Intrinsic value of Fibria Celulose ADR - FBR

Previous Close

$18.29

  Intrinsic Value

$265.72

stock screener

  Rating & Target

str. buy

+999%

Previous close

$18.29

 
Intrinsic value

$265.72

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of FBR 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, %
  20.10
  18.59
  17.23
  16.01
  14.91
  13.92
  13.02
  12.22
  11.50
  10.85
  10.27
  9.74
  9.26
  8.84
  8.45
  8.11
  7.80
  7.52
  7.27
  7.04
  6.84
  6.65
  6.49
  6.34
  6.20
  6.08
  5.98
  5.88
  5.79
  5.71
Revenue, $m
  4,258
  5,050
  5,920
  6,868
  7,891
  8,989
  10,160
  11,402
  12,713
  14,093
  15,539
  17,053
  18,633
  20,279
  21,994
  23,777
  25,631
  27,559
  29,561
  31,642
  33,805
  36,054
  38,393
  40,826
  43,359
  45,997
  48,746
  51,611
  54,599
  57,718
Variable operating expenses, $m
  2,348
  2,759
  3,210
  3,702
  4,233
  4,803
  5,411
  6,055
  6,735
  7,451
  8,063
  8,848
  9,668
  10,523
  11,412
  12,338
  13,300
  14,300
  15,339
  16,418
  17,541
  18,708
  19,921
  21,184
  22,498
  23,867
  25,293
  26,780
  28,331
  29,949
Fixed operating expenses, $m
  904
  924
  945
  965
  987
  1,008
  1,031
  1,053
  1,076
  1,100
  1,124
  1,149
  1,174
  1,200
  1,227
  1,254
  1,281
  1,309
  1,338
  1,368
  1,398
  1,428
  1,460
  1,492
  1,525
  1,558
  1,593
  1,628
  1,663
  1,700
Total operating expenses, $m
  3,252
  3,683
  4,155
  4,667
  5,220
  5,811
  6,442
  7,108
  7,811
  8,551
  9,187
  9,997
  10,842
  11,723
  12,639
  13,592
  14,581
  15,609
  16,677
  17,786
  18,939
  20,136
  21,381
  22,676
  24,023
  25,425
  26,886
  28,408
  29,994
  31,649
Operating income, $m
  1,006
  1,366
  1,765
  2,200
  2,671
  3,178
  3,719
  4,294
  4,901
  5,541
  6,352
  7,055
  7,790
  8,557
  9,355
  10,186
  11,051
  11,950
  12,884
  13,856
  14,867
  15,918
  17,012
  18,150
  19,336
  20,572
  21,860
  23,203
  24,605
  26,069
EBITDA, $m
  1,850
  2,342
  2,884
  3,476
  4,117
  4,806
  5,541
  6,321
  7,146
  8,015
  8,926
  9,880
  10,877
  11,916
  12,998
  14,125
  15,296
  16,515
  17,781
  19,097
  20,466
  21,890
  23,371
  24,913
  26,518
  28,191
  29,934
  31,753
  33,650
  35,630
Interest expense (income), $m
  34
  379
  467
  565
  673
  790
  917
  1,053
  1,198
  1,352
  1,514
  1,685
  1,864
  2,051
  2,247
  2,451
  2,663
  2,884
  3,113
  3,352
  3,600
  3,857
  4,125
  4,404
  4,693
  4,994
  5,308
  5,635
  5,975
  6,330
  6,699
Earnings before tax, $m
  627
  899
  1,200
  1,527
  1,881
  2,261
  2,666
  3,096
  3,550
  4,027
  4,667
  5,191
  5,739
  6,310
  6,904
  7,523
  8,167
  8,836
  9,532
  10,256
  11,009
  11,793
  12,608
  13,457
  14,342
  15,264
  16,225
  17,229
  18,276
  19,370
Tax expense, $m
  169
  243
  324
  412
  508
  610
  720
  836
  958
  1,087
  1,260
  1,402
  1,550
  1,704
  1,864
  2,031
  2,205
  2,386
  2,574
  2,769
  2,972
  3,184
  3,404
  3,633
  3,872
  4,121
  4,381
  4,652
  4,934
  5,230
Net income, $m
  457
  656
  876
  1,115
  1,373
  1,650
  1,946
  2,260
  2,591
  2,940
  3,407
  3,790
  4,189
  4,606
  5,040
  5,492
  5,962
  6,451
  6,959
  7,487
  8,037
  8,609
  9,204
  9,824
  10,469
  11,143
  11,845
  12,577
  13,341
  14,140

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
  13,102
  15,538
  18,215
  21,131
  24,281
  27,660
  31,262
  35,083
  39,118
  43,362
  47,813
  52,470
  57,331
  62,398
  67,673
  73,161
  78,866
  84,795
  90,957
  97,360
  104,016
  110,935
  118,131
  125,619
  133,413
  141,530
  149,987
  158,803
  167,998
  177,593
Adjusted assets (=assets-cash), $m
  13,102
  15,538
  18,215
  21,131
  24,281
  27,660
  31,262
  35,083
  39,118
  43,362
  47,813
  52,470
  57,331
  62,398
  67,673
  73,161
  78,866
  84,795
  90,957
  97,360
  104,016
  110,935
  118,131
  125,619
  133,413
  141,530
  149,987
  158,803
  167,998
  177,593
Revenue / Adjusted assets
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
  0.325
Average production assets, $m
  5,995
  7,110
  8,335
  9,669
  11,111
  12,657
  14,306
  16,054
  17,900
  19,843
  21,879
  24,010
  26,235
  28,553
  30,967
  33,478
  36,089
  38,802
  41,622
  44,552
  47,598
  50,764
  54,057
  57,483
  61,050
  64,764
  68,634
  72,668
  76,876
  81,267
Working capital, $m
  -85
  -101
  -118
  -137
  -158
  -180
  -203
  -228
  -254
  -282
  -311
  -341
  -373
  -406
  -440
  -476
  -513
  -551
  -591
  -633
  -676
  -721
  -768
  -817
  -867
  -920
  -975
  -1,032
  -1,092
  -1,154
Total debt, $m
  7,188
  8,696
  10,353
  12,158
  14,108
  16,200
  18,430
  20,795
  23,292
  25,919
  28,675
  31,557
  34,566
  37,703
  40,968
  44,365
  47,896
  51,567
  55,381
  59,344
  63,464
  67,747
  72,201
  76,836
  81,661
  86,685
  91,920
  97,377
  103,069
  109,008
Total liabilities, $m
  8,110
  9,618
  11,275
  13,080
  15,030
  17,121
  19,351
  21,717
  24,214
  26,841
  29,597
  32,479
  35,488
  38,624
  41,890
  45,287
  48,818
  52,488
  56,302
  60,266
  64,386
  68,669
  73,123
  77,758
  82,582
  87,607
  92,842
  98,299
  103,991
  109,930
Total equity, $m
  4,992
  5,920
  6,940
  8,051
  9,251
  10,538
  11,911
  13,367
  14,904
  16,521
  18,217
  19,991
  21,843
  23,774
  25,784
  27,874
  30,048
  32,307
  34,655
  37,094
  39,630
  42,266
  45,008
  47,861
  50,830
  53,923
  57,145
  60,504
  64,007
  67,663
Total liabilities and equity, $m
  13,102
  15,538
  18,215
  21,131
  24,281
  27,659
  31,262
  35,084
  39,118
  43,362
  47,814
  52,470
  57,331
  62,398
  67,674
  73,161
  78,866
  84,795
  90,957
  97,360
  104,016
  110,935
  118,131
  125,619
  133,412
  141,530
  149,987
  158,803
  167,998
  177,593
Debt-to-equity ratio
  1.440
  1.470
  1.490
  1.510
  1.530
  1.540
  1.550
  1.560
  1.560
  1.570
  1.570
  1.580
  1.580
  1.590
  1.590
  1.590
  1.590
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.610
  1.610
  1.610
  1.610
  1.610
  1.610
  1.610
Adjusted equity ratio
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381
  0.381

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  457
  656
  876
  1,115
  1,373
  1,650
  1,946
  2,260
  2,591
  2,940
  3,407
  3,790
  4,189
  4,606
  5,040
  5,492
  5,962
  6,451
  6,959
  7,487
  8,037
  8,609
  9,204
  9,824
  10,469
  11,143
  11,845
  12,577
  13,341
  14,140
Depreciation, amort., depletion, $m
  844
  975
  1,119
  1,276
  1,446
  1,628
  1,822
  2,027
  2,245
  2,473
  2,574
  2,825
  3,086
  3,359
  3,643
  3,939
  4,246
  4,565
  4,897
  5,241
  5,600
  5,972
  6,360
  6,763
  7,182
  7,619
  8,075
  8,549
  9,044
  9,561
Funds from operations, $m
  1,301
  1,632
  1,995
  2,391
  2,819
  3,278
  3,768
  4,287
  4,836
  5,413
  5,981
  6,614
  7,276
  7,965
  8,683
  9,431
  10,208
  11,015
  11,855
  12,728
  13,636
  14,581
  15,563
  16,586
  17,652
  18,762
  19,919
  21,126
  22,386
  23,701
Change in working capital, $m
  -14
  -16
  -17
  -19
  -20
  -22
  -23
  -25
  -26
  -28
  -29
  -30
  -32
  -33
  -34
  -36
  -37
  -39
  -40
  -42
  -43
  -45
  -47
  -49
  -51
  -53
  -55
  -57
  -60
  -62
Cash from operations, $m
  1,316
  1,647
  2,012
  2,410
  2,839
  3,300
  3,791
  4,312
  4,862
  5,441
  6,010
  6,645
  7,307
  7,998
  8,718
  9,466
  10,245
  11,054
  11,895
  12,770
  13,680
  14,626
  15,610
  16,635
  17,702
  18,815
  19,974
  21,183
  22,445
  23,763
Maintenance CAPEX, $m
  -587
  -705
  -836
  -981
  -1,138
  -1,307
  -1,489
  -1,683
  -1,889
  -2,106
  -2,334
  -2,574
  -2,825
  -3,086
  -3,359
  -3,643
  -3,939
  -4,246
  -4,565
  -4,897
  -5,241
  -5,600
  -5,972
  -6,360
  -6,763
  -7,182
  -7,619
  -8,075
  -8,549
  -9,044
New CAPEX, $m
  -1,004
  -1,115
  -1,225
  -1,334
  -1,441
  -1,546
  -1,649
  -1,748
  -1,846
  -1,942
  -2,037
  -2,131
  -2,224
  -2,319
  -2,414
  -2,511
  -2,611
  -2,713
  -2,820
  -2,930
  -3,045
  -3,166
  -3,293
  -3,426
  -3,567
  -3,714
  -3,870
  -4,034
  -4,208
  -4,391
Cash from investing activities, $m
  -1,591
  -1,820
  -2,061
  -2,315
  -2,579
  -2,853
  -3,138
  -3,431
  -3,735
  -4,048
  -4,371
  -4,705
  -5,049
  -5,405
  -5,773
  -6,154
  -6,550
  -6,959
  -7,385
  -7,827
  -8,286
  -8,766
  -9,265
  -9,786
  -10,330
  -10,896
  -11,489
  -12,109
  -12,757
  -13,435
Free cash flow, $m
  -276
  -172
  -49
  95
  260
  447
  654
  881
  1,127
  1,393
  1,639
  1,940
  2,258
  2,593
  2,944
  3,312
  3,695
  4,095
  4,511
  4,943
  5,393
  5,860
  6,345
  6,849
  7,373
  7,918
  8,485
  9,074
  9,688
  10,328
Issuance/(repayment) of debt, $m
  1,360
  1,508
  1,657
  1,805
  1,950
  2,092
  2,230
  2,365
  2,497
  2,627
  2,755
  2,882
  3,009
  3,136
  3,265
  3,397
  3,531
  3,670
  3,814
  3,964
  4,120
  4,283
  4,455
  4,635
  4,824
  5,024
  5,235
  5,457
  5,692
  5,939
Issuance/(repurchase) of shares, $m
  376
  272
  144
  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  
  1,736
  1,780
  1,801
  1,805
  1,950
  2,092
  2,230
  2,365
  2,497
  2,627
  2,755
  2,882
  3,009
  3,136
  3,265
  3,397
  3,531
  3,670
  3,814
  3,964
  4,120
  4,283
  4,455
  4,635
  4,824
  5,024
  5,235
  5,457
  5,692
  5,939
Total cash flow (excl. dividends), $m
  1,460
  1,607
  1,752
  1,900
  2,210
  2,538
  2,884
  3,246
  3,625
  4,020
  4,394
  4,822
  5,267
  5,730
  6,210
  6,709
  7,227
  7,765
  8,325
  8,907
  9,512
  10,143
  10,800
  11,484
  12,198
  12,942
  13,720
  14,532
  15,380
  16,267
Retained Cash Flow (-), $m
  -833
  -928
  -1,020
  -1,111
  -1,200
  -1,287
  -1,373
  -1,456
  -1,537
  -1,617
  -1,696
  -1,774
  -1,852
  -1,931
  -2,010
  -2,091
  -2,174
  -2,259
  -2,348
  -2,440
  -2,536
  -2,636
  -2,742
  -2,853
  -2,970
  -3,093
  -3,222
  -3,359
  -3,503
  -3,656
Prev. year cash balance distribution, $m
  266
  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
  893
  679
  732
  789
  1,010
  1,251
  1,511
  1,790
  2,087
  2,403
  2,698
  3,048
  3,415
  3,799
  4,200
  4,618
  5,053
  5,506
  5,977
  6,467
  6,977
  7,507
  8,058
  8,631
  9,228
  9,850
  10,498
  11,173
  11,877
  12,612
Discount rate, %
  5.50
  5.78
  6.06
  6.37
  6.69
  7.02
  7.37
  7.74
  8.13
  8.53
  8.96
  9.41
  9.88
  10.37
  10.89
  11.43
  12.01
  12.61
  13.24
  13.90
  14.59
  15.32
  16.09
  16.89
  17.74
  18.62
  19.56
  20.53
  21.56
  22.64
PV of cash for distribution, $m
  846
  607
  614
  616
  731
  833
  919
  986
  1,033
  1,060
  1,050
  1,036
  1,004
  954
  891
  817
  735
  650
  563
  479
  399
  326
  261
  204
  156
  116
  84
  60
  41
  28
Current shareholders' claim on cash, %
  88.6
  82.2
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4
  79.4

Fibria Celulose S.A. (Fibria) is a forestry company, which is engaged in the production of eucalyptus pulp. The Company is engaged in the production and sale of short fiber pulp from its pulp production facilities located in the cities of Aracruz (State of Espirito Santo), Tres Lagoas (State of Mato Grosso do Sul), Jacarei (State of Sao Paulo) and Eunapolis (State of Bahia). The Company's activities are focused on the growth of renewable and forests, and the manufacture and sale of bleached eucalyptus kraft pulp. The Company's annual production capacity is approximately 5.3 million tons of pulp. Fibria has over 969,000 hectares of forests, with approximately 568,000 hectares of planted forests, over 338,000 hectares of environmental preservation and conservation areas, and approximately 63,000 hectares destined for other uses. The pulp produced by Fibria is exported to approximately 40 countries. The pulp produced for export is delivered to customers by sea and through various ports.

FINANCIAL RATIOS  of  Fibria Celulose ADR (FBR)

Valuation Ratios
P/E Ratio 19.4
Price to Sales 3.3
Price to Book 2.3
Price to Tangible Book
Price to Cash Flow 8.2
Price to Free Cash Flow -14.8
Growth Rates
Sales Growth Rate -4.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 158.4%
Cap. Spend. - 3 Yr. Gr. Rate 38.6%
Financial Strength
Quick Ratio 5
Current Ratio 0.1
LT Debt to Equity 109.2%
Total Debt to Equity 115.9%
Interest Coverage 29
Management Effectiveness
Return On Assets 5.4%
Ret/ On Assets - 3 Yr. Avg. 6.7%
Return On Total Capital 6%
Ret/ On T. Cap. - 3 Yr. Avg. 2.7%
Return On Equity 12.5%
Return On Equity - 3 Yr. Avg. 5.4%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 26.1%
Gross Margin - 3 Yr. Avg. 29.8%
EBITDA Margin 53.4%
EBITDA Margin - 3 Yr. Avg. 34.6%
Operating Margin 14.8%
Oper. Margin - 3 Yr. Avg. 24.4%
Pre-Tax Margin 31.6%
Pre-Tax Margin - 3 Yr. Avg. 10.1%
Net Profit Margin 17.2%
Net Profit Margin - 3 Yr. Avg. 7.6%
Effective Tax Rate 45.3%
Eff/ Tax Rate - 3 Yr. Avg. -87.2%
Payout Ratio 18.5%

FBR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the FBR stock intrinsic value calculation we used $3545.50075506 million for the last fiscal year's total revenue generated by Fibria Celulose ADR. The default revenue input number comes from 0001 income statement of Fibria Celulose ADR. 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 FBR stock valuation model: a) initial revenue growth rate of 20.1% 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 5.5%, whose default value for FBR is calculated based on our internal credit rating of Fibria Celulose ADR, 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 Fibria Celulose ADR.
    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 FBR stock the variable cost ratio is equal to 55.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $885 million in the base year in the intrinsic value calculation for FBR 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 6.5% for Fibria Celulose ADR.

Corporate tax rate of 27% is the nominal tax rate for Fibria Celulose ADR. 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 FBR 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 FBR are equal to 140.8%.

Life of production assets of 8.5 years is the average useful life of capital assets used in Fibria Celulose ADR 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 FBR is equal to -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 - $4424.62367865 million for Fibria Celulose ADR - 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 54.576 million for Fibria Celulose ADR 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 Fibria Celulose ADR at the current share price and the inputted number of shares is $1.0 billion.

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