Intrinsic value of Diebold Nixdorf Incorporated - DBD

Previous Close

$12.70

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$12.70

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of DBD 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 1.0

 

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, %
  3.20
  3.38
  3.54
  3.69
  3.82
  3.94
  4.04
  4.14
  4.23
  4.30
  4.37
  4.44
  4.49
  4.54
  4.59
  4.63
  4.67
  4.70
  4.73
  4.76
  4.78
  4.80
  4.82
  4.84
  4.86
  4.87
  4.88
  4.90
  4.91
  4.92
Revenue, $m
  4,726
  4,885
  5,058
  5,245
  5,445
  5,660
  5,888
  6,132
  6,391
  6,666
  6,958
  7,266
  7,593
  7,937
  8,302
  8,686
  9,091
  9,519
  9,969
  10,443
  10,942
  11,468
  12,021
  12,603
  13,215
  13,858
  14,535
  15,247
  15,995
  16,781
Variable operating expenses, $m
  4,815
  4,973
  5,144
  5,329
  5,527
  5,738
  5,965
  6,205
  6,462
  6,733
  6,876
  7,181
  7,504
  7,845
  8,204
  8,584
  8,985
  9,407
  9,852
  10,321
  10,814
  11,334
  11,880
  12,455
  13,060
  13,696
  14,365
  15,068
  15,807
  16,584
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
  4,815
  4,973
  5,144
  5,329
  5,527
  5,738
  5,965
  6,205
  6,462
  6,733
  6,876
  7,181
  7,504
  7,845
  8,204
  8,584
  8,985
  9,407
  9,852
  10,321
  10,814
  11,334
  11,880
  12,455
  13,060
  13,696
  14,365
  15,068
  15,807
  16,584
Operating income, $m
  -90
  -88
  -86
  -84
  -81
  -79
  -76
  -73
  -70
  -67
  81
  85
  89
  93
  97
  102
  106
  111
  117
  122
  128
  134
  141
  148
  155
  162
  170
  179
  187
  197
EBITDA, $m
  210
  218
  225
  234
  242
  252
  262
  273
  285
  297
  310
  324
  338
  353
  370
  387
  405
  424
  444
  465
  487
  511
  535
  561
  588
  617
  647
  679
  712
  747
Interest expense (income), $m
  85
  170
  133
  143
  154
  166
  179
  193
  208
  223
  240
  258
  276
  296
  317
  340
  363
  388
  414
  441
  470
  501
  533
  567
  603
  640
  679
  721
  765
  810
  859
Earnings before tax, $m
  -260
  -221
  -229
  -238
  -248
  -258
  -269
  -281
  -294
  -307
  -176
  -191
  -207
  -224
  -242
  -261
  -281
  -302
  -325
  -348
  -373
  -399
  -426
  -455
  -485
  -517
  -551
  -586
  -623
  -662
Tax expense, $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
Net income, $m
  -260
  -221
  -229
  -238
  -248
  -258
  -269
  -281
  -294
  -307
  -176
  -191
  -207
  -224
  -242
  -261
  -281
  -302
  -325
  -348
  -373
  -399
  -426
  -455
  -485
  -517
  -551
  -586
  -623
  -662

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
  4,450
  4,600
  4,763
  4,939
  5,127
  5,329
  5,545
  5,774
  6,018
  6,277
  6,551
  6,842
  7,149
  7,474
  7,817
  8,179
  8,561
  8,963
  9,387
  9,833
  10,303
  10,798
  11,319
  11,867
  12,443
  13,049
  13,687
  14,357
  15,061
  15,801
Adjusted assets (=assets-cash), $m
  4,450
  4,600
  4,763
  4,939
  5,127
  5,329
  5,545
  5,774
  6,018
  6,277
  6,551
  6,842
  7,149
  7,474
  7,817
  8,179
  8,561
  8,963
  9,387
  9,833
  10,303
  10,798
  11,319
  11,867
  12,443
  13,049
  13,687
  14,357
  15,061
  15,801
Revenue / Adjusted assets
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
  1.062
Average production assets, $m
  1,210
  1,251
  1,295
  1,343
  1,394
  1,449
  1,507
  1,570
  1,636
  1,707
  1,781
  1,860
  1,944
  2,032
  2,125
  2,224
  2,327
  2,437
  2,552
  2,673
  2,801
  2,936
  3,077
  3,226
  3,383
  3,548
  3,721
  3,903
  4,095
  4,296
Working capital, $m
  198
  205
  212
  220
  229
  238
  247
  258
  268
  280
  292
  305
  319
  333
  349
  365
  382
  400
  419
  439
  460
  482
  505
  529
  555
  582
  610
  640
  672
  705
Total debt, $m
  1,746
  1,881
  2,028
  2,186
  2,356
  2,537
  2,731
  2,938
  3,157
  3,390
  3,637
  3,899
  4,176
  4,468
  4,776
  5,102
  5,446
  5,808
  6,189
  6,591
  7,014
  7,460
  7,928
  8,422
  8,940
  9,486
  10,059
  10,662
  11,296
  11,962
Total liabilities, $m
  4,005
  4,140
  4,287
  4,445
  4,615
  4,796
  4,990
  5,197
  5,416
  5,649
  5,896
  6,158
  6,434
  6,727
  7,035
  7,361
  7,704
  8,067
  8,448
  8,850
  9,273
  9,718
  10,187
  10,680
  11,199
  11,744
  12,318
  12,921
  13,555
  14,221
Total equity, $m
  445
  460
  476
  494
  513
  533
  554
  577
  602
  628
  655
  684
  715
  747
  782
  818
  856
  896
  939
  983
  1,030
  1,080
  1,132
  1,187
  1,244
  1,305
  1,369
  1,436
  1,506
  1,580
Total liabilities and equity, $m
  4,450
  4,600
  4,763
  4,939
  5,128
  5,329
  5,544
  5,774
  6,018
  6,277
  6,551
  6,842
  7,149
  7,474
  7,817
  8,179
  8,560
  8,963
  9,387
  9,833
  10,303
  10,798
  11,319
  11,867
  12,443
  13,049
  13,687
  14,357
  15,061
  15,801
Debt-to-equity ratio
  3.920
  4.090
  4.260
  4.430
  4.590
  4.760
  4.930
  5.090
  5.250
  5.400
  5.550
  5.700
  5.840
  5.980
  6.110
  6.240
  6.360
  6.480
  6.590
  6.700
  6.810
  6.910
  7.000
  7.100
  7.180
  7.270
  7.350
  7.430
  7.500
  7.570
Adjusted equity ratio
  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
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -260
  -221
  -229
  -238
  -248
  -258
  -269
  -281
  -294
  -307
  -176
  -191
  -207
  -224
  -242
  -261
  -281
  -302
  -325
  -348
  -373
  -399
  -426
  -455
  -485
  -517
  -551
  -586
  -623
  -662
Depreciation, amort., depletion, $m
  300
  306
  311
  317
  324
  331
  338
  346
  355
  364
  228
  238
  249
  261
  272
  285
  298
  312
  327
  343
  359
  376
  395
  414
  434
  455
  477
  500
  525
  551
Funds from operations, $m
  40
  85
  82
  79
  76
  73
  69
  65
  61
  57
  52
  47
  42
  36
  30
  24
  17
  10
  3
  -5
  -14
  -22
  -32
  -41
  -52
  -62
  -74
  -86
  -98
  -111
Change in working capital, $m
  6
  7
  7
  8
  8
  9
  10
  10
  11
  12
  12
  13
  14
  14
  15
  16
  17
  18
  19
  20
  21
  22
  23
  24
  26
  27
  28
  30
  31
  33
Cash from operations, $m
  34
  78
  75
  72
  68
  64
  60
  55
  50
  45
  40
  34
  28
  22
  15
  8
  0
  -8
  -16
  -25
  -35
  -44
  -55
  -66
  -77
  -89
  -102
  -115
  -129
  -144
Maintenance CAPEX, $m
  -150
  -155
  -160
  -166
  -172
  -179
  -186
  -193
  -201
  -210
  -219
  -228
  -238
  -249
  -261
  -272
  -285
  -298
  -312
  -327
  -343
  -359
  -376
  -395
  -414
  -434
  -455
  -477
  -500
  -525
New CAPEX, $m
  -40
  -41
  -44
  -48
  -51
  -55
  -59
  -62
  -66
  -70
  -75
  -79
  -84
  -88
  -93
  -98
  -104
  -109
  -115
  -121
  -128
  -135
  -142
  -149
  -157
  -165
  -173
  -182
  -191
  -201
Cash from investing activities, $m
  -190
  -196
  -204
  -214
  -223
  -234
  -245
  -255
  -267
  -280
  -294
  -307
  -322
  -337
  -354
  -370
  -389
  -407
  -427
  -448
  -471
  -494
  -518
  -544
  -571
  -599
  -628
  -659
  -691
  -726
Free cash flow, $m
  -156
  -118
  -130
  -142
  -155
  -170
  -185
  -200
  -217
  -235
  -253
  -273
  -294
  -316
  -339
  -363
  -389
  -416
  -444
  -474
  -505
  -538
  -573
  -609
  -648
  -688
  -730
  -775
  -821
  -870
Issuance/(repayment) of debt, $m
  -494
  135
  147
  158
  170
  182
  194
  207
  220
  233
  247
  262
  277
  292
  309
  326
  343
  362
  382
  402
  423
  445
  469
  493
  519
  545
  574
  603
  634
  666
Issuance/(repurchase) of shares, $m
  891
  236
  245
  255
  266
  278
  291
  304
  318
  333
  204
  220
  238
  257
  277
  297
  319
  343
  367
  393
  420
  448
  478
  510
  543
  578
  614
  653
  693
  736
Cash from financing (excl. dividends), $m  
  397
  371
  392
  413
  436
  460
  485
  511
  538
  566
  451
  482
  515
  549
  586
  623
  662
  705
  749
  795
  843
  893
  947
  1,003
  1,062
  1,123
  1,188
  1,256
  1,327
  1,402
Total cash flow (excl. dividends), $m
  242
  253
  262
  271
  281
  290
  300
  310
  320
  331
  197
  209
  221
  233
  246
  260
  274
  289
  305
  321
  338
  356
  374
  394
  414
  435
  458
  481
  506
  532
Retained Cash Flow (-), $m
  -891
  -236
  -245
  -255
  -266
  -278
  -291
  -304
  -318
  -333
  -204
  -220
  -238
  -257
  -277
  -297
  -319
  -343
  -367
  -393
  -420
  -448
  -478
  -510
  -543
  -578
  -614
  -653
  -693
  -736
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
  -649
  18
  17
  16
  14
  12
  9
  6
  2
  -2
  -6
  -12
  -17
  -24
  -30
  -38
  -45
  -54
  -63
  -72
  -82
  -93
  -104
  -116
  -129
  -142
  -157
  -172
  -187
  -204
Discount rate, %
  13.70
  14.39
  15.10
  15.86
  16.65
  17.49
  18.36
  19.28
  20.24
  21.25
  22.32
  23.43
  24.60
  25.83
  27.13
  28.48
  29.91
  31.40
  32.97
  34.62
  36.35
  38.17
  40.08
  42.08
  44.18
  46.39
  48.71
  51.15
  53.71
  56.39
PV of cash for distribution, $m
  -571
  13
  11
  9
  7
  5
  3
  1
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  32.7
  21.3
  13.9
  9.0
  5.8
  3.8
  2.4
  1.6
  1.0
  0.8
  0.6
  0.4
  0.3
  0.2
  0.2
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Diebold Nixdorf, Incorporated provides connected commerce services, software and technology. The Company's geographic segments include North America (NA), Asia Pacific (AP), Europe, Middle East and Africa (EMEA), and Latin America (LA). These segments sell and service financial self-service (FSS), retail solutions and security systems. The Company is engaged in providing connected commerce solutions to financial institutions. These solutions are supported by a field service organization. The Company provides security solutions, which combine a services portfolio and products to help address its customers' needs. The Company provides services for a portfolio of physical security offerings, in addition to serving as a national locksmith. The Company provides voting machines for official elections and the terminals for the governmental lottery and correspondent bank.

FINANCIAL RATIOS  of  Diebold Nixdorf Incorporated (DBD)

Valuation Ratios
P/E Ratio -28.9
Price to Sales 0.3
Price to Book 1.6
Price to Tangible Book
Price to Cash Flow 35.3
Price to Free Cash Flow -73.4
Growth Rates
Sales Growth Rate 37.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -23.1%
Cap. Spend. - 3 Yr. Gr. Rate 3.3%
Financial Strength
Quick Ratio 7
Current Ratio 0.1
LT Debt to Equity 286.1%
Total Debt to Equity 304.2%
Interest Coverage -2
Management Effectiveness
Return On Assets 0.7%
Ret/ On Assets - 3 Yr. Avg. 3.9%
Return On Total Capital -1.9%
Ret/ On T. Cap. - 3 Yr. Avg. 5.2%
Return On Equity -6.6%
Return On Equity - 3 Yr. Avg. 9.8%
Asset Turnover 0.9
Profitability Ratios
Gross Margin 22.5%
Gross Margin - 3 Yr. Avg. 25.4%
EBITDA Margin -0.5%
EBITDA Margin - 3 Yr. Avg. 4.9%
Operating Margin -4.8%
Oper. Margin - 3 Yr. Avg. 1.2%
Pre-Tax Margin -7.2%
Pre-Tax Margin - 3 Yr. Avg. 0.1%
Net Profit Margin -1%
Net Profit Margin - 3 Yr. Avg. 2.1%
Effective Tax Rate 28.2%
Eff/ Tax Rate - 3 Yr. Avg. 9.6%
Payout Ratio -197%

DBD stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the DBD stock intrinsic value calculation we used $4579 million for the last fiscal year's total revenue generated by Diebold Nixdorf Incorporated. The default revenue input number comes from 0001 income statement of Diebold Nixdorf 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 DBD stock valuation model: a) initial revenue growth rate of 3.2% 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 13.7%, whose default value for DBD is calculated based on our internal credit rating of Diebold Nixdorf 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 Diebold Nixdorf 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 DBD stock the variable cost ratio is equal to 102%.

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 DBD 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 7.6% for Diebold Nixdorf Incorporated.

Corporate tax rate of 27% is the nominal tax rate for Diebold Nixdorf 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 DBD 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 DBD are equal to 25.6%.

Life of production assets of 7.8 years is the average useful life of capital assets used in Diebold Nixdorf 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 DBD is equal to 4.2%. 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 - $-186.4 million for Diebold Nixdorf 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 76.563 million for Diebold Nixdorf 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 Diebold Nixdorf Incorporated at the current share price and the inputted number of shares is $1.0 billion.

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