Intrinsic value of CyberOptics - CYBE

Previous Close

$19.10

  Intrinsic Value

$1.79

stock screener

  Rating & Target

str. sell

-91%

Previous close

$19.10

 
Intrinsic value

$1.79

 
Up/down potential

-91%

 
Rating

str. sell

We calculate the intrinsic value of CYBE 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, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  54
  56
  57
  59
  60
  62
  65
  67
  69
  72
  75
  78
  81
  85
  88
  92
  96
  100
  105
  110
  115
  120
  126
  132
  138
  145
  152
  159
  167
  175
Variable operating expenses, $m
  32
  33
  33
  34
  35
  36
  38
  39
  41
  42
  44
  45
  47
  49
  51
  54
  56
  58
  61
  64
  67
  70
  73
  77
  80
  84
  88
  93
  97
  102
Fixed operating expenses, $m
  21
  22
  22
  23
  23
  24
  24
  25
  26
  26
  27
  27
  28
  28
  29
  30
  30
  31
  32
  32
  33
  34
  35
  35
  36
  37
  38
  39
  39
  40
Total operating expenses, $m
  53
  55
  55
  57
  58
  60
  62
  64
  67
  68
  71
  72
  75
  77
  80
  84
  86
  89
  93
  96
  100
  104
  108
  112
  116
  121
  126
  132
  136
  142
Operating income, $m
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  5
  5
  6
  7
  8
  9
  10
  11
  12
  14
  15
  16
  18
  20
  22
  24
  26
  28
  30
  33
EBITDA, $m
  2
  2
  2
  2
  3
  3
  3
  4
  4
  5
  6
  6
  7
  8
  9
  10
  11
  12
  13
  15
  16
  18
  20
  21
  23
  25
  28
  30
  32
  35
Interest expense (income), $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
  1
  1
  1
  1
  1
  1
  1
Earnings before tax, $m
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  4
  5
  6
  7
  8
  8
  10
  11
  12
  13
  14
  16
  18
  19
  21
  23
  25
  27
  30
  32
Tax expense, $m
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  3
  3
  3
  4
  4
  4
  5
  5
  6
  6
  7
  7
  8
  9
Net income, $m
  1
  1
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  4
  5
  6
  6
  7
  8
  9
  10
  11
  12
  13
  14
  15
  17
  18
  20
  22
  23

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
  54
  55
  57
  59
  60
  62
  64
  67
  69
  72
  75
  78
  81
  84
  88
  92
  96
  100
  105
  110
  115
  120
  126
  132
  138
  144
  151
  159
  166
  174
Adjusted assets (=assets-cash), $m
  54
  55
  57
  59
  60
  62
  64
  67
  69
  72
  75
  78
  81
  84
  88
  92
  96
  100
  105
  110
  115
  120
  126
  132
  138
  144
  151
  159
  166
  174
Revenue / Adjusted assets
  1.000
  1.018
  1.000
  1.000
  1.000
  1.000
  1.016
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.012
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.000
  1.007
  1.007
  1.000
  1.006
  1.006
Average production assets, $m
  3
  3
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
  6
  7
  7
  7
  7
  8
  8
  9
  9
  9
  10
  10
  11
Working capital, $m
  20
  21
  21
  22
  23
  23
  24
  25
  26
  27
  28
  29
  30
  32
  33
  34
  36
  37
  39
  41
  43
  45
  47
  49
  52
  54
  57
  59
  62
  65
Total debt, $m
  0
  0
  1
  1
  1
  1
  2
  2
  2
  3
  3
  3
  4
  4
  5
  5
  6
  7
  7
  8
  8
  9
  10
  11
  12
  13
  14
  15
  16
  17
Total liabilities, $m
  7
  8
  8
  8
  8
  9
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  13
  14
  14
  15
  16
  16
  17
  18
  19
  20
  21
  22
  23
  24
Total equity, $m
  47
  48
  49
  50
  52
  54
  56
  58
  60
  62
  64
  67
  70
  73
  76
  79
  83
  86
  90
  95
  99
  104
  108
  114
  119
  125
  131
  137
  144
  151
Total liabilities and equity, $m
  54
  56
  57
  58
  60
  63
  65
  67
  69
  72
  74
  78
  81
  85
  88
  92
  96
  100
  104
  110
  115
  120
  125
  132
  138
  145
  152
  159
  167
  175
Debt-to-equity ratio
  0.000
  0.010
  0.010
  0.020
  0.020
  0.020
  0.030
  0.030
  0.040
  0.040
  0.050
  0.050
  0.060
  0.060
  0.060
  0.070
  0.070
  0.080
  0.080
  0.080
  0.090
  0.090
  0.090
  0.100
  0.100
  0.100
  0.100
  0.110
  0.110
  0.110
Adjusted equity ratio
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863
  0.863

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1
  1
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  4
  5
  6
  6
  7
  8
  9
  10
  11
  12
  13
  14
  15
  17
  18
  20
  22
  23
Depreciation, amort., depletion, $m
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
Funds from operations, $m
  2
  2
  2
  2
  2
  2
  3
  3
  3
  4
  4
  5
  5
  6
  7
  7
  8
  9
  10
  11
  12
  13
  14
  16
  17
  19
  20
  22
  24
  26
Change in working capital, $m
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
Cash from operations, $m
  1
  1
  1
  1
  1
  2
  2
  2
  2
  3
  3
  4
  4
  5
  5
  6
  7
  7
  8
  9
  10
  11
  12
  13
  15
  16
  18
  19
  21
  23
Maintenance CAPEX, $m
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
New CAPEX, $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
  -1
Cash from investing activities, $m
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -3
Free cash flow, $m
  1
  0
  0
  1
  1
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  5
  5
  6
  7
  8
  8
  9
  10
  12
  13
  14
  15
  17
  18
  20
Issuance/(repayment) of debt, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
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  
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
Total cash flow (excl. dividends), $m
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  3
  3
  4
  4
  5
  6
  7
  7
  8
  9
  10
  11
  12
  14
  15
  16
  18
  19
  21
Retained Cash Flow (-), $m
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
Prev. year cash balance distribution, $m
  7
  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
  7
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  2
  2
  3
  3
  4
  5
  6
  6
  7
  8
  9
  10
  11
  13
  14
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  6
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  99.7
  99.5
  99.3
  99.0
  98.8
  98.6
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5
  98.5

Cyberoptics Corporation is a developer and manufacturer of sensing technology solutions. The Company's products and services are used in the surface mount technology (SMT), semiconductor and three dimensional (3D) scanning solutions and services markets. Its products are sold into the electronics assembly, dynamic random access memory (DRAM) and flash memory, and semiconductor fabrication capital equipment markets. The Company develops, manufactures and sells non-contact sensors and systems for process control and inspection, and general purpose metrology. The Company's product offerings are sold to original equipment manufacturers (OEMs) and end user customers in the SMT circuit board assembly, semiconductor and general-purpose metrology markets. Its OEMs incorporate the Company's sensor offerings into capital equipment serving these industries. The Company also sells standalone inspection systems that are sold directly to circuit board assembly companies.

FINANCIAL RATIOS  of  CyberOptics (CYBE)

Valuation Ratios
P/E Ratio 11
Price to Sales 2
Price to Book 2.7
Price to Tangible Book
Price to Cash Flow 14.6
Price to Free Cash Flow 16.5
Growth Rates
Sales Growth Rate 61%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 0%
Cap. Spend. - 3 Yr. Gr. Rate 0%
Financial Strength
Quick Ratio NaN
Current Ratio 0.2
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 22.9%
Ret/ On Assets - 3 Yr. Avg. 5.4%
Return On Total Capital 28.2%
Ret/ On T. Cap. - 3 Yr. Avg. 6.7%
Return On Equity 28.2%
Return On Equity - 3 Yr. Avg. 6.7%
Asset Turnover 1.3
Profitability Ratios
Gross Margin 43.9%
Gross Margin - 3 Yr. Avg. 44.5%
EBITDA Margin 12.1%
EBITDA Margin - 3 Yr. Avg. 4.8%
Operating Margin 9.1%
Oper. Margin - 3 Yr. Avg. -0%
Pre-Tax Margin 9.1%
Pre-Tax Margin - 3 Yr. Avg. 0.7%
Net Profit Margin 18.2%
Net Profit Margin - 3 Yr. Avg. 3.7%
Effective Tax Rate -100%
Eff/ Tax Rate - 3 Yr. Avg. -33.3%
Payout Ratio 0%

CYBE stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the CYBE stock intrinsic value calculation we used $53.333 million for the last fiscal year's total revenue generated by CyberOptics. The default revenue input number comes from 0001 income statement of CyberOptics. 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 CYBE stock valuation model: a) initial revenue growth rate of 2% 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 4.3%, whose default value for CYBE is calculated based on our internal credit rating of CyberOptics, 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 CyberOptics.
    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 CYBE stock the variable cost ratio is equal to 58.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $21 million in the base year in the intrinsic value calculation for CYBE 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 CyberOptics.

Corporate tax rate of 27% is the nominal tax rate for CyberOptics. 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 CYBE 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 CYBE are equal to 6.2%.

Life of production assets of 1.8 years is the average useful life of capital assets used in CyberOptics 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 CYBE is equal to 37.3%. 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 - $52.282 million for CyberOptics - 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 7.042 million for CyberOptics 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 CyberOptics at the current share price and the inputted number of shares is $0.1 billion.

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COMPANY NEWS

▶ CyberOptics: 3Q Earnings Snapshot   [Oct-24-18 08:37AM  Associated Press]
▶ Who Really Owns CyberOptics Corporation (NASDAQ:CYBE)?   [Sep-24-18 02:35PM  Simply Wall St.]
▶ CyberOptics: 2Q Earnings Snapshot   [Jul-25-18 05:02PM  Associated Press]
▶ CyberOptics posts 4Q profit   [Feb-20-18 05:13PM  Associated Press]
▶ CyberOptics Q4 Earnings Preview   [10:09AM  Benzinga]
▶ CyberOptics reports 3Q loss   [Oct-24-17 06:01PM  Associated Press]
▶ New Strong Sell Stocks for October 18th   [Oct-18-17 10:44AM  Zacks]
▶ ETFs with exposure to CyberOptics Corp. : October 3, 2017   [Oct-03-17 11:08AM  Capital Cube]
▶ CyberOptics posts 2Q profit   [Jul-27-17 10:03PM  Associated Press]
▶ ETFs with exposure to CyberOptics Corp. : July 12, 2017   [Jul-12-17 02:25PM  Capital Cube]
▶ CyberOptics Corporation Added to the Russell 2000® Index   [Jul-03-17 09:00AM  Business Wire]
▶ ETFs with exposure to CyberOptics Corp. : May 29, 2017   [May-29-17 12:44PM  Capital Cube]
▶ ETFs with exposure to CyberOptics Corp. : May 18, 2017   [May-18-17 01:39PM  Capital Cube]
▶ ETFs with exposure to CyberOptics Corp. : April 26, 2017   [Apr-26-17 03:14PM  Capital Cube]
▶ CyberOptics reports 1Q loss   [Apr-25-17 06:38PM  Associated Press]
▶ New Strong Sell Stocks for April 21st   [Apr-21-17 10:43AM  Zacks]
▶ ETFs with exposure to CyberOptics Corp. : April 5, 2017   [Apr-05-17 04:36PM  Capital Cube]
▶ CyberOptics posts 4Q profit   [Feb-28-17 07:44PM  Associated Press]

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