Intrinsic value of CPFL Energia ADR - CPL

Previous Close

$14.12

  Intrinsic Value

$3,993

stock screener

  Rating & Target

str. buy

+999%

Previous close

$14.12

 
Intrinsic value

$3,993

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of CPL 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 0.1

 

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, %
  37.60
  34.34
  31.41
  28.77
  26.39
  24.25
  22.32
  20.59
  19.03
  17.63
  16.37
  15.23
  14.21
  13.29
  12.46
  11.71
  11.04
  10.44
  9.89
  9.40
  8.96
  8.57
  8.21
  7.89
  7.60
  7.34
  7.11
  6.90
  6.71
  6.54
Revenue, $m
  11,115
  14,932
  19,621
  25,265
  31,932
  39,676
  48,533
  58,528
  69,667
  81,950
  95,362
  109,886
  125,498
  142,172
  159,884
  178,609
  198,329
  219,028
  240,697
  263,332
  286,935
  311,517
  337,094
  363,688
  391,330
  420,055
  449,905
  480,929
  513,181
  546,719
Variable operating expenses, $m
  9,527
  12,689
  16,574
  21,250
  26,773
  33,187
  40,525
  48,804
  58,032
  68,207
  78,998
  91,030
  103,963
  117,776
  132,448
  147,961
  164,297
  181,444
  199,394
  218,145
  237,698
  258,062
  279,250
  301,281
  324,179
  347,975
  372,703
  398,404
  425,121
  452,905
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
  9,527
  12,689
  16,574
  21,250
  26,773
  33,187
  40,525
  48,804
  58,032
  68,207
  78,998
  91,030
  103,963
  117,776
  132,448
  147,961
  164,297
  181,444
  199,394
  218,145
  237,698
  258,062
  279,250
  301,281
  324,179
  347,975
  372,703
  398,404
  425,121
  452,905
Operating income, $m
  1,587
  2,242
  3,047
  4,016
  5,160
  6,488
  8,008
  9,723
  11,635
  13,742
  16,364
  18,856
  21,535
  24,396
  27,435
  30,649
  34,032
  37,584
  41,303
  45,187
  49,237
  53,455
  57,844
  62,407
  67,150
  72,080
  77,202
  82,525
  88,060
  93,815
EBITDA, $m
  2,376
  3,192
  4,194
  5,400
  6,825
  8,480
  10,374
  12,510
  14,891
  17,516
  20,383
  23,487
  26,824
  30,388
  34,174
  38,177
  42,392
  46,816
  51,447
  56,285
  61,331
  66,585
  72,052
  77,736
  83,644
  89,784
  96,164
  102,796
  109,689
  116,858
Interest expense (income), $m
  497
  676
  1,083
  1,595
  2,224
  2,981
  3,875
  4,914
  6,102
  7,443
  8,937
  10,584
  12,383
  14,331
  16,425
  18,661
  21,037
  23,549
  26,193
  28,970
  31,876
  34,912
  38,078
  41,375
  44,805
  48,372
  52,080
  55,932
  59,936
  64,097
  68,423
Earnings before tax, $m
  911
  1,159
  1,452
  1,791
  2,178
  2,613
  3,094
  3,621
  4,192
  4,806
  5,780
  6,473
  7,204
  7,971
  8,774
  9,612
  10,484
  11,391
  12,333
  13,310
  14,325
  15,377
  16,469
  17,602
  18,778
  20,000
  21,269
  22,589
  23,962
  25,392
Tax expense, $m
  246
  313
  392
  484
  588
  705
  835
  978
  1,132
  1,298
  1,561
  1,748
  1,945
  2,152
  2,369
  2,595
  2,831
  3,076
  3,330
  3,594
  3,868
  4,152
  4,447
  4,753
  5,070
  5,400
  5,743
  6,099
  6,470
  6,856
Net income, $m
  665
  846
  1,060
  1,308
  1,590
  1,907
  2,259
  2,643
  3,060
  3,508
  4,219
  4,725
  5,259
  5,819
  6,405
  7,016
  7,653
  8,315
  9,003
  9,717
  10,457
  11,225
  12,022
  12,849
  13,708
  14,600
  15,527
  16,490
  17,493
  18,536

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
  17,152
  23,043
  30,279
  38,989
  49,278
  61,228
  74,897
  90,320
  107,511
  126,465
  147,164
  169,577
  193,669
  219,401
  246,734
  275,631
  306,063
  338,007
  371,446
  406,376
  442,801
  480,736
  520,206
  561,247
  603,904
  648,232
  694,298
  742,174
  791,945
  843,703
Adjusted assets (=assets-cash), $m
  17,152
  23,043
  30,279
  38,989
  49,278
  61,228
  74,897
  90,320
  107,511
  126,465
  147,164
  169,577
  193,669
  219,401
  246,734
  275,631
  306,063
  338,007
  371,446
  406,376
  442,801
  480,736
  520,206
  561,247
  603,904
  648,232
  694,298
  742,174
  791,945
  843,703
Revenue / Adjusted assets
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
  0.648
Average production assets, $m
  6,324
  8,496
  11,164
  14,376
  18,169
  22,576
  27,615
  33,302
  39,641
  46,629
  54,261
  62,525
  71,408
  80,896
  90,974
  101,629
  112,849
  124,627
  136,957
  149,836
  163,266
  177,253
  191,806
  206,938
  222,667
  239,011
  255,996
  273,649
  292,000
  311,083
Working capital, $m
  100
  134
  177
  227
  287
  357
  437
  527
  627
  738
  858
  989
  1,129
  1,280
  1,439
  1,607
  1,785
  1,971
  2,166
  2,370
  2,582
  2,804
  3,034
  3,273
  3,522
  3,780
  4,049
  4,328
  4,619
  4,920
Total debt, $m
  9,760
  14,372
  20,038
  26,858
  34,914
  44,271
  54,974
  67,050
  80,511
  95,352
  111,559
  129,109
  147,973
  168,121
  189,522
  212,149
  235,977
  260,989
  287,172
  314,522
  343,043
  372,746
  403,651
  435,786
  469,186
  503,895
  539,965
  577,452
  616,423
  656,949
Total liabilities, $m
  13,430
  18,042
  23,709
  30,529
  38,585
  47,942
  58,644
  70,721
  84,181
  99,022
  115,229
  132,779
  151,643
  171,791
  193,193
  215,819
  239,648
  264,659
  290,842
  318,192
  346,713
  376,416
  407,321
  439,456
  472,857
  507,566
  543,635
  581,122
  620,093
  660,619
Total equity, $m
  3,722
  5,000
  6,571
  8,461
  10,693
  13,286
  16,253
  19,600
  23,330
  27,443
  31,935
  36,798
  42,026
  47,610
  53,541
  59,812
  66,416
  73,347
  80,604
  88,184
  96,088
  104,320
  112,885
  121,791
  131,047
  140,666
  150,663
  161,052
  171,852
  183,084
Total liabilities and equity, $m
  17,152
  23,042
  30,280
  38,990
  49,278
  61,228
  74,897
  90,321
  107,511
  126,465
  147,164
  169,577
  193,669
  219,401
  246,734
  275,631
  306,064
  338,006
  371,446
  406,376
  442,801
  480,736
  520,206
  561,247
  603,904
  648,232
  694,298
  742,174
  791,945
  843,703
Debt-to-equity ratio
  2.620
  2.870
  3.050
  3.170
  3.270
  3.330
  3.380
  3.420
  3.450
  3.470
  3.490
  3.510
  3.520
  3.530
  3.540
  3.550
  3.550
  3.560
  3.560
  3.570
  3.570
  3.570
  3.580
  3.580
  3.580
  3.580
  3.580
  3.590
  3.590
  3.590
Adjusted equity ratio
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  665
  846
  1,060
  1,308
  1,590
  1,907
  2,259
  2,643
  3,060
  3,508
  4,219
  4,725
  5,259
  5,819
  6,405
  7,016
  7,653
  8,315
  9,003
  9,717
  10,457
  11,225
  12,022
  12,849
  13,708
  14,600
  15,527
  16,490
  17,493
  18,536
Depreciation, amort., depletion, $m
  788
  949
  1,147
  1,385
  1,666
  1,992
  2,365
  2,787
  3,256
  3,774
  4,019
  4,631
  5,289
  5,992
  6,739
  7,528
  8,359
  9,232
  10,145
  11,099
  12,094
  13,130
  14,208
  15,329
  16,494
  17,705
  18,963
  20,270
  21,630
  23,043
Funds from operations, $m
  1,454
  1,795
  2,207
  2,692
  3,256
  3,899
  4,624
  5,430
  6,316
  7,282
  8,238
  9,357
  10,548
  11,811
  13,144
  14,545
  16,012
  17,547
  19,148
  20,816
  22,551
  24,355
  26,230
  28,178
  30,202
  32,304
  34,489
  36,760
  39,122
  41,579
Change in working capital, $m
  27
  34
  42
  51
  60
  70
  80
  90
  100
  111
  121
  131
  141
  150
  159
  169
  177
  186
  195
  204
  212
  221
  230
  239
  249
  259
  269
  279
  290
  302
Cash from operations, $m
  1,426
  1,761
  2,164
  2,642
  3,196
  3,830
  4,544
  5,340
  6,216
  7,171
  8,118
  9,226
  10,408
  11,661
  12,984
  14,376
  15,835
  17,361
  18,953
  20,612
  22,339
  24,134
  26,000
  27,939
  29,953
  32,046
  34,221
  36,481
  38,832
  41,277
Maintenance CAPEX, $m
  -340
  -468
  -629
  -827
  -1,065
  -1,346
  -1,672
  -2,046
  -2,467
  -2,936
  -3,454
  -4,019
  -4,631
  -5,289
  -5,992
  -6,739
  -7,528
  -8,359
  -9,232
  -10,145
  -11,099
  -12,094
  -13,130
  -14,208
  -15,329
  -16,494
  -17,705
  -18,963
  -20,270
  -21,630
New CAPEX, $m
  -1,728
  -2,172
  -2,668
  -3,211
  -3,794
  -4,406
  -5,040
  -5,687
  -6,338
  -6,989
  -7,632
  -8,264
  -8,883
  -9,488
  -10,078
  -10,655
  -11,221
  -11,778
  -12,329
  -12,879
  -13,430
  -13,987
  -14,553
  -15,132
  -15,728
  -16,344
  -16,985
  -17,653
  -18,351
  -19,084
Cash from investing activities, $m
  -2,068
  -2,640
  -3,297
  -4,038
  -4,859
  -5,752
  -6,712
  -7,733
  -8,805
  -9,925
  -11,086
  -12,283
  -13,514
  -14,777
  -16,070
  -17,394
  -18,749
  -20,137
  -21,561
  -23,024
  -24,529
  -26,081
  -27,683
  -29,340
  -31,057
  -32,838
  -34,690
  -36,616
  -38,621
  -40,714
Free cash flow, $m
  -642
  -879
  -1,133
  -1,397
  -1,663
  -1,922
  -2,168
  -2,392
  -2,589
  -2,754
  -2,968
  -3,057
  -3,107
  -3,116
  -3,086
  -3,018
  -2,914
  -2,776
  -2,608
  -2,412
  -2,191
  -1,947
  -1,683
  -1,401
  -1,104
  -792
  -469
  -134
  210
  564
Issuance/(repayment) of debt, $m
  3,669
  4,612
  5,666
  6,820
  8,056
  9,357
  10,703
  12,076
  13,460
  14,841
  16,207
  17,550
  18,864
  20,148
  21,401
  22,627
  23,828
  25,011
  26,183
  27,350
  28,521
  29,703
  30,905
  32,135
  33,400
  34,709
  36,069
  37,487
  38,971
  40,526
Issuance/(repurchase) of shares, $m
  350
  432
  511
  582
  642
  686
  707
  703
  670
  605
  272
  138
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  4,019
  5,044
  6,177
  7,402
  8,698
  10,043
  11,410
  12,779
  14,130
  15,446
  16,479
  17,688
  18,864
  20,148
  21,401
  22,627
  23,828
  25,011
  26,183
  27,350
  28,521
  29,703
  30,905
  32,135
  33,400
  34,709
  36,069
  37,487
  38,971
  40,526
Total cash flow (excl. dividends), $m
  3,377
  4,165
  5,044
  6,005
  7,036
  8,120
  9,243
  10,388
  11,541
  12,692
  13,511
  14,631
  15,757
  17,032
  18,316
  19,609
  20,915
  22,235
  23,575
  24,938
  26,330
  27,756
  29,222
  30,734
  32,297
  33,917
  35,600
  37,353
  39,181
  41,090
Retained Cash Flow (-), $m
  -1,015
  -1,278
  -1,570
  -1,890
  -2,233
  -2,593
  -2,966
  -3,347
  -3,730
  -4,113
  -4,492
  -4,864
  -5,228
  -5,584
  -5,931
  -6,271
  -6,604
  -6,932
  -7,256
  -7,580
  -7,904
  -8,232
  -8,565
  -8,906
  -9,257
  -9,619
  -9,996
  -10,389
  -10,800
  -11,231
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
  2,361
  2,887
  3,473
  4,115
  4,803
  5,527
  6,276
  7,041
  7,811
  8,579
  9,020
  9,767
  10,529
  11,448
  12,384
  13,338
  14,311
  15,303
  16,318
  17,358
  18,426
  19,524
  20,657
  21,828
  23,040
  24,298
  25,604
  26,964
  28,381
  29,859
Discount rate, %
  8.00
  8.40
  8.82
  9.26
  9.72
  10.21
  10.72
  11.26
  11.82
  12.41
  13.03
  13.68
  14.37
  15.09
  15.84
  16.63
  17.46
  18.34
  19.25
  20.22
  21.23
  22.29
  23.40
  24.57
  25.80
  27.09
  28.45
  29.87
  31.36
  32.93
PV of cash for distribution, $m
  2,186
  2,457
  2,695
  2,888
  3,020
  3,084
  3,077
  2,999
  2,858
  2,663
  2,344
  2,096
  1,839
  1,601
  1,365
  1,138
  928
  739
  575
  437
  324
  233
  164
  112
  74
  48
  30
  18
  10
  6
Current shareholders' claim on cash, %
  84.4
  72.4
  63.2
  56.1
  50.6
  46.3
  43.1
  40.6
  38.7
  37.3
  36.8
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5
  36.5

CPFL Energia S.A. is a holding company. The Company, through its subsidiaries, distributes, generates, transmits and commercializes electricity in Brazil, as well as provides energy-related services. Its segments include Distribution, Conventional Generation Sources, Renewable Energy Generation, Commercialization and Services. The Company operates its distribution segment through its eight distributors. Its installed capacity in conventional generation is approximately 2,200 megawatt (MW). The Company, through its subsidiary CPFL Geracao, holds equity interests in eight Hydroelectric Power Plants. It operates in the segment of generation of energy of renewable sources, such as wind, biomass thermal plants, SHPPs and solar, through its subsidiary, CPFL Renovaveis. The Company operates in the segment of commercialization (power competitive supply) through its subsidiary, CPFL Brasil. The Company operates in the segment of value-added services providing electricity-related services.

FINANCIAL RATIOS  of  CPFL Energia ADR (CPL)

Valuation Ratios
P/E Ratio 50.4
Price to Sales 2.4
Price to Book 5.7
Price to Tangible Book
Price to Cash Flow 9.8
Price to Free Cash Flow 19
Growth Rates
Sales Growth Rate -7.2%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 57%
Cap. Spend. - 3 Yr. Gr. Rate 5.2%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 237.6%
Total Debt to Equity 284.2%
Interest Coverage 2
Management Effectiveness
Return On Assets 4.6%
Ret/ On Assets - 3 Yr. Avg. 4.9%
Return On Total Capital 3%
Ret/ On T. Cap. - 3 Yr. Avg. 3.3%
Return On Equity 11.5%
Return On Equity - 3 Yr. Avg. 12.3%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 22.2%
EBITDA Margin - 3 Yr. Avg. 22.1%
Operating Margin 14.8%
Oper. Margin - 3 Yr. Avg. 14.7%
Pre-Tax Margin 7.2%
Pre-Tax Margin - 3 Yr. Avg. 7.7%
Net Profit Margin 4.7%
Net Profit Margin - 3 Yr. Avg. 4.8%
Effective Tax Rate 36.2%
Eff/ Tax Rate - 3 Yr. Avg. 39.1%
Payout Ratio 25.6%

CPL stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CPL stock intrinsic value calculation we used $8077.59136213 million for the last fiscal year's total revenue generated by CPFL Energia ADR. The default revenue input number comes from 0001 income statement of CPFL Energia ADR. 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 CPL stock valuation model: a) initial revenue growth rate of 37.6% 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 8%, whose default value for CPL is calculated based on our internal credit rating of CPFL Energia ADR, 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 CPFL Energia ADR.
    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 CPL stock the variable cost ratio is equal to 86.8%.

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 CPL 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 11.1% for CPFL Energia ADR.

Corporate tax rate of 27% is the nominal tax rate for CPFL Energia ADR. 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 CPL 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 CPL are equal to 56.9%.

Life of production assets of 13.5 years is the average useful life of capital assets used in CPFL Energia ADR 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 CPL is equal to 0.9%. 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 - $2706.59257022 million for CPFL Energia ADR - 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 4.933 million for CPFL Energia ADR 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 CPFL Energia ADR at the current share price and the inputted number of shares is $0.1 billion.

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COMPANY NEWS

▶ Is Comperiapl S.A. (WSE:CPL) A Financially Sound Company?   [Mar-20-18 10:18AM  Simply Wall St.]
▶ ETFs with exposure to CPFL Energia SA : December 11, 2017   [Dec-11-17 01:43PM  Capital Cube]
▶ ETFs with exposure to CPFL Energia SA : November 8, 2017   [Nov-08-17 05:47PM  Capital Cube]
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▶ ETFs with exposure to CPFL Energia SA : August 4, 2017   [Aug-03-17 08:02PM  Capital Cube]
▶ ETFs with exposure to CPFL Energia SA : July 13, 2017   [Jul-13-17 03:47PM  Capital Cube]
▶ ETFs with exposure to CPFL Energia SA : May 19, 2017   [May-19-17 01:46PM  Capital Cube]
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▶ ETFs with exposure to CPFL Energia SA : January 12, 2017   [Jan-12-17 01:56PM  Capital Cube]
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