Intrinsic value of CenturyLink, Inc. - CTL

Previous Close

$11.80

  Intrinsic Value

$27.15

stock screener

  Rating & Target

str. buy

+130%

Previous close

$11.80

 
Intrinsic value

$27.15

 
Up/down potential

+130%

 
Rating

str. buy

We calculate the intrinsic value of CTL 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 12.7

 

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, %
  8.50
  8.15
  7.83
  7.55
  7.30
  7.07
  6.86
  6.67
  6.51
  6.36
  6.22
  6.10
  5.99
  5.89
  5.80
  5.72
  5.65
  5.58
  5.53
  5.47
  5.43
  5.38
  5.34
  5.31
  5.28
  5.25
  5.23
  5.20
  5.18
  5.16
Revenue, $m
  25,436
  27,509
  29,664
  31,904
  34,232
  36,651
  39,165
  41,779
  44,498
  47,326
  50,270
  53,335
  56,529
  59,859
  63,331
  66,954
  70,736
  74,685
  78,812
  83,125
  87,635
  92,352
  97,288
  102,455
  107,863
  113,528
  119,461
  125,677
  132,191
  139,018
Variable operating expenses, $m
  22,206
  23,700
  25,252
  26,866
  28,543
  30,286
  32,098
  33,981
  35,939
  37,977
  36,217
  38,425
  40,726
  43,125
  45,627
  48,237
  50,961
  53,807
  56,780
  59,887
  63,137
  66,535
  70,091
  73,813
  77,710
  81,791
  86,065
  90,544
  95,237
  100,156
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
  22,206
  23,700
  25,252
  26,866
  28,543
  30,286
  32,098
  33,981
  35,939
  37,977
  36,217
  38,425
  40,726
  43,125
  45,627
  48,237
  50,961
  53,807
  56,780
  59,887
  63,137
  66,535
  70,091
  73,813
  77,710
  81,791
  86,065
  90,544
  95,237
  100,156
Operating income, $m
  3,230
  3,809
  4,412
  5,038
  5,689
  6,365
  7,068
  7,798
  8,558
  9,349
  14,053
  14,910
  15,803
  16,733
  17,704
  18,717
  19,774
  20,878
  22,032
  23,238
  24,498
  25,817
  27,197
  28,641
  30,153
  31,737
  33,395
  35,133
  36,954
  38,863
EBITDA, $m
  10,986
  11,881
  12,812
  13,779
  14,785
  15,830
  16,915
  18,044
  19,218
  20,440
  21,711
  23,035
  24,415
  25,853
  27,353
  28,917
  30,551
  32,256
  34,039
  35,902
  37,850
  39,887
  42,019
  44,250
  46,586
  49,032
  51,595
  54,280
  57,093
  60,042
Interest expense (income), $m
  1,301
  2,128
  2,378
  2,641
  2,915
  3,199
  3,494
  3,801
  4,120
  4,451
  4,796
  5,155
  5,528
  5,917
  6,322
  6,744
  7,185
  7,644
  8,124
  8,625
  9,148
  9,695
  10,267
  10,866
  11,492
  12,147
  12,833
  13,551
  14,304
  15,092
  15,918
Earnings before tax, $m
  1,102
  1,431
  1,770
  2,123
  2,490
  2,871
  3,267
  3,679
  4,107
  4,553
  8,898
  9,382
  9,886
  10,411
  10,960
  11,532
  12,130
  12,754
  13,407
  14,089
  14,803
  15,550
  16,331
  17,150
  18,006
  18,904
  19,844
  20,829
  21,862
  22,944
Tax expense, $m
  298
  386
  478
  573
  672
  775
  882
  993
  1,109
  1,229
  2,402
  2,533
  2,669
  2,811
  2,959
  3,114
  3,275
  3,444
  3,620
  3,804
  3,997
  4,198
  4,409
  4,630
  4,862
  5,104
  5,358
  5,624
  5,903
  6,195
Net income, $m
  804
  1,044
  1,292
  1,550
  1,817
  2,096
  2,385
  2,685
  2,998
  3,324
  6,496
  6,849
  7,217
  7,600
  8,001
  8,419
  8,855
  9,311
  9,787
  10,285
  10,806
  11,351
  11,922
  12,519
  13,145
  13,800
  14,486
  15,205
  15,959
  16,749

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
  76,155
  82,361
  88,814
  95,521
  102,491
  109,733
  117,261
  125,087
  133,226
  141,694
  150,508
  159,686
  169,249
  179,217
  189,613
  200,460
  211,783
  223,609
  235,964
  248,878
  262,380
  276,504
  291,283
  306,750
  322,944
  339,903
  357,667
  376,278
  395,781
  416,223
Adjusted assets (=assets-cash), $m
  76,155
  82,361
  88,814
  95,521
  102,491
  109,733
  117,261
  125,087
  133,226
  141,694
  150,508
  159,686
  169,249
  179,217
  189,613
  200,460
  211,783
  223,609
  235,964
  248,878
  262,380
  276,504
  291,283
  306,750
  322,944
  339,903
  357,667
  376,278
  395,781
  416,223
Revenue / Adjusted assets
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
  0.334
Average production assets, $m
  51,151
  55,320
  59,654
  64,159
  68,840
  73,705
  78,761
  84,018
  89,485
  95,172
  101,092
  107,257
  113,680
  120,376
  127,358
  134,644
  142,249
  150,192
  158,491
  167,165
  176,234
  185,721
  195,647
  206,036
  216,913
  228,304
  240,235
  252,736
  265,836
  279,566
Working capital, $m
  -1,704
  -1,843
  -1,987
  -2,138
  -2,294
  -2,456
  -2,624
  -2,799
  -2,981
  -3,171
  -3,368
  -3,573
  -3,787
  -4,011
  -4,243
  -4,486
  -4,739
  -5,004
  -5,280
  -5,569
  -5,872
  -6,188
  -6,518
  -6,864
  -7,227
  -7,606
  -8,004
  -8,420
  -8,857
  -9,314
Total debt, $m
  40,312
  44,768
  49,402
  54,217
  59,221
  64,422
  69,826
  75,446
  81,289
  87,369
  93,698
  100,288
  107,154
  114,311
  121,775
  129,563
  137,693
  146,184
  155,055
  164,327
  174,022
  184,163
  194,774
  205,880
  217,507
  229,683
  242,438
  255,801
  269,804
  284,481
Total liabilities, $m
  54,679
  59,135
  63,769
  68,584
  73,588
  78,789
  84,193
  89,813
  95,656
  101,736
  108,065
  114,655
  121,521
  128,678
  136,142
  143,930
  152,060
  160,551
  169,422
  178,694
  188,389
  198,530
  209,141
  220,247
  231,874
  244,050
  256,805
  270,168
  284,171
  298,848
Total equity, $m
  21,476
  23,226
  25,046
  26,937
  28,902
  30,945
  33,068
  35,275
  37,570
  39,958
  42,443
  45,032
  47,728
  50,539
  53,471
  56,530
  59,723
  63,058
  66,542
  70,183
  73,991
  77,974
  82,142
  86,504
  91,070
  95,853
  100,862
  106,110
  111,610
  117,375
Total liabilities and equity, $m
  76,155
  82,361
  88,815
  95,521
  102,490
  109,734
  117,261
  125,088
  133,226
  141,694
  150,508
  159,687
  169,249
  179,217
  189,613
  200,460
  211,783
  223,609
  235,964
  248,877
  262,380
  276,504
  291,283
  306,751
  322,944
  339,903
  357,667
  376,278
  395,781
  416,223
Debt-to-equity ratio
  1.880
  1.930
  1.970
  2.010
  2.050
  2.080
  2.110
  2.140
  2.160
  2.190
  2.210
  2.230
  2.250
  2.260
  2.280
  2.290
  2.310
  2.320
  2.330
  2.340
  2.350
  2.360
  2.370
  2.380
  2.390
  2.400
  2.400
  2.410
  2.420
  2.420
Adjusted equity ratio
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  804
  1,044
  1,292
  1,550
  1,817
  2,096
  2,385
  2,685
  2,998
  3,324
  6,496
  6,849
  7,217
  7,600
  8,001
  8,419
  8,855
  9,311
  9,787
  10,285
  10,806
  11,351
  11,922
  12,519
  13,145
  13,800
  14,486
  15,205
  15,959
  16,749
Depreciation, amort., depletion, $m
  7,756
  8,072
  8,400
  8,742
  9,096
  9,465
  9,848
  10,246
  10,660
  11,091
  7,658
  8,126
  8,612
  9,119
  9,648
  10,200
  10,776
  11,378
  12,007
  12,664
  13,351
  14,070
  14,822
  15,609
  16,433
  17,296
  18,200
  19,147
  20,139
  21,179
Funds from operations, $m
  8,561
  9,116
  9,693
  10,291
  10,914
  11,560
  12,233
  12,931
  13,658
  14,415
  14,154
  14,974
  15,829
  16,720
  17,649
  18,619
  19,631
  20,689
  21,794
  22,949
  24,157
  25,421
  26,744
  28,128
  29,577
  31,096
  32,686
  34,352
  36,098
  37,929
Change in working capital, $m
  -134
  -139
  -144
  -150
  -156
  -162
  -168
  -175
  -182
  -189
  -197
  -205
  -214
  -223
  -233
  -243
  -253
  -265
  -276
  -289
  -302
  -316
  -331
  -346
  -362
  -380
  -398
  -416
  -436
  -457
Cash from operations, $m
  8,694
  9,255
  9,837
  10,441
  11,070
  11,722
  12,401
  13,106
  13,840
  14,604
  14,351
  15,180
  16,043
  16,943
  17,882
  18,862
  19,885
  20,954
  22,071
  23,238
  24,460
  25,737
  27,074
  28,474
  29,940
  31,475
  33,083
  34,768
  36,535
  38,386
Maintenance CAPEX, $m
  -3,572
  -3,875
  -4,191
  -4,519
  -4,861
  -5,215
  -5,584
  -5,967
  -6,365
  -6,779
  -7,210
  -7,658
  -8,126
  -8,612
  -9,119
  -9,648
  -10,200
  -10,776
  -11,378
  -12,007
  -12,664
  -13,351
  -14,070
  -14,822
  -15,609
  -16,433
  -17,296
  -18,200
  -19,147
  -20,139
New CAPEX, $m
  -4,007
  -4,169
  -4,334
  -4,505
  -4,681
  -4,865
  -5,056
  -5,257
  -5,467
  -5,688
  -5,920
  -6,165
  -6,423
  -6,695
  -6,983
  -7,286
  -7,605
  -7,943
  -8,299
  -8,674
  -9,070
  -9,487
  -9,926
  -10,389
  -10,877
  -11,391
  -11,931
  -12,501
  -13,100
  -13,730
Cash from investing activities, $m
  -7,579
  -8,044
  -8,525
  -9,024
  -9,542
  -10,080
  -10,640
  -11,224
  -11,832
  -12,467
  -13,130
  -13,823
  -14,549
  -15,307
  -16,102
  -16,934
  -17,805
  -18,719
  -19,677
  -20,681
  -21,734
  -22,838
  -23,996
  -25,211
  -26,486
  -27,824
  -29,227
  -30,701
  -32,247
  -33,869
Free cash flow, $m
  1,116
  1,211
  1,312
  1,417
  1,528
  1,643
  1,761
  1,883
  2,009
  2,137
  1,221
  1,356
  1,494
  1,635
  1,780
  1,928
  2,079
  2,234
  2,394
  2,557
  2,726
  2,900
  3,078
  3,263
  3,454
  3,651
  3,856
  4,068
  4,288
  4,517
Issuance/(repayment) of debt, $m
  4,251
  4,456
  4,633
  4,815
  5,004
  5,200
  5,405
  5,619
  5,844
  6,080
  6,328
  6,590
  6,866
  7,157
  7,464
  7,788
  8,130
  8,491
  8,871
  9,272
  9,695
  10,141
  10,611
  11,106
  11,627
  12,176
  12,754
  13,363
  14,003
  14,677
Issuance/(repurchase) of shares, $m
  843
  706
  527
  341
  148
  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  
  5,094
  5,162
  5,160
  5,156
  5,152
  5,200
  5,405
  5,619
  5,844
  6,080
  6,328
  6,590
  6,866
  7,157
  7,464
  7,788
  8,130
  8,491
  8,871
  9,272
  9,695
  10,141
  10,611
  11,106
  11,627
  12,176
  12,754
  13,363
  14,003
  14,677
Total cash flow (excl. dividends), $m
  6,210
  6,374
  6,472
  6,574
  6,680
  6,843
  7,166
  7,502
  7,852
  8,217
  7,550
  7,946
  8,360
  8,792
  9,244
  9,716
  10,209
  10,725
  11,265
  11,830
  12,421
  13,040
  13,689
  14,369
  15,081
  15,828
  16,610
  17,431
  18,291
  19,194
Retained Cash Flow (-), $m
  -1,648
  -1,750
  -1,820
  -1,891
  -1,965
  -2,042
  -2,123
  -2,207
  -2,295
  -2,388
  -2,486
  -2,588
  -2,697
  -2,811
  -2,932
  -3,059
  -3,193
  -3,335
  -3,484
  -3,642
  -3,808
  -3,983
  -4,167
  -4,362
  -4,567
  -4,782
  -5,009
  -5,248
  -5,500
  -5,765
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
  4,562
  4,623
  4,653
  4,683
  4,714
  4,800
  5,043
  5,295
  5,557
  5,829
  5,064
  5,358
  5,664
  5,981
  6,312
  6,657
  7,016
  7,390
  7,781
  8,188
  8,613
  9,058
  9,522
  10,007
  10,515
  11,045
  11,601
  12,183
  12,792
  13,429
Discount rate, %
  8.90
  9.35
  9.81
  10.30
  10.82
  11.36
  11.93
  12.52
  13.15
  13.81
  14.50
  15.22
  15.98
  16.78
  17.62
  18.50
  19.43
  20.40
  21.42
  22.49
  23.61
  24.80
  26.03
  27.34
  28.70
  30.14
  31.65
  33.23
  34.89
  36.63
PV of cash for distribution, $m
  4,190
  3,867
  3,514
  3,164
  2,821
  2,517
  2,292
  2,060
  1,828
  1,599
  1,142
  979
  824
  682
  553
  440
  343
  261
  195
  142
  100
  69
  46
  30
  19
  12
  7
  4
  2
  1
Current shareholders' claim on cash, %
  94.3
  90.0
  87.2
  85.5
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9
  84.9

CenturyLink, Inc. is an integrated communications company. The Company is engaged in providing an array of communications services to its residential and business customers. Its segments include Enterprise, which provides strategic, legacy and data integration products and services to small, medium and enterprise business, wholesale and governmental customers, including other communication providers, and Consumer, which provides strategic and legacy products and services to residential customers. Its communications services include local and long-distance voice, broadband, Multi-Protocol Label Switching (MPLS), private line (including special access), Ethernet, colocation, hosting (including cloud hosting and managed hosting), data integration, video, network, public access, Voice over Internet Protocol (VoIP), information technology and other ancillary services.

FINANCIAL RATIOS  of  CenturyLink, Inc. (CTL)

Valuation Ratios
P/E Ratio 10.3
Price to Sales 0.4
Price to Book 0.5
Price to Tangible Book
Price to Cash Flow 1.4
Price to Free Cash Flow 4
Growth Rates
Sales Growth Rate -2.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 3.8%
Cap. Spend. - 3 Yr. Gr. Rate -0.4%
Financial Strength
Quick Ratio 0
Current Ratio 0.5
LT Debt to Equity 135.7%
Total Debt to Equity 146.9%
Interest Coverage 2
Management Effectiveness
Return On Assets 3%
Ret/ On Assets - 3 Yr. Avg. 3.3%
Return On Total Capital 1.9%
Ret/ On T. Cap. - 3 Yr. Avg. 2.2%
Return On Equity 4.6%
Return On Equity - 3 Yr. Avg. 5.1%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 55.5%
Gross Margin - 3 Yr. Avg. 56.2%
EBITDA Margin 35.7%
EBITDA Margin - 3 Yr. Avg. 37.3%
Operating Margin 13.3%
Oper. Margin - 3 Yr. Avg. 13.8%
Pre-Tax Margin 5.8%
Pre-Tax Margin - 3 Yr. Avg. 6.4%
Net Profit Margin 3.6%
Net Profit Margin - 3 Yr. Avg. 4.3%
Effective Tax Rate 38.6%
Eff/ Tax Rate - 3 Yr. Avg. 34.1%
Payout Ratio 186.4%

CTL stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CTL stock intrinsic value calculation we used $23443 million for the last fiscal year's total revenue generated by CenturyLink, Inc.. The default revenue input number comes from 0001 income statement of CenturyLink, Inc.. 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 CTL stock valuation model: a) initial revenue growth rate of 8.5% 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 8.9%, whose default value for CTL is calculated based on our internal credit rating of CenturyLink, Inc., 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 CenturyLink, Inc..
    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 CTL stock the variable cost ratio is equal to 88.6%.

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 CTL 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 5.9% for CenturyLink, Inc..

Corporate tax rate of 27% is the nominal tax rate for CenturyLink, Inc.. 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 CTL 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 CTL are equal to 201.1%.

Life of production assets of 13.2 years is the average useful life of capital assets used in CenturyLink, Inc. 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 CTL is equal to -6.7%. 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 - $19828 million for CenturyLink, Inc. - 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 1079.404 million for CenturyLink, Inc. 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 CenturyLink, Inc. at the current share price and the inputted number of shares is $12.7 billion.

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