Intrinsic value of Carlisle Companies Incorporated - CSL

Previous Close

$129.84

  Intrinsic Value

$141.03

stock screener

  Rating & Target

hold

+9%

Previous close

$129.84

 
Intrinsic value

$141.03

 
Up/down potential

+9%

 
Rating

hold

We calculate the intrinsic value of CSL 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 7.4

 

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, %
  8.80
  8.42
  8.08
  7.77
  7.49
  7.24
  7.02
  6.82
  6.64
  6.47
  6.32
  6.19
  6.07
  5.97
  5.87
  5.78
  5.70
  5.63
  5.57
  5.51
  5.46
  5.42
  5.37
  5.34
  5.30
  5.27
  5.25
  5.22
  5.20
  5.18
Revenue, $m
  4,874
  5,285
  5,712
  6,155
  6,617
  7,096
  7,594
  8,112
  8,650
  9,210
  9,792
  10,399
  11,030
  11,688
  12,374
  13,090
  13,837
  14,616
  15,430
  16,281
  17,170
  18,100
  19,073
  20,091
  21,156
  22,272
  23,440
  24,664
  25,946
  27,290
Variable operating expenses, $m
  4,249
  4,586
  4,937
  5,302
  5,681
  6,075
  6,485
  6,910
  7,353
  7,813
  8,051
  8,550
  9,069
  9,610
  10,174
  10,763
  11,376
  12,017
  12,687
  13,386
  14,117
  14,882
  15,682
  16,519
  17,395
  18,312
  19,272
  20,279
  21,333
  22,438
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
  4,249
  4,586
  4,937
  5,302
  5,681
  6,075
  6,485
  6,910
  7,353
  7,813
  8,051
  8,550
  9,069
  9,610
  10,174
  10,763
  11,376
  12,017
  12,687
  13,386
  14,117
  14,882
  15,682
  16,519
  17,395
  18,312
  19,272
  20,279
  21,333
  22,438
Operating income, $m
  626
  699
  774
  853
  935
  1,021
  1,109
  1,201
  1,297
  1,396
  1,741
  1,849
  1,961
  2,078
  2,200
  2,327
  2,460
  2,599
  2,743
  2,895
  3,053
  3,218
  3,391
  3,572
  3,761
  3,960
  4,167
  4,385
  4,613
  4,852
EBITDA, $m
  995
  1,078
  1,165
  1,256
  1,350
  1,448
  1,550
  1,655
  1,765
  1,879
  1,998
  2,122
  2,251
  2,385
  2,525
  2,671
  2,823
  2,982
  3,148
  3,322
  3,503
  3,693
  3,892
  4,099
  4,317
  4,544
  4,783
  5,032
  5,294
  5,568
Interest expense (income), $m
  36
  86
  98
  111
  125
  139
  154
  169
  185
  202
  219
  237
  255
  275
  295
  316
  338
  361
  385
  410
  436
  463
  491
  521
  552
  584
  618
  654
  691
  731
  772
Earnings before tax, $m
  540
  600
  663
  728
  796
  867
  940
  1,016
  1,095
  1,178
  1,504
  1,593
  1,686
  1,783
  1,884
  1,989
  2,099
  2,214
  2,334
  2,459
  2,590
  2,727
  2,870
  3,020
  3,177
  3,341
  3,513
  3,694
  3,882
  4,080
Tax expense, $m
  146
  162
  179
  197
  215
  234
  254
  274
  296
  318
  406
  430
  455
  481
  509
  537
  567
  598
  630
  664
  699
  736
  775
  815
  858
  902
  949
  997
  1,048
  1,102
Net income, $m
  394
  438
  484
  532
  581
  633
  686
  742
  799
  860
  1,098
  1,163
  1,231
  1,302
  1,375
  1,452
  1,532
  1,616
  1,704
  1,795
  1,891
  1,991
  2,095
  2,205
  2,319
  2,439
  2,565
  2,696
  2,834
  2,979

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
  5,483
  5,944
  6,425
  6,924
  7,443
  7,982
  8,542
  9,125
  9,730
  10,360
  11,015
  11,697
  12,407
  13,148
  13,919
  14,724
  15,564
  16,441
  17,357
  18,314
  19,314
  20,360
  21,454
  22,599
  23,798
  25,052
  26,367
  27,743
  29,186
  30,697
Adjusted assets (=assets-cash), $m
  5,483
  5,944
  6,425
  6,924
  7,443
  7,982
  8,542
  9,125
  9,730
  10,360
  11,015
  11,697
  12,407
  13,148
  13,919
  14,724
  15,564
  16,441
  17,357
  18,314
  19,314
  20,360
  21,454
  22,599
  23,798
  25,052
  26,367
  27,743
  29,186
  30,697
Revenue / Adjusted assets
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
  0.889
Average production assets, $m
  2,150
  2,331
  2,519
  2,715
  2,918
  3,129
  3,349
  3,577
  3,815
  4,062
  4,318
  4,586
  4,864
  5,155
  5,457
  5,773
  6,102
  6,446
  6,805
  7,180
  7,572
  7,982
  8,411
  8,860
  9,330
  9,822
  10,337
  10,877
  11,442
  12,035
Working capital, $m
  717
  777
  840
  905
  973
  1,043
  1,116
  1,192
  1,272
  1,354
  1,439
  1,529
  1,621
  1,718
  1,819
  1,924
  2,034
  2,149
  2,268
  2,393
  2,524
  2,661
  2,804
  2,953
  3,110
  3,274
  3,446
  3,626
  3,814
  4,012
Total debt, $m
  1,820
  2,063
  2,315
  2,578
  2,851
  3,134
  3,429
  3,735
  4,054
  4,385
  4,730
  5,089
  5,462
  5,852
  6,258
  6,681
  7,123
  7,584
  8,066
  8,569
  9,095
  9,645
  10,221
  10,823
  11,454
  12,114
  12,805
  13,529
  14,288
  15,083
Total liabilities, $m
  2,884
  3,127
  3,379
  3,642
  3,915
  4,198
  4,493
  4,799
  5,118
  5,449
  5,794
  6,153
  6,526
  6,916
  7,322
  7,745
  8,187
  8,648
  9,130
  9,633
  10,159
  10,709
  11,285
  11,887
  12,518
  13,178
  13,869
  14,593
  15,352
  16,147
Total equity, $m
  2,599
  2,818
  3,045
  3,282
  3,528
  3,783
  4,049
  4,325
  4,612
  4,911
  5,221
  5,544
  5,881
  6,232
  6,598
  6,979
  7,377
  7,793
  8,227
  8,681
  9,155
  9,651
  10,169
  10,712
  11,280
  11,875
  12,498
  13,150
  13,834
  14,550
Total liabilities and equity, $m
  5,483
  5,945
  6,424
  6,924
  7,443
  7,981
  8,542
  9,124
  9,730
  10,360
  11,015
  11,697
  12,407
  13,148
  13,920
  14,724
  15,564
  16,441
  17,357
  18,314
  19,314
  20,360
  21,454
  22,599
  23,798
  25,053
  26,367
  27,743
  29,186
  30,697
Debt-to-equity ratio
  0.700
  0.730
  0.760
  0.790
  0.810
  0.830
  0.850
  0.860
  0.880
  0.890
  0.910
  0.920
  0.930
  0.940
  0.950
  0.960
  0.970
  0.970
  0.980
  0.990
  0.990
  1.000
  1.010
  1.010
  1.020
  1.020
  1.020
  1.030
  1.030
  1.040
Adjusted equity ratio
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474
  0.474

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  394
  438
  484
  532
  581
  633
  686
  742
  799
  860
  1,098
  1,163
  1,231
  1,302
  1,375
  1,452
  1,532
  1,616
  1,704
  1,795
  1,891
  1,991
  2,095
  2,205
  2,319
  2,439
  2,565
  2,696
  2,834
  2,979
Depreciation, amort., depletion, $m
  369
  380
  391
  403
  415
  427
  440
  454
  468
  483
  257
  273
  290
  307
  325
  344
  363
  384
  405
  427
  451
  475
  501
  527
  555
  585
  615
  647
  681
  716
Funds from operations, $m
  763
  818
  875
  934
  996
  1,060
  1,126
  1,196
  1,268
  1,342
  1,355
  1,436
  1,521
  1,609
  1,700
  1,796
  1,896
  2,000
  2,109
  2,223
  2,341
  2,466
  2,596
  2,732
  2,875
  3,024
  3,180
  3,344
  3,515
  3,695
Change in working capital, $m
  58
  60
  63
  65
  68
  70
  73
  76
  79
  82
  86
  89
  93
  97
  101
  105
  110
  115
  120
  125
  131
  137
  143
  150
  157
  164
  172
  180
  188
  198
Cash from operations, $m
  705
  758
  812
  869
  928
  989
  1,053
  1,120
  1,188
  1,260
  1,269
  1,347
  1,428
  1,512
  1,599
  1,691
  1,786
  1,885
  1,989
  2,097
  2,211
  2,329
  2,453
  2,582
  2,718
  2,860
  3,008
  3,164
  3,327
  3,498
Maintenance CAPEX, $m
  -118
  -128
  -139
  -150
  -162
  -174
  -186
  -199
  -213
  -227
  -242
  -257
  -273
  -290
  -307
  -325
  -344
  -363
  -384
  -405
  -427
  -451
  -475
  -501
  -527
  -555
  -585
  -615
  -647
  -681
New CAPEX, $m
  -172
  -181
  -188
  -196
  -203
  -211
  -220
  -228
  -237
  -247
  -257
  -267
  -279
  -290
  -303
  -316
  -329
  -344
  -359
  -375
  -392
  -410
  -429
  -449
  -470
  -492
  -515
  -540
  -565
  -593
Cash from investing activities, $m
  -290
  -309
  -327
  -346
  -365
  -385
  -406
  -427
  -450
  -474
  -499
  -524
  -552
  -580
  -610
  -641
  -673
  -707
  -743
  -780
  -819
  -861
  -904
  -950
  -997
  -1,047
  -1,100
  -1,155
  -1,212
  -1,274
Free cash flow, $m
  415
  449
  485
  523
  563
  604
  647
  692
  738
  786
  771
  823
  876
  932
  990
  1,050
  1,113
  1,178
  1,246
  1,317
  1,391
  1,468
  1,549
  1,633
  1,721
  1,812
  1,908
  2,009
  2,114
  2,224
Issuance/(repayment) of debt, $m
  232
  243
  253
  263
  273
  284
  295
  306
  318
  331
  345
  359
  374
  389
  406
  423
  442
  461
  482
  503
  526
  550
  576
  602
  630
  660
  691
  724
  759
  795
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
Cash from financing (excl. dividends), $m  
  232
  243
  253
  263
  273
  284
  295
  306
  318
  331
  345
  359
  374
  389
  406
  423
  442
  461
  482
  503
  526
  550
  576
  602
  630
  660
  691
  724
  759
  795
Total cash flow (excl. dividends), $m
  647
  692
  738
  786
  836
  888
  942
  998
  1,057
  1,117
  1,116
  1,181
  1,250
  1,321
  1,396
  1,474
  1,555
  1,640
  1,728
  1,821
  1,917
  2,019
  2,124
  2,235
  2,351
  2,473
  2,600
  2,733
  2,873
  3,019
Retained Cash Flow (-), $m
  -209
  -219
  -228
  -237
  -246
  -256
  -266
  -276
  -287
  -298
  -311
  -323
  -337
  -351
  -366
  -382
  -398
  -416
  -434
  -454
  -474
  -496
  -519
  -543
  -568
  -595
  -623
  -653
  -684
  -716
Prev. year cash balance distribution, $m
  208
  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
  646
  473
  510
  549
  590
  632
  676
  722
  770
  819
  805
  858
  913
  971
  1,030
  1,092
  1,157
  1,224
  1,294
  1,367
  1,443
  1,523
  1,606
  1,692
  1,783
  1,878
  1,977
  2,080
  2,189
  2,302
Discount rate, %
  4.40
  4.62
  4.85
  5.09
  5.35
  5.62
  5.90
  6.19
  6.50
  6.83
  7.17
  7.53
  7.90
  8.30
  8.71
  9.15
  9.60
  10.08
  10.59
  11.12
  11.67
  12.26
  12.87
  13.51
  14.19
  14.90
  15.64
  16.43
  17.25
  18.11
PV of cash for distribution, $m
  619
  432
  443
  450
  455
  456
  453
  447
  437
  423
  376
  359
  340
  318
  294
  269
  243
  217
  191
  166
  142
  120
  99
  81
  65
  51
  39
  29
  22
  16
Current shareholders' claim on cash, %
  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

Carlisle Companies Incorporated is a manufacturing company. The Company designs, manufactures and markets a range of products that serve a range of markets, including commercial roofing, energy, agriculture, mining, construction, aerospace and defense electronics, medical technology, transportation, general industrial, protective coatings, wood, auto refinishing, foodservice, and healthcare and sanitary maintenance. The Company operates through five segments: Carlisle Construction Materials (Construction Materials); Carlisle Interconnect Technologies (Interconnect Technologies); Carlisle Fluid Technologies (Fluid Technologies); Carlisle Brake & Friction (Brake & Friction), and Carlisle FoodService Products (FoodService Products). The Company markets its products as a component supplier to original equipment manufacturers and distributors, among others.

FINANCIAL RATIOS  of  Carlisle Companies Incorporated (CSL)

Valuation Ratios
P/E Ratio 33.5
Price to Sales 2.3
Price to Book 3.4
Price to Tangible Book
Price to Cash Flow 15.8
Price to Free Cash Flow 19.8
Growth Rates
Sales Growth Rate 3.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 51.4%
Cap. Spend. - 3 Yr. Gr. Rate -0.4%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 24.2%
Total Debt to Equity 24.2%
Interest Coverage 12
Management Effectiveness
Return On Assets 6.9%
Ret/ On Assets - 3 Yr. Avg. 7.8%
Return On Total Capital 8.1%
Ret/ On T. Cap. - 3 Yr. Avg. 9.2%
Return On Equity 10.4%
Return On Equity - 3 Yr. Avg. 12.1%
Asset Turnover 0.9
Profitability Ratios
Gross Margin 31.5%
Gross Margin - 3 Yr. Avg. 28.5%
EBITDA Margin 15.9%
EBITDA Margin - 3 Yr. Avg. 16.6%
Operating Margin 12%
Oper. Margin - 3 Yr. Avg. 13%
Pre-Tax Margin 11.2%
Pre-Tax Margin - 3 Yr. Avg. 12%
Net Profit Margin 6.8%
Net Profit Margin - 3 Yr. Avg. 7.9%
Effective Tax Rate 38.9%
Eff/ Tax Rate - 3 Yr. Avg. 34.5%
Payout Ratio 34%

CSL stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CSL stock intrinsic value calculation we used $4480 million for the last fiscal year's total revenue generated by Carlisle Companies Incorporated. The default revenue input number comes from 0001 income statement of Carlisle Companies Incorporated. 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 CSL stock valuation model: a) initial revenue growth rate of 8.8% 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 4.4%, whose default value for CSL is calculated based on our internal credit rating of Carlisle Companies Incorporated, 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 Carlisle Companies Incorporated.
    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 CSL stock the variable cost ratio is equal to 87.6%.

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 CSL 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 Carlisle Companies Incorporated.

Corporate tax rate of 27% is the nominal tax rate for Carlisle Companies Incorporated. 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 CSL 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 CSL are equal to 44.1%.

Life of production assets of 16.8 years is the average useful life of capital assets used in Carlisle Companies Incorporated 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 CSL is equal to 14.7%. 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 - $2597.4 million for Carlisle Companies Incorporated - 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 57.304 million for Carlisle Companies Incorporated 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 Carlisle Companies Incorporated at the current share price and the inputted number of shares is $7.4 billion.

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