,818
  11,579
  12,369
  13,191
  14,046
  14,935
  15,861
  16,825
Funds from operations, $m
  -127
  1,779
  2,172
  2,624
  3,138
  3,713
  4,349
  5,047
  5,805
  6,622
  7,496
  8,364
  9,350
  10,390
  11,482
  12,627
  13,824
  15,073
  16,373
  17,727
  19,136
  20,599
  22,120
  23,701
  25,344
  27,051
  28,826
  30,673
  32,594
  34,595
  36,678
Change in working capital, $m
  -744
  224
  263
  304
  346
  389
  431
  474
  516
  557
  598
  637
  675
  713
  750
  786
  823
  859
  895
  932
  969
  1,008
  1,047
  1,088
  1,131
  1,175
  1,222
  1,271
  1,322
  1,377
  1,434
Cash from operations, $m
  617
  1,555
  1,909
  2,320
  2,792
  3,324
  3,918
  4,573
  5,289
  6,065
  6,899
  7,727
  8,675
  9,677
  10,732
  11,841
  13,001
  14,214
  15,479
  16,796
  18,166
  19,592
  21,073
  22,613
  24,213
  25,876
  27,604
  29,402
  31,272
  33,218
  35,245
Maintenance CAPEX, $m
  0
  -540
  -691
  -868
  -1,072
  -1,305
  -1,566
  -1,856
  -2,175
  -2,522
  -2,897
  -3,299
  -3,727
  -4,181
  -4,661
  -5,165
  -5,694
  -6,247
  -6,824
  -7,426
  -8,053
  -8,705
  -9,382
  -10,086
  -10,818
  -11,579
  -12,369
  -13,191
  -14,046
  -14,935
  -15,861
New CAPEX, $m
  -2,211
  -2,578
  -3,026
  -3,495
  -3,978
  -4,468
  -4,961
  -5,450
  -5,934
  -6,408
  -6,872
  -7,324
  -7,767
  -8,199
  -8,624
  -9,043
  -9,459
  -9,874
  -10,292
  -10,714
  -11,145
  -11,587
  -12,042
  -12,514
  -13,004
  -13,517
  -14,053
  -14,616
  -15,207
  -15,830
  -16,486
Cash from investing activities, $m
  -2,177
  -3,118
  -3,717
  -4,363
  -5,050
  -5,773
  -6,527
  -7,306
  -8,109
  -8,930
  -9,769
  -10,623
  -11,494
  -12,380
  -13,285
  -14,208
  -15,153
  -16,121
  -17,116
  -18,140
  -19,198
  -20,292
  -21,424
  -22,600
  -23,822
  -25,096
  -26,422
  -27,807
  -29,253
  -30,765
  -32,347
Free cash flow, $m
  -1,560
  -1,564
  -1,808
  -2,043
  -2,259
  -2,449
  -2,609
  -2,734
  -2,820
  -2,865
  -2,870
  -2,896
  -2,819
  -2,704
  -2,552
  -2,367
  -2,152
  -1,907
  -1,638
  -1,345
  -1,032
  -700
  -351
  13
  390
  780
  1,182
  1,595
  2,019
  2,453
  2,898
Issuance/(repayment) of debt, $m
  74
  3,285
  3,859
  4,457
  5,073
  5,698
  6,326
  6,951
  7,567
  8,171
  8,763
  9,340
  9,904
  10,456
  10,998
  11,532
  12,062
  12,592
  13,124
  13,663
  14,212
  14,775
  15,356
  15,957
  16,583
  17,236
  17,920
  18,638
  19,393
  20,187
  21,024
Issuance/(repurchase) of shares, $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 financing (excl. dividends), $m  
  2,719
  3,285
  3,859
  4,457
  5,073
  5,698
  6,326
  6,951
  7,567
  8,171
  8,763
  9,340
  9,904
  10,456
  10,998
  11,532
  12,062
  12,592
  13,124
  13,663
  14,212
  14,775
  15,356
  15,957
  16,583
  17,236
  17,920
  18,638
  19,393
  20,187
  21,024
Total cash flow (excl. dividends), $m
  1,158
  1,721
  2,051
  2,414
  2,814
  3,249
  3,717
  4,217
  4,747
  5,306
  5,893
  6,444
  7,085
  7,752
  8,445
  9,165
  9,911
  10,684
  11,487
  12,318
  13,181
  14,076
  15,005
  15,970
  16,974
  18,017
  19,103
  20,234
  21,412
  22,640
  23,921
Retained Cash Flow (-), $m
  687
  -601
  -713
  -824
  -938
  -1,053
  -1,169
  -1,285
  -1,399
  -1,510
  -1,620
  -1,726
  -1,831
  -1,933
  -2,033
  -2,132
  -2,230
  -2,327
  -2,426
  -2,525
  -2,627
  -2,731
  -2,838
  -2,949
  -3,065
  -3,186
  -3,312
  -3,445
  -3,584
  -3,731
  -3,886
Prev. year cash balance distribution, $m
 
  1,164
  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
 
  2,284
  1,337
  1,591
  1,877
  2,196
  2,547
  2,932
  3,348
  3,796
  4,274
  4,718
  5,254
  5,819
  6,412
  7,033
  7,681
  8,357
  9,061
  9,793
  10,554
  11,345
  12,167
  13,021
  13,908
  14,831
  15,790
  16,789
  17,827
  18,909
  20,036
Discount rate, %
 
  7.30
  7.67
  8.05
  8.45
  8.87
  9.32
  9.78
  10.27
  10.79
  11.32
  11.89
  12.49
  13.11
  13.77
  14.45
  15.18
  15.93
  16.73
  17.57
  18.45
  19.37
  20.34
  21.35
  22.42
  23.54
  24.72
  25.96
  27.25
  28.62
  30.05
PV of cash for distribution, $m
 
  2,128
  1,154
  1,261
  1,357
  1,435
  1,493
  1,525
  1,531
  1,510
  1,462
  1,371
  1,280
  1,173
  1,054
  928
  801
  677
  559
  452
  357
  275
  207
  152
  108
  75
  51
  33
  21
  13
  8
Current shareholders' claim on cash, %
  100
  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
  100.0

CF Industries Holdings, Inc. manufactures and distributes nitrogen fertilizer, and other nitrogen products. The Company's nitrogen fertilizer products are ammonia, granular urea, urea ammonium nitrate solution (UAN) and ammonium nitrate (AN). Its other nitrogen products include diesel exhaust fluid (DEF), urea liquor, nitric acid and aqua ammonia, which are sold primarily to the Company's industrial customers, and compound fertilizer products (nitrogen, phosphorus and potassium or NPKs). The Company's segments include ammonia, granular urea, UAN, AN and other. The Company's ammonia segment produces anhydrous ammonia (ammonia), which is concentrated nitrogen fertilizer as it contains 82% nitrogen. The granular urea segment produces granular urea, which contains 46% nitrogen. The UAN segment produces urea ammonium nitrate solution. The Other segment includes DEF, urea liquor, nitric acid and NPKs. The Company's primary nitrogen fertilizer products are ammonia, granular urea, UAN and AN.

FINANCIAL RATIOS  of  CF Industries Holdings (CF)

Valuation Ratios
P/E Ratio -33.3
Price to Sales 2.5
Price to Book 2.8
Price to Tangible Book
Price to Cash Flow 14.9
Price to Free Cash Flow -5.8
Growth Rates
Sales Growth Rate -14.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -10.4%
Cap. Spend. - 3 Yr. Gr. Rate 21.8%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 172.6%
Total Debt to Equity 172.6%
Interest Coverage 0
Management Effectiveness
Return On Assets -2%
Ret/ On Assets - 3 Yr. Avg. 5.8%
Return On Total Capital -3%
Ret/ On T. Cap. - 3 Yr. Avg. 7%
Return On Equity -7.5%
Return On Equity - 3 Yr. Avg. 13.1%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 22.8%
Gross Margin - 3 Yr. Avg. 32.1%
EBITDA Margin 12.3%
EBITDA Margin - 3 Yr. Avg. 35.1%
Operating Margin -0.9%
Oper. Margin - 3 Yr. Avg. 25.6%
Pre-Tax Margin -6.1%
Pre-Tax Margin - 3 Yr. Avg. 21.5%
Net Profit Margin -7.5%
Net Profit Margin - 3 Yr. Avg. 12.7%
Effective Tax Rate 30.1%
Eff/ Tax Rate - 3 Yr. Avg. 34.3%
Payout Ratio -101.1%

CF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CF stock intrinsic value calculation we used $3685 million for the last fiscal year's total revenue generated by CF Industries Holdings. The default revenue input number comes from 2016 income statement of CF Industries Holdings. 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 CF stock valuation model: a) initial revenue growth rate of 27.9% 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 7.3%, whose default value for CF is calculated based on our internal credit rating of CF Industries Holdings, 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 CF Industries Holdings.
    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 CF stock the variable cost ratio is equal to 72.3%.

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 CF 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 CF Industries Holdings.

Corporate tax rate of 27% is the nominal tax rate for CF Industries Holdings. 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 CF 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 CF are equal to 250.7%.

Life of production assets of 17.1 years is the average useful life of capital assets used in CF Industries Holdings 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 CF is equal to 21.8%. 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 - $3348 million for CF Industries Holdings - 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 233.662 million for CF Industries Holdings 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 CF Industries Holdings at the current share price and the inputted number of shares is $9.2 billion.

RELATED COMPANIES Price Int.Val. Rating
UAN CVR Partners 3.83 1.24  str.sell
TNH Terra Nitrogen 84.25 106.73  buy
LXU LSB Industries 9.33 5.52  sell
MOS Mosaic 25.54 5.69  str.sell
POT Potash of Sask 20.65 2.42  str.sell

COMPANY NEWS

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▶ Why CF Industries Shipments Grew in 3Q17   [Nov-06-17 06:00PM  Market Realist]
▶ Why CF Industries Sales Grew 28% in 3Q17   [04:30PM  Market Realist]
▶ 7 Biggest Nitrogen Fertilizer Manufacturers in America   [Nov-05-17 09:45AM  Insider Monkey]
▶ CF reports 3Q loss   [Nov-01-17 04:40PM  Associated Press]
▶ Behind Mosaics Other Key Margin Expectations for 3Q17   [Oct-27-17 09:03AM  Market Realist]
▶ YourExpectation Report for Mosaics Upcoming 3Q17 Results   [Oct-26-17 03:22PM  Market Realist]
▶ Will CF Industries Report a Loss in 3Q17?   [Oct-23-17 09:10AM  Market Realist]
Financial statements of CF
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