Intrinsic value of EQT - EQT

Previous Close

$47.36

  Intrinsic Value

$10.01

stock screener

  Rating & Target

str. sell

-79%

Previous close

$47.36

 
Intrinsic value

$10.01

 
Up/down potential

-79%

 
Rating

str. sell

We calculate the intrinsic value of EQT 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 12.5

 

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, %
  53.10
  48.29
  43.96
  40.06
  36.56
  33.40
  30.56
  28.01
  25.71
  23.63
  21.77
  20.09
  18.58
  17.23
  16.00
  14.90
  13.91
  13.02
  12.22
  11.50
  10.85
  10.26
  9.74
  9.26
  8.84
  8.45
  8.11
  7.80
  7.52
  7.27
Revenue, $m
  5,172
  7,669
  11,041
  15,464
  21,117
  28,171
  36,781
  47,082
  59,185
  73,173
  89,103
  107,008
  126,896
  148,755
  172,561
  198,279
  225,865
  255,277
  286,471
  319,408
  354,057
  390,394
  428,405
  468,089
  509,453
  552,517
  597,314
  643,887
  692,290
  742,589
Variable operating expenses, $m
  1,489
  2,076
  2,868
  3,908
  5,237
  6,895
  8,918
  11,339
  14,184
  17,471
  20,942
  25,150
  29,825
  34,962
  40,558
  46,602
  53,086
  59,998
  67,330
  75,071
  83,215
  91,755
  100,689
  110,016
  119,738
  129,860
  140,388
  151,335
  162,711
  174,533
Fixed operating expenses, $m
  1,441
  1,473
  1,505
  1,538
  1,572
  1,607
  1,642
  1,678
  1,715
  1,753
  1,791
  1,831
  1,871
  1,912
  1,954
  1,997
  2,041
  2,086
  2,132
  2,179
  2,227
  2,276
  2,326
  2,377
  2,429
  2,483
  2,537
  2,593
  2,650
  2,709
Total operating expenses, $m
  2,930
  3,549
  4,373
  5,446
  6,809
  8,502
  10,560
  13,017
  15,899
  19,224
  22,733
  26,981
  31,696
  36,874
  42,512
  48,599
  55,127
  62,084
  69,462
  77,250
  85,442
  94,031
  103,015
  112,393
  122,167
  132,343
  142,925
  153,928
  165,361
  177,242
Operating income, $m
  2,242
  4,120
  6,667
  10,018
  14,309
  19,670
  26,221
  34,064
  43,286
  53,948
  66,370
  80,027
  95,200
  111,881
  130,050
  149,680
  170,738
  193,192
  217,009
  242,158
  268,615
  296,363
  325,390
  355,696
  387,285
  420,175
  454,388
  489,959
  526,929
  565,347
EBITDA, $m
  4,129
  6,787
  10,385
  15,116
  21,170
  28,732
  37,969
  49,027
  62,023
  77,050
  94,168
  113,411
  134,789
  158,289
  183,885
  211,538
  241,204
  272,833
  306,381
  341,806
  379,073
  418,157
  459,044
  501,729
  546,224
  592,549
  640,738
  690,838
  742,908
  797,019
Interest expense (income), $m
  145
  403
  873
  1,523
  2,400
  3,550
  5,020
  6,854
  9,093
  11,772
  14,920
  18,557
  22,700
  27,356
  32,528
  38,213
  44,403
  51,091
  58,265
  65,914
  74,026
  82,591
  91,602
  101,051
  110,936
  121,256
  132,013
  143,212
  154,862
  166,973
  179,560
Earnings before tax, $m
  1,838
  3,247
  5,144
  7,618
  10,759
  14,650
  19,366
  24,971
  31,513
  39,029
  47,813
  57,327
  67,844
  79,353
  91,837
  105,276
  119,647
  134,927
  151,095
  168,132
  186,024
  204,761
  224,339
  244,759
  266,029
  288,162
  311,176
  335,098
  359,956
  385,787
Tax expense, $m
  496
  877
  1,389
  2,057
  2,905
  3,955
  5,229
  6,742
  8,509
  10,538
  12,909
  15,478
  18,318
  21,425
  24,796
  28,425
  32,305
  36,430
  40,796
  45,396
  50,226
  55,285
  60,571
  66,085
  71,828
  77,804
  84,018
  90,476
  97,188
  104,163
Net income, $m
  1,342
  2,370
  3,755
  5,561
  7,854
  10,694
  14,137
  18,229
  23,005
  28,491
  34,903
  41,849
  49,526
  57,927
  67,041
  76,852
  87,342
  98,497
  110,299
  122,736
  135,797
  149,475
  163,767
  178,674
  194,201
  210,358
  227,159
  244,621
  262,768
  281,625

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
  45,366
  67,273
  96,848
  135,649
  185,241
  247,116
  322,640
  412,999
  519,162
  641,866
  781,609
  938,668
  1,113,119
  1,304,868
  1,513,696
  1,739,288
  1,981,275
  2,239,272
  2,512,901
  2,801,824
  3,105,761
  3,424,507
  3,757,943
  4,106,044
  4,468,885
  4,846,644
  5,239,599
  5,648,131
  6,072,718
  6,513,936
Adjusted assets (=assets-cash), $m
  45,366
  67,273
  96,848
  135,649
  185,241
  247,116
  322,640
  412,999
  519,162
  641,866
  781,609
  938,668
  1,113,119
  1,304,868
  1,513,696
  1,739,288
  1,981,275
  2,239,272
  2,512,901
  2,801,824
  3,105,761
  3,424,507
  3,757,943
  4,106,044
  4,468,885
  4,846,644
  5,239,599
  5,648,131
  6,072,718
  6,513,936
Revenue / Adjusted assets
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
  0.114
Average production assets, $m
  30,172
  44,742
  64,411
  90,217
  123,199
  164,351
  214,580
  274,676
  345,282
  426,890
  519,830
  624,286
  740,308
  867,837
  1,006,723
  1,156,759
  1,317,699
  1,489,286
  1,671,270
  1,863,426
  2,065,567
  2,277,557
  2,499,317
  2,730,831
  2,972,148
  3,223,387
  3,484,732
  3,756,436
  4,038,819
  4,332,262
Working capital, $m
  -476
  -706
  -1,016
  -1,423
  -1,943
  -2,592
  -3,384
  -4,332
  -5,445
  -6,732
  -8,198
  -9,845
  -11,674
  -13,685
  -15,876
  -18,242
  -20,780
  -23,485
  -26,355
  -29,386
  -32,573
  -35,916
  -39,413
  -43,064
  -46,870
  -50,832
  -54,953
  -59,238
  -63,691
  -68,318
Total debt, $m
  16,174
  28,201
  44,437
  65,739
  92,965
  126,934
  168,397
  218,004
  276,288
  343,652
  420,371
  506,597
  602,370
  707,640
  822,287
  946,137
  1,078,988
  1,220,628
  1,370,850
  1,529,469
  1,696,330
  1,871,322
  2,054,378
  2,245,486
  2,444,686
  2,652,075
  2,867,808
  3,092,091
  3,325,190
  3,567,418
Total liabilities, $m
  24,906
  36,933
  53,169
  74,472
  101,697
  135,667
  177,129
  226,736
  285,020
  352,384
  429,104
  515,329
  611,102
  716,373
  831,019
  954,869
  1,087,720
  1,229,360
  1,379,582
  1,538,201
  1,705,063
  1,880,054
  2,063,111
  2,254,218
  2,453,418
  2,660,808
  2,876,540
  3,100,824
  3,333,922
  3,576,151
Total equity, $m
  20,460
  30,340
  43,678
  61,178
  83,544
  111,449
  145,511
  186,263
  234,142
  289,482
  352,506
  423,339
  502,016
  588,496
  682,677
  784,419
  893,555
  1,009,912
  1,133,318
  1,263,623
  1,400,698
  1,544,453
  1,694,832
  1,851,826
  2,015,467
  2,185,836
  2,363,059
  2,547,307
  2,738,796
  2,937,785
Total liabilities and equity, $m
  45,366
  67,273
  96,847
  135,650
  185,241
  247,116
  322,640
  412,999
  519,162
  641,866
  781,610
  938,668
  1,113,118
  1,304,869
  1,513,696
  1,739,288
  1,981,275
  2,239,272
  2,512,900
  2,801,824
  3,105,761
  3,424,507
  3,757,943
  4,106,044
  4,468,885
  4,846,644
  5,239,599
  5,648,131
  6,072,718
  6,513,936
Debt-to-equity ratio
  0.790
  0.930
  1.020
  1.070
  1.110
  1.140
  1.160
  1.170
  1.180
  1.190
  1.190
  1.200
  1.200
  1.200
  1.200
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
  1.210
Adjusted equity ratio
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451
  0.451

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,342
  2,370
  3,755
  5,561
  7,854
  10,694
  14,137
  18,229
  23,005
  28,491
  34,903
  41,849
  49,526
  57,927
  67,041
  76,852
  87,342
  98,497
  110,299
  122,736
  135,797
  149,475
  163,767
  178,674
  194,201
  210,358
  227,159
  244,621
  262,768
  281,625
Depreciation, amort., depletion, $m
  1,887
  2,666
  3,718
  5,098
  6,862
  9,062
  11,748
  14,962
  18,738
  23,102
  27,798
  33,384
  39,589
  46,408
  53,835
  61,859
  70,465
  79,641
  89,373
  99,648
  110,458
  121,795
  133,653
  146,034
  158,938
  172,374
  186,349
  200,879
  215,980
  231,672
Funds from operations, $m
  3,229
  5,036
  7,473
  10,659
  14,716
  19,757
  25,886
  33,191
  41,743
  51,593
  62,702
  75,233
  89,115
  104,336
  120,876
  138,710
  157,808
  178,138
  199,672
  222,385
  246,255
  271,270
  297,421
  324,708
  353,140
  382,732
  413,508
  445,500
  478,747
  513,296
Change in working capital, $m
  -165
  -230
  -310
  -407
  -520
  -649
  -792
  -948
  -1,113
  -1,287
  -1,466
  -1,647
  -1,830
  -2,011
  -2,190
  -2,366
  -2,538
  -2,706
  -2,870
  -3,030
  -3,188
  -3,343
  -3,497
  -3,651
  -3,805
  -3,962
  -4,121
  -4,285
  -4,453
  -4,627
Cash from operations, $m
  3,394
  5,266
  7,783
  11,066
  15,236
  20,406
  26,678
  34,139
  42,856
  52,880
  64,167
  76,880
  90,944
  106,347
  123,067
  141,076
  160,345
  180,844
  202,542
  225,415
  249,443
  274,613
  300,918
  328,359
  356,945
  386,694
  417,629
  449,785
  483,200
  517,924
Maintenance CAPEX, $m
  -1,054
  -1,613
  -2,393
  -3,444
  -4,824
  -6,588
  -8,789
  -11,475
  -14,689
  -18,464
  -22,828
  -27,798
  -33,384
  -39,589
  -46,408
  -53,835
  -61,859
  -70,465
  -79,641
  -89,373
  -99,648
  -110,458
  -121,795
  -133,653
  -146,034
  -158,938
  -172,374
  -186,349
  -200,879
  -215,980
New CAPEX, $m
  -10,465
  -14,570
  -19,669
  -25,806
  -32,982
  -41,152
  -50,229
  -60,096
  -70,607
  -81,607
  -92,940
  -104,456
  -116,023
  -127,528
  -138,886
  -150,036
  -160,940
  -171,587
  -181,984
  -192,156
  -202,141
  -211,990
  -221,760
  -231,514
  -241,317
  -251,238
  -261,345
  -271,705
  -282,383
  -293,443
Cash from investing activities, $m
  -11,519
  -16,183
  -22,062
  -29,250
  -37,806
  -47,740
  -59,018
  -71,571
  -85,296
  -100,071
  -115,768
  -132,254
  -149,407
  -167,117
  -185,294
  -203,871
  -222,799
  -242,052
  -261,625
  -281,529
  -301,789
  -322,448
  -343,555
  -365,167
  -387,351
  -410,176
  -433,719
  -458,054
  -483,262
  -509,423
Free cash flow, $m
  -8,124
  -10,917
  -14,278
  -18,184
  -22,571
  -27,334
  -32,340
  -37,432
  -42,439
  -47,192
  -51,601
  -55,374
  -58,463
  -60,770
  -62,228
  -62,795
  -62,453
  -61,209
  -59,083
  -56,114
  -52,347
  -47,835
  -42,637
  -36,808
  -30,406
  -23,483
  -16,089
  -8,269
  -61
  8,501
Issuance/(repayment) of debt, $m
  8,703
  12,027
  16,236
  21,302
  27,226
  33,969
  41,463
  49,607
  58,284
  67,364
  76,719
  86,225
  95,773
  105,271
  114,646
  123,850
  132,851
  141,640
  150,222
  158,619
  166,862
  174,992
  183,056
  191,107
  199,200
  207,390
  215,732
  224,284
  233,098
  242,229
Issuance/(repurchase) of shares, $m
  5,799
  7,510
  9,583
  11,938
  14,512
  17,211
  19,924
  22,523
  24,875
  26,848
  28,121
  28,985
  29,151
  28,552
  27,140
  24,890
  21,794
  17,860
  13,107
  7,568
  1,278
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  14,502
  19,537
  25,819
  33,240
  41,738
  51,180
  61,387
  72,130
  83,159
  94,212
  104,840
  115,210
  124,924
  133,823
  141,786
  148,740
  154,645
  159,500
  163,329
  166,187
  168,140
  174,992
  183,056
  191,107
  199,200
  207,390
  215,732
  224,284
  233,098
  242,229
Total cash flow (excl. dividends), $m
  6,377
  8,620
  11,541
  15,056
  19,167
  23,847
  29,047
  34,698
  40,719
  47,021
  53,239
  59,836
  66,462
  73,052
  79,559
  85,945
  92,192
  98,291
  104,246
  110,073
  115,793
  127,156
  140,419
  154,299
  168,794
  183,907
  199,643
  216,015
  233,037
  250,729
Retained Cash Flow (-), $m
  -7,141
  -9,880
  -13,338
  -17,500
  -22,366
  -27,906
  -34,061
  -40,752
  -47,880
  -55,339
  -63,024
  -70,834
  -78,677
  -86,479
  -94,181
  -101,742
  -109,136
  -116,356
  -123,407
  -130,304
  -137,076
  -143,754
  -150,379
  -156,994
  -163,641
  -170,369
  -177,223
  -184,248
  -191,489
  -198,989
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
  -763
  -1,260
  -1,797
  -2,443
  -3,199
  -4,059
  -5,015
  -6,054
  -7,160
  -8,318
  -9,785
  -10,998
  -12,215
  -13,427
  -14,623
  -15,796
  -16,945
  -18,066
  -19,160
  -20,231
  -21,282
  -16,598
  -9,960
  -2,694
  5,153
  13,537
  22,420
  31,767
  41,548
  51,740
Discount rate, %
  6.30
  6.62
  6.95
  7.29
  7.66
  8.04
  8.44
  8.86
  9.31
  9.77
  10.26
  10.78
  11.31
  11.88
  12.47
  13.10
  13.75
  14.44
  15.16
  15.92
  16.72
  17.55
  18.43
  19.35
  20.32
  21.33
  22.40
  23.52
  24.70
  25.93
PV of cash for distribution, $m
  -718
  -1,109
  -1,469
  -1,844
  -2,212
  -2,552
  -2,844
  -3,068
  -3,214
  -3,274
  -3,341
  -3,221
  -3,032
  -2,789
  -2,508
  -2,205
  -1,895
  -1,594
  -1,311
  -1,054
  -829
  -473
  -204
  -39
  51
  89
  96
  86
  69
  51
Current shareholders' claim on cash, %
  68.3
  49.1
  36.8
  28.5
  22.8
  18.7
  15.7
  13.5
  11.8
  10.5
  9.5
  8.8
  8.2
  7.7
  7.3
  7.1
  6.9
  6.7
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6
  6.6

EQT Corporation is a natural gas company. The Company operates through three segments: EQT Production, EQT Gathering and EQT Transmission. The EQT Production segment includes its exploration for, and development and production of, natural gas, natural gas liquids and a limited amount of crude oil, primarily in the Appalachian Basin. The EQT Production segment also includes the marketing activities of the Company. EQT Production's properties are located in Pennsylvania, West Virginia, Kentucky and Virginia. The operations of EQT Gathering include the natural gas gathering activities of the Company, consisting solely of assets that are owned and operated by EQT Midstream Partners, LP (EQM). The operations of EQT Transmission include the natural gas transmission and storage activities of the Company, consisting solely of assets that are owned and operated by EQM. EQT Transmission focuses on various transmission projects, including Mountain Valley Pipeline and Transmission Expansion.

FINANCIAL RATIOS  of  EQT (EQT)

Valuation Ratios
P/E Ratio -18.1
Price to Sales 5.1
Price to Book 1.4
Price to Tangible Book
Price to Cash Flow 7.7
Price to Free Cash Flow -17.2
Growth Rates
Sales Growth Rate -31.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -37.2%
Cap. Spend. - 3 Yr. Gr. Rate -2.7%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 56.1%
Total Debt to Equity 56.1%
Interest Coverage -2
Management Effectiveness
Return On Assets -2.7%
Ret/ On Assets - 3 Yr. Avg. 1%
Return On Total Capital -5.2%
Ret/ On T. Cap. - 3 Yr. Avg. 0.4%
Return On Equity -8.3%
Return On Equity - 3 Yr. Avg. 0.8%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 42.2%
EBITDA Margin - 3 Yr. Avg. 54.6%
Operating Margin -17.4%
Oper. Margin - 3 Yr. Avg. 13.8%
Pre-Tax Margin -24.6%
Pre-Tax Margin - 3 Yr. Avg. 7.7%
Net Profit Margin -28.2%
Net Profit Margin - 3 Yr. Avg. -3%
Effective Tax Rate 66.8%
Eff/ Tax Rate - 3 Yr. Avg. 40.3%
Payout Ratio -4.4%

EQT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the EQT stock intrinsic value calculation we used $3378.015 million for the last fiscal year's total revenue generated by EQT. The default revenue input number comes from 0001 income statement of EQT. 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 EQT stock valuation model: a) initial revenue growth rate of 53.1% 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 6.3%, whose default value for EQT is calculated based on our internal credit rating of EQT, 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 EQT.
    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 EQT stock the variable cost ratio is equal to 31.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $1410 million in the base year in the intrinsic value calculation for EQT 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 EQT.

Corporate tax rate of 27% is the nominal tax rate for EQT. 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 EQT 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 EQT are equal to 583.4%.

Life of production assets of 18.7 years is the average useful life of capital assets used in EQT 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 EQT is equal to -9.2%. 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 - $13319.618 million for EQT - 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 264.331 million for EQT 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 EQT at the current share price and the inputted number of shares is $12.5 billion.

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COMPANY NEWS

▶ Harris and EQT rise while Bank of America and Autodesk slip   [Oct-15-18 05:02PM  Associated Press]
▶ EQT Declares Quarterly Cash Dividend   [Oct-10-18 04:10PM  Business Wire]
▶ These 2 Energy Stocks Are Absurdly Cheap   [09:19AM  Motley Fool]
▶ There's another hurdle to the construction of the Mountain Valley Pipeline   [Oct-03-18 12:11PM  American City Business Journals]
▶ Chesapeake Energy Stock Remains High-Risk, High-Reward   [Sep-19-18 02:10PM  InvestorPlace]
▶ What's Wrong With Natural Gas Stocks?   [Sep-16-18 02:42PM  Motley Fool]
▶ EQT Leadership Announcements   [Sep-04-18 07:30AM  Business Wire]
▶ Half of Mountain Valley Pipeline workforce laid off   [Aug-21-18 07:52AM  American City Business Journals]
▶ Oil Prices Fall Despite Supply Fears   [Aug-14-18 03:00PM  Oilprice.com]
▶ EQT CEO-in-waiting sees company as well-positioned for the future   [Aug-09-18 04:35PM  American City Business Journals]
▶ Pipeline's timeline among new EQT midstream leader's list of priorities   [02:25PM  American City Business Journals]
▶ EQT names familiar face as new CEO   [07:49AM  American City Business Journals]
▶ Thomas Karam to Lead EQTs Midstream Business   [06:30AM  Business Wire]
▶ The Oil Bulls Are Back   [Aug-07-18 03:00PM  Oilprice.com]
▶ Pipeline's cost could rise due to FERC shutdown   [Aug-06-18 12:49PM  American City Business Journals]
▶ EQT's use of technology helps improve truck safety   [02:08PM  American City Business Journals]
▶ Mountain Valley Pipeline in-service date slips to 2019   [02:23PM  American City Business Journals]
▶ EQT: 2Q Earnings Snapshot   [06:54AM  Associated Press]
▶ EQT Reports Second Quarter 2018 Results   [06:30AM  Business Wire]
▶ [$$] EQT seeks to raise 8bn infrastructure fund   [12:57AM  Financial Times]
▶ EQT Declares Quarterly Cash Dividend   [Jul-11-18 04:15PM  Business Wire]
▶ Exclusive: 2 natural gas producers cut back in Marcellus   [Jun-26-18 12:24PM  American City Business Journals]
▶ Mountain Valley Pipeline still on schedule despite protests   [Jun-21-18 01:36PM  American City Business Journals]
▶ EQT on schedule to hire new CEO in 3Q   [11:21AM  American City Business Journals]
▶ EQT Midstream Partners Announces Pricing of Senior Notes   [Jun-20-18 05:22PM  Business Wire]
▶ Why EQT's real-time operations center is helping driller make gains   [May-23-18 02:02PM  American City Business Journals]
▶ Landowners fight pipeline in case headed to US appeals court   [May-09-18 12:54PM  Associated Press]
▶ Here's what EQT paid its top execs in 2017   [May-01-18 12:40PM  American City Business Journals]
▶ EQT Corporation (EQT) Jumps: Stock Rises 8.5%   [Apr-27-18 08:51AM  Zacks]
▶ EQT Midstream acquiring midstream assets worth more than $1.5B   [07:53AM  American City Business Journals]
▶ EQT: 1Q Earnings Snapshot   [06:43AM  Associated Press]
▶ EQT Reports First Quarter 2018 Results   [06:30AM  Business Wire]
▶ EQT Declares Quarterly Cash Dividend   [Apr-18-18 03:04PM  Business Wire]
▶ EQT outlines compensation for interim president and CEO   [Mar-21-18 05:16PM  American City Business Journals]
▶ Ex-CEO: Departure due to 'plain vanilla disagreement' with EQT board   [Mar-16-18 03:05PM  American City Business Journals]
▶ Schlotterbeck quits as EQT CEO   [Mar-15-18 03:15PM  American City Business Journals]
▶ EQT Announces Interim Leadership Change   [09:30AM  Business Wire]
▶ 2017 K-1 Tax Package Availability   [Mar-05-18 07:30AM  Business Wire]
▶ 3 Cheap Energy Stocks That Are Poised to Explode in 2018   [Feb-26-18 03:39PM  Insider Monkey]
▶ Stock Market News For Feb 22, 2018   [Feb-22-18 09:58AM  Zacks]
▶ EQT Breaks Up the Family -- Which Is Great   [Feb-21-18 12:40PM  Bloomberg]
▶ EQT to spin off midstream assets   [08:25AM  American City Business Journals]

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