Intrinsic value of Interpace Diagnostics Group - IDXG

Previous Close

$1.46

  Intrinsic Value

$0.06

stock screener

  Rating & Target

str. sell

-96%

Previous close

$1.46

 
Intrinsic value

$0.06

 
Up/down potential

-96%

 
Rating

str. sell

We calculate the intrinsic value of IDXG 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, %
  42.70
  38.93
  35.54
  32.48
  29.73
  27.26
  25.04
  23.03
  21.23
  19.61
  18.15
  16.83
  15.65
  14.58
  13.62
  12.76
  11.99
  11.29
  10.66
  10.09
  9.58
  9.13
  8.71
  8.34
  8.01
  7.71
  7.44
  7.19
  6.97
  6.78
Revenue, $m
  23
  32
  43
  57
  73
  93
  117
  144
  174
  208
  246
  288
  333
  381
  433
  488
  547
  609
  674
  742
  813
  887
  964
  1,044
  1,128
  1,215
  1,305
  1,399
  1,497
  1,598
Variable operating expenses, $m
  52
  72
  96
  126
  162
  206
  256
  315
  381
  455
  534
  623
  721
  826
  938
  1,058
  1,185
  1,319
  1,459
  1,607
  1,761
  1,921
  2,089
  2,263
  2,444
  2,633
  2,828
  3,032
  3,243
  3,463
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
  52
  72
  96
  126
  162
  206
  256
  315
  381
  455
  534
  623
  721
  826
  938
  1,058
  1,185
  1,319
  1,459
  1,607
  1,761
  1,921
  2,089
  2,263
  2,444
  2,633
  2,828
  3,032
  3,243
  3,463
Operating income, $m
  -30
  -40
  -53
  -69
  -89
  -112
  -140
  -171
  -207
  -246
  -287
  -336
  -388
  -445
  -505
  -570
  -638
  -710
  -786
  -865
  -948
  -1,035
  -1,125
  -1,219
  -1,316
  -1,418
  -1,523
  -1,633
  -1,746
  -1,865
EBITDA, $m
  -24
  -33
  -45
  -59
  -77
  -98
  -122
  -151
  -183
  -219
  -258
  -302
  -349
  -400
  -454
  -512
  -573
  -638
  -706
  -778
  -852
  -930
  -1,011
  -1,095
  -1,183
  -1,274
  -1,369
  -1,467
  -1,569
  -1,676
Interest expense (income), $m
  0
  0
  1
  1
  3
  4
  5
  7
  10
  12
  15
  18
  22
  26
  30
  34
  39
  45
  50
  56
  62
  68
  75
  82
  89
  97
  105
  113
  122
  130
  140
Earnings before tax, $m
  -30
  -41
  -55
  -72
  -93
  -118
  -147
  -181
  -219
  -261
  -305
  -357
  -414
  -475
  -540
  -609
  -683
  -760
  -842
  -927
  -1,017
  -1,110
  -1,207
  -1,308
  -1,413
  -1,522
  -1,636
  -1,754
  -1,877
  -2,004
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
  -30
  -41
  -55
  -72
  -93
  -118
  -147
  -181
  -219
  -261
  -305
  -357
  -414
  -475
  -540
  -609
  -683
  -760
  -842
  -927
  -1,017
  -1,110
  -1,207
  -1,308
  -1,413
  -1,522
  -1,636
  -1,754
  -1,877
  -2,004

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
  66
  92
  124
  165
  213
  272
  340
  418
  507
  606
  716
  836
  967
  1,108
  1,259
  1,420
  1,590
  1,769
  1,958
  2,156
  2,362
  2,578
  2,802
  3,036
  3,279
  3,532
  3,795
  4,067
  4,351
  4,646
Adjusted assets (=assets-cash), $m
  66
  92
  124
  165
  213
  272
  340
  418
  507
  606
  716
  836
  967
  1,108
  1,259
  1,420
  1,590
  1,769
  1,958
  2,156
  2,362
  2,578
  2,802
  3,036
  3,279
  3,532
  3,795
  4,067
  4,351
  4,646
Revenue / Adjusted assets
  0.348
  0.348
  0.347
  0.345
  0.343
  0.342
  0.344
  0.344
  0.343
  0.343
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
  0.344
Average production assets, $m
  26
  36
  48
  64
  83
  106
  133
  163
  198
  237
  279
  327
  378
  433
  492
  554
  621
  691
  764
  842
  922
  1,006
  1,094
  1,185
  1,280
  1,379
  1,482
  1,588
  1,699
  1,814
Working capital, $m
  -5
  -7
  -9
  -12
  -16
  -20
  -25
  -31
  -38
  -45
  -54
  -63
  -73
  -83
  -94
  -106
  -119
  -133
  -147
  -162
  -177
  -193
  -210
  -228
  -246
  -265
  -285
  -305
  -326
  -348
Total debt, $m
  6
  13
  23
  35
  49
  66
  86
  110
  136
  165
  197
  233
  272
  313
  358
  405
  455
  508
  564
  622
  683
  747
  813
  882
  954
  1,028
  1,106
  1,186
  1,270
  1,357
Total liabilities, $m
  19
  27
  37
  49
  63
  80
  100
  123
  149
  179
  211
  247
  285
  327
  371
  419
  469
  522
  578
  636
  697
  760
  827
  896
  967
  1,042
  1,119
  1,200
  1,284
  1,371
Total equity, $m
  46
  65
  88
  116
  150
  191
  239
  295
  357
  427
  505
  590
  682
  781
  888
  1,001
  1,121
  1,247
  1,380
  1,520
  1,665
  1,817
  1,976
  2,140
  2,312
  2,490
  2,675
  2,868
  3,068
  3,275
Total liabilities and equity, $m
  65
  92
  125
  165
  213
  271
  339
  418
  506
  606
  716
  837
  967
  1,108
  1,259
  1,420
  1,590
  1,769
  1,958
  2,156
  2,362
  2,577
  2,803
  3,036
  3,279
  3,532
  3,794
  4,068
  4,352
  4,646
Debt-to-equity ratio
  0.120
  0.210
  0.260
  0.300
  0.330
  0.350
  0.360
  0.370
  0.380
  0.390
  0.390
  0.400
  0.400
  0.400
  0.400
  0.400
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
  0.410
Adjusted equity ratio
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705
  0.705

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -30
  -41
  -55
  -72
  -93
  -118
  -147
  -181
  -219
  -261
  -305
  -357
  -414
  -475
  -540
  -609
  -683
  -760
  -842
  -927
  -1,017
  -1,110
  -1,207
  -1,308
  -1,413
  -1,522
  -1,636
  -1,754
  -1,877
  -2,004
Depreciation, amort., depletion, $m
  6
  7
  8
  10
  12
  14
  17
  20
  24
  28
  29
  34
  39
  45
  51
  58
  65
  72
  80
  88
  96
  105
  114
  123
  133
  144
  154
  165
  177
  189
Funds from operations, $m
  -24
  -34
  -46
  -62
  -81
  -103
  -130
  -160
  -195
  -233
  -276
  -323
  -374
  -430
  -489
  -551
  -618
  -688
  -762
  -840
  -920
  -1,005
  -1,093
  -1,185
  -1,280
  -1,379
  -1,482
  -1,589
  -1,700
  -1,815
Change in working capital, $m
  -1
  -2
  -2
  -3
  -4
  -4
  -5
  -6
  -7
  -7
  -8
  -9
  -10
  -11
  -11
  -12
  -13
  -13
  -14
  -15
  -15
  -16
  -17
  -18
  -18
  -19
  -20
  -20
  -21
  -22
Cash from operations, $m
  -22
  -32
  -44
  -59
  -77
  -99
  -125
  -154
  -188
  -226
  -268
  -314
  -365
  -419
  -477
  -539
  -605
  -675
  -748
  -825
  -905
  -989
  -1,076
  -1,167
  -1,262
  -1,360
  -1,462
  -1,568
  -1,679
  -1,793
Maintenance CAPEX, $m
  -2
  -3
  -4
  -5
  -7
  -9
  -11
  -14
  -17
  -21
  -25
  -29
  -34
  -39
  -45
  -51
  -58
  -65
  -72
  -80
  -88
  -96
  -105
  -114
  -123
  -133
  -144
  -154
  -165
  -177
New CAPEX, $m
  -8
  -10
  -13
  -16
  -19
  -23
  -27
  -31
  -35
  -39
  -43
  -47
  -51
  -55
  -59
  -63
  -66
  -70
  -74
  -77
  -81
  -84
  -88
  -91
  -95
  -99
  -103
  -107
  -111
  -115
Cash from investing activities, $m
  -10
  -13
  -17
  -21
  -26
  -32
  -38
  -45
  -52
  -60
  -68
  -76
  -85
  -94
  -104
  -114
  -124
  -135
  -146
  -157
  -169
  -180
  -193
  -205
  -218
  -232
  -247
  -261
  -276
  -292
Free cash flow, $m
  -32
  -44
  -60
  -80
  -103
  -130
  -162
  -199
  -240
  -285
  -336
  -390
  -450
  -513
  -581
  -653
  -729
  -810
  -894
  -982
  -1,073
  -1,169
  -1,269
  -1,372
  -1,480
  -1,592
  -1,708
  -1,829
  -1,955
  -2,085
Issuance/(repayment) of debt, $m
  6
  8
  10
  12
  14
  17
  20
  23
  26
  29
  32
  36
  39
  42
  45
  47
  50
  53
  56
  58
  61
  64
  66
  69
  72
  75
  77
  81
  84
  87
Issuance/(repurchase) of shares, $m
  44
  59
  78
  100
  127
  159
  195
  236
  281
  331
  383
  442
  506
  574
  646
  722
  803
  887
  975
  1,067
  1,162
  1,262
  1,365
  1,473
  1,585
  1,701
  1,821
  1,947
  2,077
  2,212
Cash from financing (excl. dividends), $m  
  50
  67
  88
  112
  141
  176
  215
  259
  307
  360
  415
  478
  545
  616
  691
  769
  853
  940
  1,031
  1,125
  1,223
  1,326
  1,431
  1,542
  1,657
  1,776
  1,898
  2,028
  2,161
  2,299
Total cash flow (excl. dividends), $m
  18
  22
  27
  33
  39
  46
  53
  60
  68
  75
  80
  87
  95
  102
  109
  117
  123
  130
  137
  143
  150
  156
  163
  170
  176
  183
  190
  198
  206
  214
Retained Cash Flow (-), $m
  -44
  -59
  -78
  -100
  -127
  -159
  -195
  -236
  -281
  -331
  -383
  -442
  -506
  -574
  -646
  -722
  -803
  -887
  -975
  -1,067
  -1,162
  -1,262
  -1,365
  -1,473
  -1,585
  -1,701
  -1,821
  -1,947
  -2,077
  -2,212
Prev. year cash balance distribution, $m
  7
  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
  -19
  -37
  -51
  -68
  -89
  -113
  -142
  -176
  -214
  -256
  -303
  -355
  -411
  -472
  -537
  -606
  -679
  -757
  -838
  -923
  -1,012
  -1,105
  -1,202
  -1,303
  -1,408
  -1,517
  -1,631
  -1,749
  -1,871
  -1,998
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  -18
  -34
  -44
  -56
  -69
  -82
  -96
  -110
  -123
  -134
  -144
  -151
  -156
  -158
  -158
  -154
  -148
  -139
  -129
  -117
  -105
  -92
  -79
  -66
  -55
  -44
  -35
  -27
  -20
  -15
Current shareholders' claim on cash, %
  43.7
  19.7
  9.1
  4.3
  2.1
  1.0
  0.5
  0.3
  0.1
  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

Interpace Diagnostics Group, Inc., formerly PDI, Inc., is focused on developing and commercializing molecular diagnostic tests principally focused on early detection of high potential progressors to cancer and leveraging the latest technology and personalized medicine for patient diagnosis and management. The Company operates through molecular diagnostics segment. It offers molecular tests, such as PancraGen, which is a pancreatic cyst molecular test that can aid in pancreatic cyst diagnosis and pancreatic cancer risk assessment utilizing its PathFinder platform; ThyGenX, which assesses thyroid nodules for risk of malignancy, and ThyraMIR, which assesses thyroid nodules risk of malignancy utilizing a gene expression assay. Through its molecular diagnostics business, the Company provides diagnostic options for detecting genetic and other molecular alterations that are associated with gastrointestinal and endocrine cancers, which are focused on early detection of cancer.

FINANCIAL RATIOS  of  Interpace Diagnostics Group (IDXG)

Valuation Ratios
P/E Ratio -0.4
Price to Sales 0.2
Price to Book 0.5
Price to Tangible Book
Price to Cash Flow -0.4
Price to Free Cash Flow -0.4
Growth Rates
Sales Growth Rate 44.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate -100%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 114.3%
Total Debt to Equity 114.3%
Interest Coverage 0
Management Effectiveness
Return On Assets -14.5%
Ret/ On Assets - 3 Yr. Avg. -13.8%
Return On Total Capital -44.4%
Ret/ On T. Cap. - 3 Yr. Avg. -39.1%
Return On Equity -80%
Return On Equity - 3 Yr. Avg. -69.4%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 46.2%
Gross Margin - 3 Yr. Avg. 26.5%
EBITDA Margin -38.5%
EBITDA Margin - 3 Yr. Avg. -712.8%
Operating Margin -53.8%
Oper. Margin - 3 Yr. Avg. -769.8%
Pre-Tax Margin -69.2%
Pre-Tax Margin - 3 Yr. Avg. -819.4%
Net Profit Margin -61.5%
Net Profit Margin - 3 Yr. Avg. -594.6%
Effective Tax Rate 11.1%
Eff/ Tax Rate - 3 Yr. Avg. 24.1%
Payout Ratio 0%

IDXG stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the IDXG stock intrinsic value calculation we used $15.897 million for the last fiscal year's total revenue generated by Interpace Diagnostics Group. The default revenue input number comes from 0001 income statement of Interpace Diagnostics Group. 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 IDXG stock valuation model: a) initial revenue growth rate of 42.7% 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 4.3%, whose default value for IDXG is calculated based on our internal credit rating of Interpace Diagnostics Group, 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 Interpace Diagnostics Group.
    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 IDXG stock the variable cost ratio is equal to 237.5%.

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 IDXG 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 11% for Interpace Diagnostics Group.

Corporate tax rate of 27% is the nominal tax rate for Interpace Diagnostics Group. 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 IDXG 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 IDXG are equal to 113.5%.

Life of production assets of 9.6 years is the average useful life of capital assets used in Interpace Diagnostics Group 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 IDXG is equal to -21.8%. 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 - $39.869 million for Interpace Diagnostics Group - 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 28.194 million for Interpace Diagnostics Group 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 Interpace Diagnostics Group at the current share price and the inputted number of shares is $0.0 billion.

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COMPANY NEWS

▶ Interpace Diagnostics CEO Provides Corporate Update   [Oct-10-18 08:30AM  GlobeNewswire]
▶ Penny Stocks to Watch for September 2018   [Aug-31-18 02:44PM  Investopedia]
▶ Interpace Diagnostics Announces Launch of New Thyroid Test   [May-14-18 08:30AM  GlobeNewswire]
▶ Interpace Diagnostics Announces Appointment of New Director   [Sep-13-17 08:30AM  GlobeNewswire]
▶ Interpace Diagnostics Announces Cigna Coverage of ThyGenX®   [Jul-27-17 08:00AM  GlobeNewswire]

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