Intrinsic value of Endo International plc - ENDP

Previous Close

$4.10

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$4.10

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of ENDP 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 0.9

 

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, %
  2.30
  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
  4.87
Revenue, $m
  3,015
  3,092
  3,179
  3,276
  3,381
  3,497
  3,621
  3,755
  3,900
  4,054
  4,218
  4,394
  4,580
  4,777
  4,987
  5,208
  5,443
  5,690
  5,952
  6,228
  6,518
  6,825
  7,148
  7,489
  7,847
  8,224
  8,621
  9,038
  9,477
  9,939
Variable operating expenses, $m
  3,834
  3,931
  4,040
  4,161
  4,294
  4,438
  4,595
  4,763
  4,944
  5,138
  5,294
  5,514
  5,748
  5,996
  6,259
  6,537
  6,831
  7,142
  7,470
  7,816
  8,181
  8,566
  8,971
  9,399
  9,848
  10,322
  10,820
  11,344
  11,895
  12,474
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
  3,834
  3,931
  4,040
  4,161
  4,294
  4,438
  4,595
  4,763
  4,944
  5,138
  5,294
  5,514
  5,748
  5,996
  6,259
  6,537
  6,831
  7,142
  7,470
  7,816
  8,181
  8,566
  8,971
  9,399
  9,848
  10,322
  10,820
  11,344
  11,895
  12,474
Operating income, $m
  -819
  -839
  -861
  -885
  -912
  -942
  -974
  -1,008
  -1,045
  -1,084
  -1,076
  -1,121
  -1,168
  -1,219
  -1,272
  -1,328
  -1,388
  -1,451
  -1,518
  -1,588
  -1,663
  -1,741
  -1,823
  -1,910
  -2,001
  -2,098
  -2,199
  -2,305
  -2,417
  -2,535
EBITDA, $m
  -378
  -388
  -399
  -411
  -424
  -438
  -454
  -471
  -489
  -508
  -529
  -551
  -574
  -599
  -625
  -653
  -683
  -714
  -746
  -781
  -817
  -856
  -896
  -939
  -984
  -1,031
  -1,081
  -1,133
  -1,189
  -1,246
Interest expense (income), $m
  0
  520
  438
  453
  470
  489
  509
  532
  556
  582
  610
  640
  672
  707
  743
  781
  822
  865
  911
  959
  1,010
  1,064
  1,121
  1,180
  1,243
  1,310
  1,379
  1,453
  1,530
  1,612
  1,697
Earnings before tax, $m
  -1,339
  -1,277
  -1,314
  -1,355
  -1,401
  -1,451
  -1,505
  -1,564
  -1,627
  -1,694
  -1,716
  -1,793
  -1,875
  -1,961
  -2,053
  -2,151
  -2,254
  -2,362
  -2,477
  -2,599
  -2,727
  -2,861
  -3,004
  -3,153
  -3,311
  -3,477
  -3,652
  -3,836
  -4,029
  -4,232
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
  -1,339
  -1,277
  -1,314
  -1,355
  -1,401
  -1,451
  -1,505
  -1,564
  -1,627
  -1,694
  -1,716
  -1,793
  -1,875
  -1,961
  -2,053
  -2,151
  -2,254
  -2,362
  -2,477
  -2,599
  -2,727
  -2,861
  -3,004
  -3,153
  -3,311
  -3,477
  -3,652
  -3,836
  -4,029
  -4,232

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
  10,360
  10,626
  10,925
  11,256
  11,620
  12,016
  12,444
  12,905
  13,401
  13,931
  14,496
  15,098
  15,738
  16,417
  17,136
  17,898
  18,703
  19,554
  20,452
  21,400
  22,400
  23,454
  24,564
  25,734
  26,965
  28,261
  29,625
  31,059
  32,569
  34,156
Adjusted assets (=assets-cash), $m
  10,360
  10,626
  10,925
  11,256
  11,620
  12,016
  12,444
  12,905
  13,401
  13,931
  14,496
  15,098
  15,738
  16,417
  17,136
  17,898
  18,703
  19,554
  20,452
  21,400
  22,400
  23,454
  24,564
  25,734
  26,965
  28,261
  29,625
  31,059
  32,569
  34,156
Revenue / Adjusted assets
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
Average production assets, $m
  4,613
  4,731
  4,864
  5,012
  5,174
  5,350
  5,540
  5,746
  5,966
  6,202
  6,454
  6,722
  7,007
  7,309
  7,629
  7,969
  8,327
  8,706
  9,106
  9,528
  9,973
  10,442
  10,937
  11,457
  12,006
  12,583
  13,190
  13,829
  14,500
  15,207
Working capital, $m
  -1,052
  -1,079
  -1,110
  -1,143
  -1,180
  -1,220
  -1,264
  -1,311
  -1,361
  -1,415
  -1,472
  -1,533
  -1,598
  -1,667
  -1,740
  -1,818
  -1,899
  -1,986
  -2,077
  -2,173
  -2,275
  -2,382
  -2,495
  -2,613
  -2,739
  -2,870
  -3,009
  -3,154
  -3,308
  -3,469
Total debt, $m
  6,952
  7,191
  7,460
  7,759
  8,086
  8,442
  8,827
  9,243
  9,688
  10,165
  10,674
  11,216
  11,792
  12,403
  13,050
  13,736
  14,460
  15,226
  16,035
  16,888
  17,788
  18,736
  19,736
  20,788
  21,896
  23,063
  24,290
  25,581
  26,939
  28,368
Total liabilities, $m
  9,324
  9,564
  9,833
  10,131
  10,458
  10,814
  11,200
  11,615
  12,061
  12,538
  13,046
  13,588
  14,164
  14,775
  15,422
  16,108
  16,833
  17,598
  18,407
  19,260
  20,160
  21,109
  22,108
  23,160
  24,268
  25,435
  26,662
  27,953
  29,312
  30,740
Total equity, $m
  1,036
  1,063
  1,093
  1,126
  1,162
  1,202
  1,244
  1,291
  1,340
  1,393
  1,450
  1,510
  1,574
  1,642
  1,714
  1,790
  1,870
  1,955
  2,045
  2,140
  2,240
  2,345
  2,456
  2,573
  2,696
  2,826
  2,962
  3,106
  3,257
  3,416
Total liabilities and equity, $m
  10,360
  10,627
  10,926
  11,257
  11,620
  12,016
  12,444
  12,906
  13,401
  13,931
  14,496
  15,098
  15,738
  16,417
  17,136
  17,898
  18,703
  19,553
  20,452
  21,400
  22,400
  23,454
  24,564
  25,733
  26,964
  28,261
  29,624
  31,059
  32,569
  34,156
Debt-to-equity ratio
  6.710
  6.770
  6.830
  6.890
  6.960
  7.030
  7.090
  7.160
  7.230
  7.300
  7.360
  7.430
  7.490
  7.550
  7.620
  7.670
  7.730
  7.790
  7.840
  7.890
  7.940
  7.990
  8.030
  8.080
  8.120
  8.160
  8.200
  8.240
  8.270
  8.310
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
  -1,339
  -1,277
  -1,314
  -1,355
  -1,401
  -1,451
  -1,505
  -1,564
  -1,627
  -1,694
  -1,716
  -1,793
  -1,875
  -1,961
  -2,053
  -2,151
  -2,254
  -2,362
  -2,477
  -2,599
  -2,727
  -2,861
  -3,004
  -3,153
  -3,311
  -3,477
  -3,652
  -3,836
  -4,029
  -4,232
Depreciation, amort., depletion, $m
  441
  451
  462
  475
  488
  503
  519
  537
  556
  576
  547
  570
  594
  619
  647
  675
  706
  738
  772
  807
  845
  885
  927
  971
  1,017
  1,066
  1,118
  1,172
  1,229
  1,289
Funds from operations, $m
  -898
  -826
  -852
  -881
  -913
  -948
  -986
  -1,027
  -1,071
  -1,119
  -1,169
  -1,223
  -1,281
  -1,342
  -1,407
  -1,475
  -1,548
  -1,625
  -1,706
  -1,791
  -1,881
  -1,977
  -2,077
  -2,182
  -2,294
  -2,411
  -2,534
  -2,664
  -2,800
  -2,944
Change in working capital, $m
  -24
  -27
  -30
  -34
  -37
  -40
  -44
  -47
  -50
  -54
  -57
  -61
  -65
  -69
  -73
  -77
  -82
  -86
  -91
  -96
  -102
  -107
  -113
  -119
  -125
  -132
  -139
  -146
  -153
  -161
Cash from operations, $m
  -875
  -799
  -821
  -847
  -876
  -908
  -942
  -980
  -1,021
  -1,065
  -1,112
  -1,162
  -1,216
  -1,273
  -1,334
  -1,398
  -1,466
  -1,538
  -1,614
  -1,695
  -1,780
  -1,870
  -1,964
  -2,064
  -2,169
  -2,279
  -2,396
  -2,518
  -2,647
  -2,782
Maintenance CAPEX, $m
  -382
  -391
  -401
  -412
  -425
  -438
  -453
  -470
  -487
  -506
  -526
  -547
  -570
  -594
  -619
  -647
  -675
  -706
  -738
  -772
  -807
  -845
  -885
  -927
  -971
  -1,017
  -1,066
  -1,118
  -1,172
  -1,229
New CAPEX, $m
  -104
  -119
  -133
  -147
  -162
  -176
  -191
  -205
  -221
  -236
  -252
  -268
  -285
  -302
  -320
  -339
  -359
  -379
  -400
  -422
  -445
  -469
  -494
  -521
  -548
  -577
  -607
  -639
  -672
  -707
Cash from investing activities, $m
  -486
  -510
  -534
  -559
  -587
  -614
  -644
  -675
  -708
  -742
  -778
  -815
  -855
  -896
  -939
  -986
  -1,034
  -1,085
  -1,138
  -1,194
  -1,252
  -1,314
  -1,379
  -1,448
  -1,519
  -1,594
  -1,673
  -1,757
  -1,844
  -1,936
Free cash flow, $m
  -1,361
  -1,308
  -1,355
  -1,407
  -1,462
  -1,522
  -1,587
  -1,655
  -1,728
  -1,806
  -1,889
  -1,977
  -2,070
  -2,169
  -2,273
  -2,384
  -2,500
  -2,623
  -2,752
  -2,889
  -3,032
  -3,184
  -3,343
  -3,511
  -3,688
  -3,874
  -4,069
  -4,275
  -4,491
  -4,718
Issuance/(repayment) of debt, $m
  -1,307
  240
  269
  298
  327
  356
  386
  415
  446
  477
  509
  542
  576
  611
  647
  685
  725
  766
  809
  853
  900
  948
  999
  1,052
  1,108
  1,166
  1,227
  1,291
  1,358
  1,428
Issuance/(repurchase) of shares, $m
  2,873
  1,303
  1,344
  1,389
  1,438
  1,491
  1,548
  1,610
  1,676
  1,747
  1,773
  1,853
  1,939
  2,029
  2,125
  2,227
  2,334
  2,447
  2,567
  2,693
  2,827
  2,967
  3,115
  3,270
  3,434
  3,607
  3,788
  3,979
  4,180
  4,391
Cash from financing (excl. dividends), $m  
  1,566
  1,543
  1,613
  1,687
  1,765
  1,847
  1,934
  2,025
  2,122
  2,224
  2,282
  2,395
  2,515
  2,640
  2,772
  2,912
  3,059
  3,213
  3,376
  3,546
  3,727
  3,915
  4,114
  4,322
  4,542
  4,773
  5,015
  5,270
  5,538
  5,819
Total cash flow (excl. dividends), $m
  206
  235
  257
  280
  302
  325
  347
  370
  394
  418
  392
  418
  444
  471
  499
  529
  559
  591
  624
  658
  694
  731
  771
  812
  855
  899
  947
  996
  1,047
  1,101
Retained Cash Flow (-), $m
  -2,873
  -1,303
  -1,344
  -1,389
  -1,438
  -1,491
  -1,548
  -1,610
  -1,676
  -1,747
  -1,773
  -1,853
  -1,939
  -2,029
  -2,125
  -2,227
  -2,334
  -2,447
  -2,567
  -2,693
  -2,827
  -2,967
  -3,115
  -3,270
  -3,434
  -3,607
  -3,788
  -3,979
  -4,180
  -4,391
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
  -2,667
  -1,069
  -1,086
  -1,109
  -1,135
  -1,166
  -1,201
  -1,240
  -1,283
  -1,330
  -1,381
  -1,436
  -1,495
  -1,558
  -1,626
  -1,698
  -1,775
  -1,857
  -1,944
  -2,035
  -2,133
  -2,235
  -2,344
  -2,459
  -2,580
  -2,707
  -2,842
  -2,983
  -3,133
  -3,290
Discount rate, %
  13.50
  14.18
  14.88
  15.63
  16.41
  17.23
  18.09
  19.00
  19.95
  20.94
  21.99
  23.09
  24.24
  25.46
  26.73
  28.07
  29.47
  30.94
  32.49
  34.11
  35.82
  37.61
  39.49
  41.47
  43.54
  45.72
  48.00
  50.40
  52.92
  55.57
PV of cash for distribution, $m
  -2,350
  -820
  -717
  -620
  -531
  -449
  -375
  -308
  -250
  -199
  -155
  -119
  -89
  -65
  -47
  -32
  -22
  -14
  -9
  -6
  -3
  -2
  -1
  -1
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  22.1
  9.8
  4.3
  1.9
  0.8
  0.4
  0.2
  0.1
  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
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Endo International plc develops, manufactures, and distributes pharmaceutical products and devices worldwide. Its U.S. Branded Pharmaceuticals segment offers chronic pain management products, such as BELBUCA, OPANA ER, and Percocet; Lidoderm for opioid analgesics; and Voltaren gel for osteoarthritis pain, as well as XIAFLEX for treating Peyronie’s and Dupuytren’s contracture diseases. This segment also provides Supprelin LA for central precocious puberty treatment; testosterone replacement therapies, such as Aveed and TESTOPEL, as well as Fortesta and Testim gels; Frova and Sumavel DosePro for migraine headaches; Valstar, a sterile solution for intravesical instillation of valrubicin; and Vantas for the palliative treatment of prostate cancer. The company’s U.S. Generic Pharmaceuticals segment provides tablets, capsules, powders, injectables, liquids, nasal sprays, ophthalmics, and transdermal patches for pain management, urology, central nervous system disorders, immunosuppression, oncology, women’s health, and cardiovascular disease markets. Its International Pharmaceuticals segment offers specialty pharmaceutical products in various therapeutic areas, including attention deficit hyperactivity disorder, pain, women’s health, and oncology; generic, branded generic, and over-the-counter products in the areas of dermatology and anti-infectives; injectables for the treatment of pain, anti-infectives, cardiovascular, and other therapeutics areas; and healthcare services, products, and solutions to hospitals, pharmacies, and practitioners, as well as for government healthcare programs. The company also provides Monarc subfascial hammock to treat female stress urinary incontinence; and Elevate transvaginal pelvic floor repair system for the treatment of pelvic organ prolapse. It sells its branded pharmaceuticals and generics directly, as well as through wholesale drug distributors. Endo International plc was founded in 1920 and is headquartered in Dublin, Ireland.

FINANCIAL RATIOS  of  Endo International plc (ENDP)

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%

ENDP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ENDP stock intrinsic value calculation we used $2947 million for the last fiscal year's total revenue generated by Endo International plc. The default revenue input number comes from 0001 income statement of Endo International 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 ENDP stock valuation model: a) initial revenue growth rate of 2.3% 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 13.5%, whose default value for ENDP is calculated based on our internal credit rating of Endo International 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 Endo International 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 ENDP stock the variable cost ratio is equal to 127.2%.

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 ENDP 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 6.3% for Endo International plc.

Corporate tax rate of 27% is the nominal tax rate for Endo International 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 ENDP 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 ENDP are equal to 153%.

Life of production assets of 11.8 years is the average useful life of capital assets used in Endo International 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 ENDP is equal to -34.9%. 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 - $-498.283 million for Endo International 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 223.934 million for Endo International 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 Endo International plc at the current share price and the inputted number of shares is $0.9 billion.

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