Intrinsic value of Delphi Technologies PLC - DLPH

Previous Close

$18.79

  Intrinsic Value

$30.78

stock screener

  Rating & Target

str. buy

+64%

Previous close

$18.79

 
Intrinsic value

$30.78

 
Up/down potential

+64%

 
Rating

str. buy

We calculate the intrinsic value of DLPH 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 1.7

 

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, %
  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
  4,955
  5,069
  5,199
  5,346
  5,508
  5,686
  5,879
  6,089
  6,315
  6,557
  6,816
  7,093
  7,387
  7,700
  8,033
  8,385
  8,757
  9,151
  9,568
  10,007
  10,471
  10,960
  11,476
  12,019
  12,591
  13,194
  13,828
  14,495
  15,197
  15,936
Variable operating expenses, $m
  4,499
  4,602
  4,721
  4,853
  5,000
  5,161
  5,337
  5,527
  5,731
  5,951
  6,178
  6,429
  6,696
  6,980
  7,281
  7,600
  7,938
  8,295
  8,672
  9,071
  9,491
  9,935
  10,402
  10,895
  11,413
  11,959
  12,534
  13,139
  13,775
  14,445
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
  4,499
  4,602
  4,721
  4,853
  5,000
  5,161
  5,337
  5,527
  5,731
  5,951
  6,178
  6,429
  6,696
  6,980
  7,281
  7,600
  7,938
  8,295
  8,672
  9,071
  9,491
  9,935
  10,402
  10,895
  11,413
  11,959
  12,534
  13,139
  13,775
  14,445
Operating income, $m
  456
  467
  479
  493
  508
  524
  542
  562
  583
  606
  638
  664
  691
  720
  752
  784
  819
  856
  895
  936
  980
  1,025
  1,074
  1,125
  1,178
  1,234
  1,294
  1,356
  1,422
  1,491
EBITDA, $m
  659
  674
  692
  711
  733
  756
  782
  810
  840
  872
  907
  944
  983
  1,024
  1,069
  1,115
  1,165
  1,217
  1,273
  1,331
  1,393
  1,458
  1,527
  1,599
  1,675
  1,755
  1,839
  1,928
  2,022
  2,120
Interest expense (income), $m
  145
  83
  81
  86
  91
  96
  103
  110
  117
  125
  134
  144
  154
  164
  176
  188
  201
  215
  229
  245
  261
  278
  296
  315
  335
  356
  379
  402
  427
  453
  480
Earnings before tax, $m
  373
  386
  393
  402
  411
  422
  433
  445
  458
  472
  494
  510
  527
  545
  563
  583
  605
  627
  651
  676
  702
  730
  759
  789
  822
  856
  892
  930
  969
  1,011
Tax expense, $m
  101
  104
  106
  109
  111
  114
  117
  120
  124
  127
  133
  138
  142
  147
  152
  158
  163
  169
  176
  182
  189
  197
  205
  213
  222
  231
  241
  251
  262
  273
Net income, $m
  273
  281
  287
  293
  300
  308
  316
  325
  334
  344
  361
  372
  385
  398
  411
  426
  441
  458
  475
  493
  512
  533
  554
  576
  600
  625
  651
  679
  708
  738

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
  3,970
  4,062
  4,166
  4,283
  4,413
  4,556
  4,711
  4,879
  5,060
  5,254
  5,462
  5,683
  5,919
  6,170
  6,436
  6,718
  7,017
  7,333
  7,666
  8,019
  8,390
  8,782
  9,195
  9,631
  10,089
  10,572
  11,080
  11,615
  12,177
  12,769
Adjusted assets (=assets-cash), $m
  3,970
  4,062
  4,166
  4,283
  4,413
  4,556
  4,711
  4,879
  5,060
  5,254
  5,462
  5,683
  5,919
  6,170
  6,436
  6,718
  7,017
  7,333
  7,666
  8,019
  8,390
  8,782
  9,195
  9,631
  10,089
  10,572
  11,080
  11,615
  12,177
  12,769
Revenue / Adjusted assets
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
  1.248
Average production assets, $m
  1,447
  1,480
  1,518
  1,561
  1,608
  1,660
  1,717
  1,778
  1,844
  1,915
  1,990
  2,071
  2,157
  2,249
  2,346
  2,448
  2,557
  2,672
  2,794
  2,922
  3,058
  3,200
  3,351
  3,510
  3,677
  3,853
  4,038
  4,233
  4,438
  4,653
Working capital, $m
  243
  248
  255
  262
  270
  279
  288
  298
  309
  321
  334
  348
  362
  377
  394
  411
  429
  448
  469
  490
  513
  537
  562
  589
  617
  646
  678
  710
  745
  781
Total debt, $m
  1,503
  1,586
  1,680
  1,785
  1,902
  2,030
  2,170
  2,321
  2,484
  2,659
  2,846
  3,045
  3,257
  3,483
  3,723
  3,977
  4,245
  4,529
  4,830
  5,147
  5,481
  5,834
  6,206
  6,598
  7,010
  7,445
  7,902
  8,383
  8,890
  9,422
Total liabilities, $m
  3,573
  3,656
  3,750
  3,855
  3,972
  4,100
  4,240
  4,391
  4,554
  4,729
  4,916
  5,115
  5,327
  5,553
  5,793
  6,047
  6,315
  6,599
  6,900
  7,217
  7,551
  7,904
  8,276
  8,668
  9,080
  9,515
  9,972
  10,453
  10,960
  11,492
Total equity, $m
  397
  406
  417
  428
  441
  456
  471
  488
  506
  525
  546
  568
  592
  617
  644
  672
  702
  733
  767
  802
  839
  878
  920
  963
  1,009
  1,057
  1,108
  1,161
  1,218
  1,277
Total liabilities and equity, $m
  3,970
  4,062
  4,167
  4,283
  4,413
  4,556
  4,711
  4,879
  5,060
  5,254
  5,462
  5,683
  5,919
  6,170
  6,437
  6,719
  7,017
  7,332
  7,667
  8,019
  8,390
  8,782
  9,196
  9,631
  10,089
  10,572
  11,080
  11,614
  12,178
  12,769
Debt-to-equity ratio
  3.790
  3.900
  4.030
  4.170
  4.310
  4.460
  4.610
  4.760
  4.910
  5.060
  5.210
  5.360
  5.500
  5.650
  5.780
  5.920
  6.050
  6.180
  6.300
  6.420
  6.530
  6.640
  6.750
  6.850
  6.950
  7.040
  7.130
  7.220
  7.300
  7.380
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
  273
  281
  287
  293
  300
  308
  316
  325
  334
  344
  361
  372
  385
  398
  411
  426
  441
  458
  475
  493
  512
  533
  554
  576
  600
  625
  651
  679
  708
  738
Depreciation, amort., depletion, $m
  203
  208
  213
  219
  225
  232
  240
  248
  257
  266
  269
  280
  292
  304
  317
  331
  346
  361
  378
  395
  413
  432
  453
  474
  497
  521
  546
  572
  600
  629
Funds from operations, $m
  476
  489
  500
  512
  525
  540
  556
  573
  591
  611
  630
  652
  676
  701
  728
  757
  787
  819
  852
  888
  925
  965
  1,007
  1,051
  1,097
  1,145
  1,197
  1,251
  1,307
  1,367
Change in working capital, $m
  5
  6
  6
  7
  8
  9
  9
  10
  11
  12
  13
  14
  14
  15
  16
  17
  18
  19
  20
  22
  23
  24
  25
  27
  28
  30
  31
  33
  34
  36
Cash from operations, $m
  471
  483
  493
  505
  517
  531
  546
  562
  580
  599
  617
  639
  662
  686
  712
  740
  769
  799
  832
  866
  903
  941
  981
  1,024
  1,069
  1,116
  1,166
  1,218
  1,273
  1,331
Maintenance CAPEX, $m
  -192
  -196
  -200
  -205
  -211
  -217
  -224
  -232
  -240
  -249
  -259
  -269
  -280
  -292
  -304
  -317
  -331
  -346
  -361
  -378
  -395
  -413
  -432
  -453
  -474
  -497
  -521
  -546
  -572
  -600
New CAPEX, $m
  -27
  -33
  -38
  -43
  -47
  -52
  -57
  -61
  -66
  -71
  -76
  -81
  -86
  -91
  -97
  -103
  -109
  -115
  -122
  -128
  -135
  -143
  -151
  -159
  -167
  -176
  -185
  -195
  -205
  -216
Cash from investing activities, $m
  -219
  -229
  -238
  -248
  -258
  -269
  -281
  -293
  -306
  -320
  -335
  -350
  -366
  -383
  -401
  -420
  -440
  -461
  -483
  -506
  -530
  -556
  -583
  -612
  -641
  -673
  -706
  -741
  -777
  -816
Free cash flow, $m
  252
  255
  255
  257
  259
  262
  265
  269
  274
  279
  283
  289
  296
  303
  311
  320
  329
  339
  349
  361
  372
  385
  398
  412
  427
  443
  460
  477
  496
  515
Issuance/(repayment) of debt, $m
  -28
  82
  94
  105
  117
  128
  140
  151
  163
  175
  187
  199
  212
  226
  240
  254
  269
  284
  300
  317
  335
  353
  372
  392
  413
  434
  457
  481
  506
  532
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  
  -28
  82
  94
  105
  117
  128
  140
  151
  163
  175
  187
  199
  212
  226
  240
  254
  269
  284
  300
  317
  335
  353
  372
  392
  413
  434
  457
  481
  506
  532
Total cash flow (excl. dividends), $m
  225
  337
  349
  362
  376
  390
  405
  420
  437
  454
  470
  488
  508
  529
  551
  574
  598
  623
  650
  678
  707
  738
  770
  804
  840
  878
  917
  959
  1,002
  1,048
Retained Cash Flow (-), $m
  -105
  -9
  -10
  -12
  -13
  -14
  -16
  -17
  -18
  -19
  -21
  -22
  -24
  -25
  -27
  -28
  -30
  -32
  -33
  -35
  -37
  -39
  -41
  -44
  -46
  -48
  -51
  -53
  -56
  -59
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
  120
  328
  339
  351
  363
  376
  389
  404
  419
  434
  449
  466
  485
  504
  524
  545
  568
  591
  616
  642
  670
  699
  729
  761
  794
  829
  866
  905
  946
  989
Discount rate, %
  7.60
  7.98
  8.38
  8.80
  9.24
  9.70
  10.18
  10.69
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.05
  15.80
  16.59
  17.42
  18.29
  19.20
  20.17
  21.17
  22.23
  23.34
  24.51
  25.74
  27.02
  28.37
  29.79
  31.28
PV of cash for distribution, $m
  111
  281
  266
  250
  233
  216
  197
  179
  161
  142
  124
  108
  92
  77
  64
  52
  42
  33
  25
  19
  14
  10
  7
  5
  3
  2
  1
  1
  0
  0
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

Aptiv PLC, formerly Delphi Automotive PLC, is a global technology company serving the automotive sector. The Company designs and manufactures vehicle components, and provides electrical and electronic and active safety technology solutions to the global automotive and commercial vehicle markets. The Company's segments include Electrical/Electronic Architecture, and Electronics & Safety. The Electrical/Electronic Architecture segment provides complete design of the vehicle's electrical architecture, including connectors, wiring assemblies and harnesses, electrical centers and hybrid high voltage and safety distribution systems. The Electronics and Safety segment offers a range of electronic and safety equipment and software in the areas of controls, security, infotainment, communications and safety systems.

FINANCIAL RATIOS  of  Delphi Technologies PLC (DLPH)

Valuation Ratios
P/E Ratio 4
Price to Sales 0.3
Price to Book 2.1
Price to Tangible Book
Price to Cash Flow 2.6
Price to Free Cash Flow 4.6
Growth Rates
Sales Growth Rate 9.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 17.6%
Cap. Spend. - 3 Yr. Gr. Rate 6.5%
Financial Strength
Quick Ratio 70
Current Ratio 0
LT Debt to Equity 164.9%
Total Debt to Equity 165.4%
Interest Coverage 11
Management Effectiveness
Return On Assets 11.4%
Ret/ On Assets - 3 Yr. Avg. 12.7%
Return On Total Capital 19.9%
Ret/ On T. Cap. - 3 Yr. Avg. 24%
Return On Equity 54.1%
Return On Equity - 3 Yr. Avg. 54.9%
Asset Turnover 1.4
Profitability Ratios
Gross Margin 21.3%
Gross Margin - 3 Yr. Avg. 20.2%
EBITDA Margin 13.6%
EBITDA Margin - 3 Yr. Avg. 14.2%
Operating Margin 11.2%
Oper. Margin - 3 Yr. Avg. 11%
Pre-Tax Margin 8.6%
Pre-Tax Margin - 3 Yr. Avg. 9.6%
Net Profit Margin 7.5%
Net Profit Margin - 3 Yr. Avg. 8.6%
Effective Tax Rate 17%
Eff/ Tax Rate - 3 Yr. Avg. 16.7%
Payout Ratio 25.2%

DLPH stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the DLPH stock intrinsic value calculation we used $4858 million for the last fiscal year's total revenue generated by Delphi Technologies PLC. The default revenue input number comes from 0001 income statement of Delphi Technologies PLC. 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 DLPH 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 7.6%, whose default value for DLPH is calculated based on our internal credit rating of Delphi Technologies PLC, 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 Delphi Technologies PLC.
    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 DLPH stock the variable cost ratio is equal to 90.8%.

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 DLPH 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 Delphi Technologies PLC.

Corporate tax rate of 27% is the nominal tax rate for Delphi Technologies PLC. 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 DLPH 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 DLPH are equal to 29.2%.

Life of production assets of 7.4 years is the average useful life of capital assets used in Delphi Technologies PLC 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 DLPH is equal to 4.9%. 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 - $292 million for Delphi Technologies PLC - 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 88.328 million for Delphi Technologies PLC 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 Delphi Technologies PLC at the current share price and the inputted number of shares is $1.7 billion.

RELATED COMPANIES Price Int.Val. Rating
VC Visteon Corpor 68.48 103.20  buy
THRM Gentherm Inc 36.66 25.79  sell
LEA Lear Corporati 132.12 292.51  str.buy
ALV Autoliv, Inc. 73.93 102.46  buy

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

Copyright © X-FIN.com 2005-2019. All rigths reserved.