Intrinsic value of Hudson Technologies, Inc. - HDSN

Previous Close

$1.12

  Intrinsic Value

$5.13

stock screener

  Rating & Target

str. buy

+358%

Previous close

$1.12

 
Intrinsic value

$5.13

 
Up/down potential

+358%

 
Rating

str. buy

We calculate the intrinsic value of HDSN 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 0.0

 

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, %
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  224
  346
  518
  751
  1,059
  1,457
  1,955
  2,567
  3,303
  4,172
  5,181
  6,335
  7,635
  9,084
  10,682
  12,425
  14,313
  16,341
  18,508
  20,808
  23,240
  25,800
  28,488
  31,301
  34,239
  37,303
  40,494
  43,813
  47,265
  50,853
Variable operating expenses, $m
  182
  280
  417
  603
  850
  1,168
  1,566
  2,056
  2,644
  3,339
  4,143
  5,065
  6,105
  7,264
  8,541
  9,935
  11,444
  13,066
  14,798
  16,637
  18,582
  20,629
  22,778
  25,027
  27,377
  29,826
  32,377
  35,032
  37,792
  40,660
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
  182
  280
  417
  603
  850
  1,168
  1,566
  2,056
  2,644
  3,339
  4,143
  5,065
  6,105
  7,264
  8,541
  9,935
  11,444
  13,066
  14,798
  16,637
  18,582
  20,629
  22,778
  25,027
  27,377
  29,826
  32,377
  35,032
  37,792
  40,660
Operating income, $m
  42
  66
  101
  148
  209
  289
  389
  512
  659
  833
  1,038
  1,270
  1,530
  1,821
  2,141
  2,490
  2,869
  3,275
  3,709
  4,171
  4,658
  5,171
  5,710
  6,274
  6,862
  7,477
  8,116
  8,781
  9,473
  10,192
EBITDA, $m
  48
  75
  112
  162
  229
  315
  423
  555
  714
  902
  1,120
  1,369
  1,650
  1,963
  2,309
  2,686
  3,094
  3,532
  4,000
  4,497
  5,023
  5,576
  6,157
  6,765
  7,400
  8,062
  8,752
  9,470
  10,216
  10,991
Interest expense (income), $m
  1
  9
  15
  25
  38
  56
  79
  109
  148
  194
  250
  317
  394
  482
  581
  691
  813
  946
  1,090
  1,245
  1,410
  1,586
  1,771
  1,967
  2,172
  2,386
  2,611
  2,844
  3,088
  3,341
  3,604
Earnings before tax, $m
  33
  51
  76
  110
  154
  210
  279
  364
  465
  583
  722
  876
  1,049
  1,240
  1,449
  1,677
  1,922
  2,185
  2,464
  2,760
  3,072
  3,400
  3,743
  4,102
  4,476
  4,866
  5,272
  5,694
  6,132
  6,588
Tax expense, $m
  9
  14
  21
  30
  42
  57
  75
  98
  126
  157
  195
  237
  283
  335
  391
  453
  519
  590
  665
  745
  829
  918
  1,011
  1,107
  1,209
  1,314
  1,423
  1,537
  1,656
  1,779
Net income, $m
  24
  37
  55
  80
  112
  153
  204
  266
  339
  426
  527
  639
  766
  905
  1,058
  1,224
  1,403
  1,595
  1,799
  2,015
  2,243
  2,482
  2,732
  2,994
  3,268
  3,552
  3,848
  4,156
  4,477
  4,809

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
  514
  794
  1,187
  1,722
  2,430
  3,341
  4,484
  5,888
  7,577
  9,570
  11,883
  14,529
  17,512
  20,836
  24,499
  28,498
  32,828
  37,480
  42,448
  47,725
  53,302
  59,175
  65,339
  71,791
  78,530
  85,557
  92,875
  100,489
  108,406
  116,635
Adjusted assets (=assets-cash), $m
  514
  794
  1,187
  1,722
  2,430
  3,341
  4,484
  5,888
  7,577
  9,570
  11,883
  14,529
  17,512
  20,836
  24,499
  28,498
  32,828
  37,480
  42,448
  47,725
  53,302
  59,175
  65,339
  71,791
  78,530
  85,557
  92,875
  100,489
  108,406
  116,635
Revenue / Adjusted assets
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
  0.436
Average production assets, $m
  65
  100
  150
  217
  306
  421
  565
  742
  955
  1,206
  1,497
  1,831
  2,207
  2,625
  3,087
  3,591
  4,136
  4,723
  5,349
  6,013
  6,716
  7,456
  8,233
  9,046
  9,895
  10,781
  11,703
  12,662
  13,660
  14,696
Working capital, $m
  112
  173
  259
  375
  530
  728
  978
  1,284
  1,652
  2,086
  2,591
  3,167
  3,818
  4,542
  5,341
  6,213
  7,156
  8,171
  9,254
  10,404
  11,620
  12,900
  14,244
  15,650
  17,119
  18,651
  20,247
  21,907
  23,633
  25,426
Total debt, $m
  286
  458
  701
  1,030
  1,466
  2,027
  2,732
  3,596
  4,637
  5,864
  7,290
  8,919
  10,757
  12,804
  15,061
  17,524
  20,191
  23,057
  26,118
  29,368
  32,803
  36,421
  40,218
  44,192
  48,344
  52,672
  57,180
  61,871
  66,748
  71,816
Total liabilities, $m
  316
  489
  731
  1,061
  1,497
  2,058
  2,762
  3,627
  4,667
  5,895
  7,320
  8,950
  10,787
  12,835
  15,092
  17,555
  20,222
  23,088
  26,148
  29,398
  32,834
  36,452
  40,249
  44,223
  48,374
  52,703
  57,211
  61,901
  66,778
  71,847
Total equity, $m
  197
  305
  456
  661
  933
  1,283
  1,722
  2,261
  2,909
  3,675
  4,563
  5,579
  6,725
  8,001
  9,408
  10,943
  12,606
  14,392
  16,300
  18,326
  20,468
  22,723
  25,090
  27,568
  30,155
  32,854
  35,664
  38,588
  41,628
  44,788
Total liabilities and equity, $m
  513
  794
  1,187
  1,722
  2,430
  3,341
  4,484
  5,888
  7,576
  9,570
  11,883
  14,529
  17,512
  20,836
  24,500
  28,498
  32,828
  37,480
  42,448
  47,724
  53,302
  59,175
  65,339
  71,791
  78,529
  85,557
  92,875
  100,489
  108,406
  116,635
Debt-to-equity ratio
  1.450
  1.500
  1.540
  1.560
  1.570
  1.580
  1.590
  1.590
  1.590
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
  1.600
Adjusted equity ratio
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384
  0.384

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  24
  37
  55
  80
  112
  153
  204
  266
  339
  426
  527
  639
  766
  905
  1,058
  1,224
  1,403
  1,595
  1,799
  2,015
  2,243
  2,482
  2,732
  2,994
  3,268
  3,552
  3,848
  4,156
  4,477
  4,809
Depreciation, amort., depletion, $m
  7
  8
  11
  15
  20
  26
  34
  43
  55
  69
  81
  99
  120
  143
  168
  195
  225
  257
  291
  327
  365
  405
  447
  492
  538
  586
  636
  688
  742
  799
Funds from operations, $m
  31
  46
  67
  95
  132
  179
  238
  309
  394
  494
  608
  739
  885
  1,048
  1,226
  1,419
  1,628
  1,852
  2,090
  2,342
  2,608
  2,887
  3,180
  3,486
  3,805
  4,138
  4,484
  4,845
  5,219
  5,608
Change in working capital, $m
  42
  61
  86
  117
  154
  199
  249
  306
  368
  435
  504
  577
  650
  725
  799
  872
  944
  1,014
  1,083
  1,150
  1,216
  1,280
  1,344
  1,407
  1,469
  1,532
  1,595
  1,660
  1,726
  1,794
Cash from operations, $m
  -11
  -15
  -19
  -22
  -22
  -20
  -12
  3
  26
  60
  104
  162
  235
  323
  427
  548
  684
  837
  1,007
  1,192
  1,392
  1,607
  1,836
  2,079
  2,336
  2,606
  2,889
  3,185
  3,493
  3,814
Maintenance CAPEX, $m
  -2
  -4
  -5
  -8
  -12
  -17
  -23
  -31
  -40
  -52
  -66
  -81
  -99
  -120
  -143
  -168
  -195
  -225
  -257
  -291
  -327
  -365
  -405
  -447
  -492
  -538
  -586
  -636
  -688
  -742
New CAPEX, $m
  -24
  -35
  -50
  -67
  -89
  -115
  -144
  -177
  -213
  -251
  -292
  -333
  -376
  -419
  -462
  -504
  -546
  -586
  -626
  -665
  -703
  -740
  -777
  -813
  -849
  -885
  -922
  -959
  -998
  -1,037
Cash from investing activities, $m
  -26
  -39
  -55
  -75
  -101
  -132
  -167
  -208
  -253
  -303
  -358
  -414
  -475
  -539
  -605
  -672
  -741
  -811
  -883
  -956
  -1,030
  -1,105
  -1,182
  -1,260
  -1,341
  -1,423
  -1,508
  -1,595
  -1,686
  -1,779
Free cash flow, $m
  -38
  -54
  -74
  -97
  -123
  -151
  -179
  -205
  -227
  -244
  -253
  -252
  -240
  -216
  -177
  -124
  -56
  26
  124
  236
  362
  502
  654
  819
  995
  1,183
  1,381
  1,589
  1,807
  2,035
Issuance/(repayment) of debt, $m
  118
  172
  242
  330
  436
  561
  704
  865
  1,040
  1,228
  1,425
  1,629
  1,838
  2,047
  2,257
  2,464
  2,667
  2,866
  3,060
  3,250
  3,436
  3,618
  3,797
  3,974
  4,151
  4,329
  4,508
  4,690
  4,877
  5,069
Issuance/(repurchase) of shares, $m
  50
  70
  96
  125
  160
  197
  235
  273
  309
  340
  362
  376
  380
  371
  349
  311
  259
  192
  109
  11
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  168
  242
  338
  455
  596
  758
  939
  1,138
  1,349
  1,568
  1,787
  2,005
  2,218
  2,418
  2,606
  2,775
  2,926
  3,058
  3,169
  3,261
  3,436
  3,618
  3,797
  3,974
  4,151
  4,329
  4,508
  4,690
  4,877
  5,069
Total cash flow (excl. dividends), $m
  130
  189
  264
  358
  472
  607
  761
  934
  1,122
  1,324
  1,534
  1,753
  1,977
  2,203
  2,428
  2,651
  2,870
  3,084
  3,293
  3,497
  3,798
  4,119
  4,451
  4,793
  5,147
  5,512
  5,889
  6,280
  6,684
  7,104
Retained Cash Flow (-), $m
  -74
  -108
  -151
  -206
  -272
  -350
  -439
  -539
  -648
  -765
  -888
  -1,016
  -1,146
  -1,276
  -1,407
  -1,536
  -1,662
  -1,787
  -1,908
  -2,026
  -2,142
  -2,255
  -2,367
  -2,478
  -2,588
  -2,698
  -2,810
  -2,924
  -3,040
  -3,160
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
  57
  81
  113
  152
  200
  257
  322
  394
  474
  559
  645
  738
  832
  927
  1,022
  1,115
  1,207
  1,297
  1,385
  1,471
  1,656
  1,864
  2,084
  2,316
  2,559
  2,813
  3,079
  3,356
  3,644
  3,944
Discount rate, %
  9.00
  9.45
  9.92
  10.42
  10.94
  11.49
  12.06
  12.66
  13.30
  13.96
  14.66
  15.39
  16.16
  16.97
  17.82
  18.71
  19.65
  20.63
  21.66
  22.74
  23.88
  25.07
  26.33
  27.64
  29.03
  30.48
  32.00
  33.60
  35.28
  37.05
PV of cash for distribution, $m
  52
  68
  85
  102
  119
  134
  145
  152
  154
  151
  143
  132
  119
  103
  87
  72
  57
  44
  33
  24
  18
  14
  10
  7
  4
  3
  2
  1
  1
  0
Current shareholders' claim on cash, %
  63.4
  42.0
  29.0
  20.8
  15.5
  11.9
  9.4
  7.7
  6.4
  5.5
  4.8
  4.3
  3.9
  3.7
  3.4
  3.3
  3.2
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1
  3.1

Hudson Technologies, Inc. is a refrigerant services company. The Company's products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems, and include refrigerant and industrial gas sales, refrigerant management services consisting primarily of reclamation of refrigerants and RefrigerantSide Services performed at a customer's site, consisting of system decontamination to remove moisture, oils and other contaminants. In addition, the Company's SmartEnergy OPS service is a Web-based real time continuous monitoring service applicable to a facility's refrigeration systems and other energy systems. The Company's Chiller Chemistry and Chill Smart services are also predictive and diagnostic service offerings. The Company sells reclaimed and virgin (new) refrigerants to a variety of customers in various segments of the air conditioning and refrigeration industry, and sells industrial gases to a variety of industry segments.

FINANCIAL RATIOS  of  Hudson Technologies, Inc. (HDSN)

Valuation Ratios
P/E Ratio 4.2
Price to Sales 0.4
Price to Book 0.4
Price to Tangible Book
Price to Cash Flow 5.2
Price to Free Cash Flow 6.6
Growth Rates
Sales Growth Rate 31.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 100%
Cap. Spend. - 3 Yr. Gr. Rate 14.9%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 18
Management Effectiveness
Return On Assets 11.3%
Ret/ On Assets - 3 Yr. Avg. 6%
Return On Total Capital 11.8%
Ret/ On T. Cap. - 3 Yr. Avg. 5.9%
Return On Equity 13.7%
Return On Equity - 3 Yr. Avg. 7.2%
Asset Turnover 1
Profitability Ratios
Gross Margin 29.5%
Gross Margin - 3 Yr. Avg. 20.9%
EBITDA Margin 19%
EBITDA Margin - 3 Yr. Avg. 10.9%
Operating Margin 17.1%
Oper. Margin - 3 Yr. Avg. 8.5%
Pre-Tax Margin 16.2%
Pre-Tax Margin - 3 Yr. Avg. 7.5%
Net Profit Margin 10.5%
Net Profit Margin - 3 Yr. Avg. 5%
Effective Tax Rate 35.3%
Eff/ Tax Rate - 3 Yr. Avg. 40.9%
Payout Ratio 0%

HDSN stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the HDSN stock intrinsic value calculation we used $140 million for the last fiscal year's total revenue generated by Hudson Technologies, Inc.. The default revenue input number comes from 0001 income statement of Hudson Technologies, Inc.. 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 HDSN stock valuation model: a) initial revenue growth rate of 60% 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 9%, whose default value for HDSN is calculated based on our internal credit rating of Hudson Technologies, Inc., 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 Hudson Technologies, Inc..
    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 HDSN stock the variable cost ratio is equal to 82.1%.

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 HDSN 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 Hudson Technologies, Inc..

Corporate tax rate of 27% is the nominal tax rate for Hudson Technologies, Inc.. 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 HDSN 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 HDSN are equal to 28.9%.

Life of production assets of 18.4 years is the average useful life of capital assets used in Hudson Technologies, Inc. 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 HDSN is equal to 50%. 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 - $123.453 million for Hudson Technologies, Inc. - 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 42.602 million for Hudson Technologies, Inc. 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 Hudson Technologies, Inc. at the current share price and the inputted number of shares is $0.0 billion.

RELATED COMPANIES Price Int.Val. Rating
HDS HD Supply Hold 39.51 69.13  str.buy
LAWS Lawson Product 35.37 22.05  sell

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

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