Intrinsic value of Foundation Building Materials - FBM

Previous Close

$15.58

  Intrinsic Value

$33.34

stock screener

  Rating & Target

str. buy

+114%

Previous close

$15.58

 
Intrinsic value

$33.34

 
Up/down potential

+114%

 
Rating

str. buy

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of FBM 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

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  69.67
  28.60
  26.24
  24.12
  22.20
  20.48
  18.94
  17.54
  16.29
  15.16
  14.14
  13.23
  12.41
  11.67
  11.00
  10.40
  9.86
  9.37
  8.94
  8.54
  8.19
  7.87
  7.58
  7.32
  7.09
  6.88
  6.69
  6.52
  6.37
  6.24
  6.11
Revenue, $m
  1,393
  1,791
  2,261
  2,807
  3,430
  4,133
  4,915
  5,777
  6,718
  7,737
  8,831
  9,999
  11,240
  12,551
  13,932
  15,380
  16,897
  18,481
  20,132
  21,852
  23,641
  25,501
  27,435
  29,444
  31,532
  33,702
  35,958
  38,305
  40,746
  43,286
  45,932
Variable operating expenses, $m
 
  1,671
  2,098
  2,594
  3,160
  3,799
  4,510
  5,293
  6,148
  7,073
  8,067
  9,085
  10,212
  11,403
  12,658
  13,974
  15,352
  16,791
  18,291
  19,853
  21,479
  23,169
  24,926
  26,752
  28,649
  30,620
  32,670
  34,802
  37,020
  39,328
  41,731
Fixed operating expenses, $m
 
  70
  71
  73
  75
  77
  79
  81
  83
  85
  87
  89
  91
  94
  96
  98
  101
  103
  106
  109
  111
  114
  117
  120
  123
  126
  129
  132
  136
  139
  143
Total operating expenses, $m
  1,376
  1,741
  2,169
  2,667
  3,235
  3,876
  4,589
  5,374
  6,231
  7,158
  8,154
  9,174
  10,303
  11,497
  12,754
  14,072
  15,453
  16,894
  18,397
  19,962
  21,590
  23,283
  25,043
  26,872
  28,772
  30,746
  32,799
  34,934
  37,156
  39,467
  41,874
Operating income, $m
  17
  50
  92
  140
  195
  257
  327
  404
  488
  579
  677
  825
  936
  1,054
  1,178
  1,308
  1,444
  1,586
  1,735
  1,889
  2,050
  2,218
  2,392
  2,572
  2,760
  2,956
  3,159
  3,370
  3,590
  3,819
  4,057
EBITDA, $m
  68
  123
  172
  229
  294
  368
  450
  541
  641
  748
  864
  988
  1,119
  1,258
  1,404
  1,558
  1,719
  1,887
  2,062
  2,245
  2,435
  2,632
  2,837
  3,051
  3,273
  3,503
  3,743
  3,993
  4,252
  4,522
  4,804
Interest expense (income), $m
  20
  26
  37
  49
  63
  79
  97
  117
  139
  163
  189
  217
  247
  279
  313
  348
  385
  424
  465
  507
  551
  597
  645
  694
  746
  799
  855
  913
  973
  1,036
  1,101
Earnings before tax, $m
  -43
  24
  55
  91
  132
  178
  230
  287
  349
  416
  488
  608
  689
  775
  865
  960
  1,059
  1,162
  1,270
  1,382
  1,499
  1,621
  1,747
  1,878
  2,015
  2,156
  2,304
  2,457
  2,617
  2,783
  2,957
Tax expense, $m
  -15
  6
  15
  25
  36
  48
  62
  77
  94
  112
  132
  164
  186
  209
  234
  259
  286
  314
  343
  373
  405
  438
  472
  507
  544
  582
  622
  663
  707
  751
  798
Net income, $m
  -28
  17
  40
  66
  96
  130
  168
  209
  255
  303
  356
  444
  503
  566
  632
  701
  773
  849
  927
  1,009
  1,094
  1,183
  1,275
  1,371
  1,471
  1,574
  1,682
  1,794
  1,910
  2,032
  2,158

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  29
  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
  1,321
  1,662
  2,098
  2,604
  3,182
  3,834
  4,560
  5,359
  6,232
  7,177
  8,192
  9,276
  10,427
  11,643
  12,924
  14,268
  15,674
  17,143
  18,675
  20,270
  21,930
  23,656
  25,450
  27,314
  29,251
  31,264
  33,357
  35,533
  37,797
  40,154
  42,608
Adjusted assets (=assets-cash), $m
  1,292
  1,662
  2,098
  2,604
  3,182
  3,834
  4,560
  5,359
  6,232
  7,177
  8,192
  9,276
  10,427
  11,643
  12,924
  14,268
  15,674
  17,143
  18,675
  20,270
  21,930
  23,656
  25,450
  27,314
  29,251
  31,264
  33,357
  35,533
  37,797
  40,154
  42,608
Revenue / Adjusted assets
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
  1.078
Average production assets, $m
  290
  373
  470
  584
  713
  860
  1,022
  1,202
  1,397
  1,609
  1,837
  2,080
  2,338
  2,611
  2,898
  3,199
  3,515
  3,844
  4,187
  4,545
  4,917
  5,304
  5,706
  6,124
  6,559
  7,010
  7,479
  7,967
  8,475
  9,004
  9,554
Working capital, $m
  308
  358
  452
  561
  686
  827
  983
  1,155
  1,344
  1,547
  1,766
  2,000
  2,248
  2,510
  2,786
  3,076
  3,379
  3,696
  4,026
  4,370
  4,728
  5,100
  5,487
  5,889
  6,306
  6,740
  7,192
  7,661
  8,149
  8,657
  9,186
Total debt, $m
  734
  1,018
  1,353
  1,742
  2,186
  2,686
  3,244
  3,858
  4,528
  5,254
  6,034
  6,866
  7,750
  8,684
  9,667
  10,699
  11,780
  12,908
  14,085
  15,310
  16,584
  17,910
  19,287
  20,719
  22,206
  23,753
  25,360
  27,031
  28,770
  30,580
  32,465
Total liabilities, $m
  992
  1,276
  1,611
  2,000
  2,444
  2,944
  3,502
  4,116
  4,786
  5,512
  6,292
  7,124
  8,008
  8,942
  9,925
  10,957
  12,038
  13,166
  14,343
  15,568
  16,842
  18,168
  19,545
  20,977
  22,464
  24,011
  25,618
  27,289
  29,028
  30,838
  32,723
Total equity, $m
  329
  386
  487
  604
  738
  889
  1,058
  1,243
  1,446
  1,665
  1,901
  2,152
  2,419
  2,701
  2,998
  3,310
  3,636
  3,977
  4,333
  4,703
  5,088
  5,488
  5,904
  6,337
  6,786
  7,253
  7,739
  8,244
  8,769
  9,316
  9,885
Total liabilities and equity, $m
  1,321
  1,662
  2,098
  2,604
  3,182
  3,833
  4,560
  5,359
  6,232
  7,177
  8,193
  9,276
  10,427
  11,643
  12,923
  14,267
  15,674
  17,143
  18,676
  20,271
  21,930
  23,656
  25,449
  27,314
  29,250
  31,264
  33,357
  35,533
  37,797
  40,154
  42,608
Debt-to-equity ratio
  2.231
  2.640
  2.780
  2.880
  2.960
  3.020
  3.070
  3.100
  3.130
  3.160
  3.170
  3.190
  3.200
  3.210
  3.220
  3.230
  3.240
  3.250
  3.250
  3.260
  3.260
  3.260
  3.270
  3.270
  3.270
  3.270
  3.280
  3.280
  3.280
  3.280
  3.280
Adjusted equity ratio
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232
  0.232

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -28
  17
  40
  66
  96
  130
  168
  209
  255
  303
  356
  444
  503
  566
  632
  701
  773
  849
  927
  1,009
  1,094
  1,183
  1,275
  1,371
  1,471
  1,574
  1,682
  1,794
  1,910
  2,032
  2,158
Depreciation, amort., depletion, $m
  51
  73
  81
  89
  100
  111
  124
  138
  153
  170
  187
  162
  183
  204
  226
  250
  275
  300
  327
  355
  384
  414
  446
  478
  512
  548
  584
  622
  662
  703
  746
Funds from operations, $m
  33
  90
  121
  156
  196
  241
  292
  347
  408
  473
  543
  606
  686
  770
  858
  951
  1,048
  1,149
  1,254
  1,364
  1,479
  1,597
  1,721
  1,849
  1,983
  2,122
  2,266
  2,416
  2,573
  2,735
  2,905
Change in working capital, $m
  0
  80
  94
  109
  125
  141
  157
  172
  188
  204
  219
  234
  248
  262
  276
  290
  303
  317
  330
  344
  358
  372
  387
  402
  418
  434
  451
  469
  488
  508
  529
Cash from operations, $m
  33
  11
  27
  47
  71
  101
  135
  175
  219
  269
  324
  373
  438
  507
  582
  661
  744
  832
  924
  1,020
  1,121
  1,225
  1,334
  1,448
  1,565
  1,688
  1,815
  1,947
  2,084
  2,227
  2,376
Maintenance CAPEX, $m
  0
  -23
  -29
  -37
  -46
  -56
  -67
  -80
  -94
  -109
  -126
  -144
  -162
  -183
  -204
  -226
  -250
  -275
  -300
  -327
  -355
  -384
  -414
  -446
  -478
  -512
  -548
  -584
  -622
  -662
  -703
New CAPEX, $m
  -30
  -83
  -98
  -113
  -130
  -146
  -163
  -179
  -196
  -212
  -228
  -243
  -258
  -273
  -287
  -301
  -315
  -329
  -343
  -358
  -372
  -387
  -402
  -418
  -434
  -451
  -469
  -488
  -508
  -528
  -550
Cash from investing activities, $m
  -432
  -106
  -127
  -150
  -176
  -202
  -230
  -259
  -290
  -321
  -354
  -387
  -420
  -456
  -491
  -527
  -565
  -604
  -643
  -685
  -727
  -771
  -816
  -864
  -912
  -963
  -1,017
  -1,072
  -1,130
  -1,190
  -1,253
Free cash flow, $m
  -399
  -95
  -100
  -103
  -104
  -101
  -95
  -85
  -70
  -52
  -29
  -14
  17
  52
  91
  133
  179
  228
  280
  335
  393
  454
  518
  584
  653
  724
  798
  875
  954
  1,037
  1,122
Issuance/(repayment) of debt, $m
  385
  284
  335
  389
  444
  501
  558
  614
  670
  726
  780
  832
  884
  934
  983
  1,032
  1,080
  1,128
  1,176
  1,225
  1,275
  1,325
  1,378
  1,432
  1,488
  1,546
  1,607
  1,672
  1,739
  1,810
  1,885
Issuance/(repurchase) of shares, $m
  0
  68
  61
  51
  38
  21
  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  
  417
  352
  396
  440
  482
  522
  558
  614
  670
  726
  780
  832
  884
  934
  983
  1,032
  1,080
  1,128
  1,176
  1,225
  1,275
  1,325
  1,378
  1,432
  1,488
  1,546
  1,607
  1,672
  1,739
  1,810
  1,885
Total cash flow (excl. dividends), $m
  18
  257
  296
  336
  378
  420
  463
  530
  600
  674
  751
  818
  901
  986
  1,074
  1,165
  1,259
  1,356
  1,457
  1,561
  1,668
  1,780
  1,895
  2,015
  2,140
  2,270
  2,405
  2,546
  2,693
  2,847
  3,007
Retained Cash Flow (-), $m
  -38
  -86
  -101
  -117
  -134
  -151
  -168
  -186
  -203
  -219
  -235
  -251
  -267
  -282
  -297
  -312
  -326
  -341
  -355
  -370
  -385
  -400
  -416
  -432
  -449
  -467
  -486
  -505
  -525
  -547
  -569
Prev. year cash balance distribution, $m
 
  29
  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
 
  201
  195
  219
  244
  269
  295
  344
  398
  455
  515
  567
  634
  704
  777
  854
  933
  1,016
  1,101
  1,191
  1,283
  1,379
  1,479
  1,583
  1,691
  1,803
  1,920
  2,041
  2,168
  2,300
  2,437
Discount rate, %
 
  11.10
  11.66
  12.24
  12.85
  13.49
  14.17
  14.88
  15.62
  16.40
  17.22
  18.08
  18.98
  19.93
  20.93
  21.98
  23.08
  24.23
  25.44
  26.71
  28.05
  29.45
  30.92
  32.47
  34.09
  35.80
  37.59
  39.47
  41.44
  43.51
  45.69
PV of cash for distribution, $m
 
  181
  156
  155
  150
  143
  133
  130
  125
  116
  105
  91
  79
  66
  54
  43
  34
  25
  19
  13
  9
  6
  4
  2
  1
  1
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  90.1
  83.6
  79.6
  77.2
  76.2
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1
  76.1

Foundation Building Materials, Inc. is a specialty distributor of wallboard and suspended ceiling systems in the United States and Canada. The Company’s segments include Specialty Building Products and Mechanical Insulation. The Company fabricates and distributes its products for specialty contractors seeking to improve or maintain energy efficiency in a range of commercial and industrial buildings. It serves markets across the United States and in Canada. Specialty building products segment distributes wallboard and accessories, metal framing, suspended ceiling systems and other products. Other products include stucco and Exterior insulation and finish system (EIFS), as well as offerings, such as tools, safety accessories and fasteners. Its Mechanical insulation segment includes insulation solutions for pipes and mechanical systems and the primary end markets served are new non-residential construction, non- residential repair and remodel construction and industrial markets.


Warning: Division by zero in /home3/webhub/public_html/x-fin.com/stocks/a-inc/ratios.php on line 11

Warning: Division by zero in /home3/webhub/public_html/x-fin.com/stocks/a-inc/ratios.php on line 13

Warning: Division by zero in /home3/webhub/public_html/x-fin.com/stocks/a-inc/ratios.php on line 13

FINANCIAL RATIOS  of  Foundation Building Materials (FBM)

Valuation Ratios
P/E Ratio -23.9
Price to Sales 0.5
Price to Book 2
Price to Tangible Book
Price to Cash Flow 20.2
Price to Free Cash Flow 222.6
Growth Rates
Sales Growth Rate 69.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 130.8%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 223.1%
Total Debt to Equity 223.1%
Interest Coverage -1
Management Effectiveness
Return On Assets -1.4%
Ret/ On Assets - 3 Yr. Avg. 2.7%
Return On Total Capital -3.2%
Ret/ On T. Cap. - 3 Yr. Avg. -4.5%
Return On Equity -9%
Return On Equity - 3 Yr. Avg. -13.2%
Asset Turnover 1.3
Profitability Ratios
Gross Margin 28.5%
Gross Margin - 3 Yr. Avg. 27.8%
EBITDA Margin 2%
EBITDA Margin - 3 Yr. Avg. 2.1%
Operating Margin 1.2%
Oper. Margin - 3 Yr. Avg. 0.3%
Pre-Tax Margin -3.1%
Pre-Tax Margin - 3 Yr. Avg. -2.8%
Net Profit Margin -2%
Net Profit Margin - 3 Yr. Avg. -2.3%
Effective Tax Rate 34.9%
Eff/ Tax Rate - 3 Yr. Avg. -17.1%
Payout Ratio 0%

FBM stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the FBM stock intrinsic value calculation we used $1393 million for the last fiscal year's total revenue generated by Foundation Building Materials. The default revenue input number comes from 2016 income statement of Foundation Building Materials. 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 FBM stock valuation model: a) initial revenue growth rate of 28.6% 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 11.1%, whose default value for FBM is calculated based on our internal credit rating of Foundation Building Materials, 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 Foundation Building Materials.
    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 FBM stock the variable cost ratio is equal to 94%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $68 million in the base year in the intrinsic value calculation for FBM 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 3.6% for Foundation Building Materials.

Corporate tax rate of 27% is the nominal tax rate for Foundation Building Materials. 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 FBM 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 FBM are equal to 20.8%.

Life of production assets of 12.8 years is the average useful life of capital assets used in Foundation Building Materials 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 FBM is equal to 20%. 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 - $329 million for Foundation Building Materials - 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 43.416 million for Foundation Building Materials 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 Foundation Building Materials at the current share price and the inputted number of shares is $0.7 billion.

Financial statements of FBM
Follow us on:   twitter   twitter   twitter   twitter

ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2018. All rigths reserved.