Intrinsic value of Civeo Corporation - CVEO

Previous Close

$2.13

  Intrinsic Value

$0.45

stock screener

  Rating & Target

str. sell

-79%

Previous close

$2.13

 
Intrinsic value

$0.45

 
Up/down potential

-79%

 
Rating

str. sell

We calculate the intrinsic value of CVEO 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 0.4

 

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, %
  13.00
  12.20
  11.48
  10.83
  10.25
  9.72
  9.25
  8.83
  8.44
  8.10
  7.79
  7.51
  7.26
  7.03
  6.83
  6.65
  6.48
  6.33
  6.20
  6.08
  5.97
  5.88
  5.79
  5.71
  5.64
  5.57
  5.52
  5.47
  5.42
  5.38
Revenue, $m
  528
  592
  660
  732
  807
  885
  967
  1,052
  1,141
  1,233
  1,330
  1,429
  1,533
  1,641
  1,753
  1,870
  1,991
  2,117
  2,248
  2,385
  2,527
  2,676
  2,831
  2,992
  3,161
  3,337
  3,521
  3,714
  3,915
  4,125
Variable operating expenses, $m
  461
  515
  571
  631
  693
  758
  826
  897
  970
  1,047
  1,103
  1,186
  1,272
  1,362
  1,455
  1,552
  1,652
  1,757
  1,866
  1,979
  2,097
  2,221
  2,349
  2,483
  2,623
  2,769
  2,922
  3,082
  3,249
  3,424
Fixed operating expenses, $m
  150
  154
  157
  160
  164
  168
  171
  175
  179
  183
  187
  191
  195
  199
  204
  208
  213
  217
  222
  227
  232
  237
  242
  248
  253
  259
  265
  270
  276
  282
Total operating expenses, $m
  611
  669
  728
  791
  857
  926
  997
  1,072
  1,149
  1,230
  1,290
  1,377
  1,467
  1,561
  1,659
  1,760
  1,865
  1,974
  2,088
  2,206
  2,329
  2,458
  2,591
  2,731
  2,876
  3,028
  3,187
  3,352
  3,525
  3,706
Operating income, $m
  -84
  -76
  -68
  -59
  -50
  -40
  -30
  -19
  -8
  4
  39
  52
  66
  80
  94
  110
  126
  143
  160
  179
  198
  218
  239
  261
  284
  309
  334
  361
  390
  419
EBITDA, $m
  70
  94
  119
  145
  173
  202
  233
  265
  298
  333
  369
  406
  446
  486
  529
  573
  619
  667
  717
  769
  824
  881
  940
  1,003
  1,068
  1,136
  1,207
  1,282
  1,360
  1,442
Interest expense (income), $m
  0
  29
  34
  39
  44
  50
  56
  62
  68
  75
  82
  89
  96
  104
  112
  121
  129
  138
  148
  158
  168
  179
  190
  201
  213
  226
  239
  253
  267
  282
  298
Earnings before tax, $m
  -113
  -110
  -107
  -104
  -100
  -96
  -92
  -88
  -83
  -78
  -50
  -44
  -38
  -33
  -26
  -20
  -13
  -5
  2
  11
  19
  28
  38
  48
  59
  70
  82
  94
  108
  122
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  3
  5
  8
  10
  13
  16
  19
  22
  25
  29
  33
Net income, $m
  -113
  -110
  -107
  -104
  -100
  -96
  -92
  -88
  -83
  -78
  -50
  -44
  -38
  -33
  -26
  -20
  -13
  -5
  2
  8
  14
  21
  28
  35
  43
  51
  60
  69
  79
  89

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
  1,132
  1,271
  1,416
  1,570
  1,731
  1,899
  2,075
  2,258
  2,449
  2,647
  2,853
  3,067
  3,290
  3,521
  3,762
  4,012
  4,272
  4,543
  4,824
  5,118
  5,423
  5,742
  6,074
  6,421
  6,783
  7,161
  7,556
  7,969
  8,401
  8,853
Adjusted assets (=assets-cash), $m
  1,132
  1,271
  1,416
  1,570
  1,731
  1,899
  2,075
  2,258
  2,449
  2,647
  2,853
  3,067
  3,290
  3,521
  3,762
  4,012
  4,272
  4,543
  4,824
  5,118
  5,423
  5,742
  6,074
  6,421
  6,783
  7,161
  7,556
  7,969
  8,401
  8,853
Revenue / Adjusted assets
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
  0.466
Average production assets, $m
  837
  939
  1,047
  1,160
  1,279
  1,404
  1,533
  1,669
  1,810
  1,956
  2,109
  2,267
  2,432
  2,603
  2,780
  2,965
  3,157
  3,357
  3,566
  3,782
  4,008
  4,244
  4,489
  4,746
  5,013
  5,293
  5,585
  5,890
  6,209
  6,543
Working capital, $m
  47
  53
  59
  66
  73
  80
  87
  95
  103
  111
  120
  129
  138
  148
  158
  168
  179
  191
  202
  215
  227
  241
  255
  269
  284
  300
  317
  334
  352
  371
Total debt, $m
  437
  501
  569
  640
  715
  793
  875
  960
  1,049
  1,141
  1,237
  1,336
  1,440
  1,547
  1,659
  1,776
  1,896
  2,022
  2,153
  2,290
  2,432
  2,580
  2,735
  2,896
  3,064
  3,240
  3,424
  3,616
  3,816
  4,027
Total liabilities, $m
  527
  591
  659
  730
  805
  883
  965
  1,050
  1,139
  1,231
  1,327
  1,426
  1,530
  1,637
  1,749
  1,866
  1,986
  2,112
  2,243
  2,380
  2,522
  2,670
  2,825
  2,986
  3,154
  3,330
  3,514
  3,706
  3,906
  4,117
Total equity, $m
  606
  680
  758
  840
  926
  1,016
  1,110
  1,208
  1,310
  1,416
  1,526
  1,641
  1,760
  1,884
  2,013
  2,146
  2,286
  2,430
  2,581
  2,738
  2,901
  3,072
  3,250
  3,435
  3,629
  3,831
  4,043
  4,264
  4,495
  4,736
Total liabilities and equity, $m
  1,133
  1,271
  1,417
  1,570
  1,731
  1,899
  2,075
  2,258
  2,449
  2,647
  2,853
  3,067
  3,290
  3,521
  3,762
  4,012
  4,272
  4,542
  4,824
  5,118
  5,423
  5,742
  6,075
  6,421
  6,783
  7,161
  7,557
  7,970
  8,401
  8,853
Debt-to-equity ratio
  0.720
  0.740
  0.750
  0.760
  0.770
  0.780
  0.790
  0.790
  0.800
  0.810
  0.810
  0.810
  0.820
  0.820
  0.820
  0.830
  0.830
  0.830
  0.830
  0.840
  0.840
  0.840
  0.840
  0.840
  0.840
  0.850
  0.850
  0.850
  0.850
  0.850
Adjusted equity ratio
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535
  0.535

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -113
  -110
  -107
  -104
  -100
  -96
  -92
  -88
  -83
  -78
  -50
  -44
  -38
  -33
  -26
  -20
  -13
  -5
  2
  8
  14
  21
  28
  35
  43
  51
  60
  69
  79
  89
Depreciation, amort., depletion, $m
  154
  170
  187
  205
  223
  243
  263
  284
  306
  329
  329
  354
  380
  407
  434
  463
  493
  525
  557
  591
  626
  663
  701
  742
  783
  827
  873
  920
  970
  1,022
Funds from operations, $m
  41
  60
  80
  101
  123
  147
  171
  197
  223
  251
  280
  310
  341
  374
  408
  444
  481
  519
  559
  599
  640
  684
  729
  776
  826
  878
  932
  989
  1,049
  1,111
Change in working capital, $m
  5
  6
  6
  6
  7
  7
  7
  8
  8
  8
  9
  9
  9
  10
  10
  10
  11
  11
  12
  12
  13
  13
  14
  15
  15
  16
  17
  17
  18
  19
Cash from operations, $m
  35
  54
  74
  95
  117
  140
  164
  189
  215
  243
  271
  301
  332
  364
  398
  433
  470
  508
  547
  586
  627
  670
  715
  762
  811
  862
  916
  972
  1,031
  1,092
Maintenance CAPEX, $m
  -116
  -131
  -147
  -164
  -181
  -200
  -219
  -240
  -261
  -283
  -306
  -329
  -354
  -380
  -407
  -434
  -463
  -493
  -525
  -557
  -591
  -626
  -663
  -701
  -742
  -783
  -827
  -873
  -920
  -970
New CAPEX, $m
  -96
  -102
  -108
  -113
  -119
  -124
  -130
  -135
  -141
  -147
  -152
  -158
  -165
  -171
  -178
  -185
  -192
  -200
  -208
  -217
  -226
  -235
  -246
  -256
  -268
  -279
  -292
  -305
  -319
  -334
Cash from investing activities, $m
  -212
  -233
  -255
  -277
  -300
  -324
  -349
  -375
  -402
  -430
  -458
  -487
  -519
  -551
  -585
  -619
  -655
  -693
  -733
  -774
  -817
  -861
  -909
  -957
  -1,010
  -1,062
  -1,119
  -1,178
  -1,239
  -1,304
Free cash flow, $m
  -177
  -179
  -181
  -182
  -184
  -185
  -186
  -186
  -186
  -187
  -187
  -187
  -187
  -187
  -186
  -186
  -186
  -185
  -186
  -188
  -189
  -191
  -194
  -196
  -198
  -201
  -203
  -206
  -209
  -212
Issuance/(repayment) of debt, $m
  60
  64
  68
  71
  75
  78
  82
  85
  89
  92
  96
  100
  104
  108
  112
  116
  121
  126
  131
  136
  142
  148
  155
  161
  168
  176
  184
  192
  201
  210
Issuance/(repurchase) of shares, $m
  184
  184
  185
  186
  186
  186
  186
  186
  185
  184
  160
  159
  158
  156
  155
  153
  152
  150
  149
  149
  150
  150
  150
  151
  151
  151
  152
  152
  152
  153
Cash from financing (excl. dividends), $m  
  244
  248
  253
  257
  261
  264
  268
  271
  274
  276
  256
  259
  262
  264
  267
  269
  273
  276
  280
  285
  292
  298
  305
  312
  319
  327
  336
  344
  353
  363
Total cash flow (excl. dividends), $m
  67
  70
  72
  75
  77
  80
  82
  85
  87
  90
  69
  72
  74
  77
  80
  84
  87
  91
  94
  98
  102
  107
  111
  116
  121
  126
  132
  138
  144
  151
Retained Cash Flow (-), $m
  -184
  -184
  -185
  -186
  -186
  -186
  -186
  -186
  -185
  -184
  -160
  -159
  -158
  -156
  -155
  -153
  -152
  -150
  -151
  -157
  -164
  -170
  -178
  -186
  -194
  -202
  -211
  -221
  -231
  -242
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
  -116
  -115
  -113
  -111
  -109
  -106
  -104
  -101
  -98
  -94
  -91
  -87
  -83
  -79
  -74
  -70
  -65
  -60
  -56
  -59
  -61
  -64
  -67
  -70
  -73
  -76
  -79
  -83
  -87
  -91
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
  -108
  -99
  -90
  -80
  -71
  -62
  -54
  -46
  -39
  -32
  -26
  -21
  -17
  -13
  -10
  -7
  -5
  -4
  -3
  -2
  -1
  -1
  -1
  -1
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  67.1
  46.8
  33.7
  24.9
  19.0
  14.7
  11.7
  9.4
  7.7
  6.4
  5.5
  4.8
  4.2
  3.8
  3.4
  3.0
  2.8
  2.5
  2.3
  2.1
  2.0
  1.9
  1.7
  1.6
  1.5
  1.4
  1.4
  1.3
  1.2
  1.2

Civeo Corporation provides remote site accommodation, logistics, and facility management services to the natural resource industry in Australia, Canada, and the United States. The company develops lodges and villages, open camps, and mobile assets, including modular, skid-mounted accommodation, and central facilities that provide long-term and temporary work force accommodations. It also provides catering and food services, housekeeping, laundry, water and wastewater treatment, power generation, communications, and personnel logistics services, as well as sewage hauling services. The company operates 19 lodges and villages with approximately 23,000 rooms in Canada and Australia; 9 smaller open camp properties; and a fleet of mobile accommodation assets. It serves independent oil and natural gas companies, mining companies, and oilfield and mining service companies. The company is headquartered in Houston, Texas.

FINANCIAL RATIOS  of  Civeo Corporation (CVEO)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate -100%
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 NaN
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. 0%
Return On Total Capital 0%
Ret/ On T. Cap. - 3 Yr. Avg. 0%
Return On Equity 0%
Return On Equity - 3 Yr. Avg. 0%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

CVEO stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CVEO stock intrinsic value calculation we used $467 million for the last fiscal year's total revenue generated by Civeo Corporation. The default revenue input number comes from 0001 income statement of Civeo Corporation. 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 CVEO stock valuation model: a) initial revenue growth rate of 13% 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 CVEO is calculated based on our internal credit rating of Civeo Corporation, 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 Civeo Corporation.
    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 CVEO stock the variable cost ratio is equal to 88%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $147 million in the base year in the intrinsic value calculation for CVEO 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 7.8% for Civeo Corporation.

Corporate tax rate of 27% is the nominal tax rate for Civeo Corporation. 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 CVEO 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 CVEO are equal to 158.6%.

Life of production assets of 6.4 years is the average useful life of capital assets used in Civeo Corporation 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 CVEO is equal to 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 - $535.424 million for Civeo Corporation - 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 166.116 million for Civeo Corporation 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 Civeo Corporation at the current share price and the inputted number of shares is $0.4 billion.

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