Intrinsic value of IRSA-Inversiones y Representaciones GDR - IRS

Previous Close

$13.17

  Intrinsic Value

$128.08

stock screener

  Rating & Target

str. buy

+873%

Previous close

$13.17

 
Intrinsic value

$128.08

 
Up/down potential

+873%

 
Rating

str. buy

Our model is not good at valuating stocks of financial companies, such as IRS.

We calculate the intrinsic value of IRS 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 0.5

 

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, %
  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
  7,140
  11,031
  16,496
  23,936
  33,770
  46,425
  62,317
  81,826
  105,290
  132,989
  165,143
  201,903
  243,361
  289,551
  340,461
  396,038
  456,202
  520,857
  589,898
  663,220
  740,729
  822,343
  908,000
  997,661
  1,091,313
  1,188,969
  1,290,668
  1,396,480
  1,506,501
  1,620,853
Variable operating expenses, $m
  6,452
  9,928
  14,811
  21,456
  30,241
  41,546
  55,742
  73,169
  94,130
  118,874
  147,522
  180,360
  217,394
  258,656
  304,133
  353,780
  407,525
  465,281
  526,955
  592,454
  661,693
  734,598
  811,116
  891,210
  974,870
  1,062,105
  1,152,954
  1,247,475
  1,345,757
  1,447,907
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
  6,452
  9,928
  14,811
  21,456
  30,241
  41,546
  55,742
  73,169
  94,130
  118,874
  147,522
  180,360
  217,394
  258,656
  304,133
  353,780
  407,525
  465,281
  526,955
  592,454
  661,693
  734,598
  811,116
  891,210
  974,870
  1,062,105
  1,152,954
  1,247,475
  1,345,757
  1,447,907
Operating income, $m
  687
  1,102
  1,686
  2,479
  3,529
  4,879
  6,575
  8,656
  11,160
  14,115
  17,621
  21,543
  25,967
  30,895
  36,327
  42,257
  48,677
  55,576
  62,942
  70,766
  79,036
  87,744
  96,884
  106,451
  116,444
  126,863
  137,715
  149,005
  160,744
  172,946
EBITDA, $m
  3,359
  5,190
  7,762
  11,262
  15,889
  21,843
  29,320
  38,499
  49,539
  62,572
  77,700
  94,995
  114,501
  136,234
  160,187
  186,336
  214,643
  245,063
  277,547
  312,045
  348,513
  386,913
  427,214
  469,400
  513,463
  559,410
  607,260
  657,045
  708,809
  762,612
Interest expense (income), $m
  364
  529
  950
  1,561
  2,420
  3,588
  5,133
  7,120
  9,616
  12,680
  16,366
  20,716
  25,766
  31,540
  38,051
  45,306
  53,302
  62,031
  71,481
  81,636
  92,479
  103,995
  116,169
  128,987
  142,441
  156,523
  171,233
  186,571
  202,544
  219,163
  236,443
Earnings before tax, $m
  158
  152
  124
  60
  -59
  -254
  -546
  -960
  -1,521
  -2,250
  -3,096
  -4,223
  -5,573
  -7,156
  -8,979
  -11,045
  -13,354
  -15,905
  -18,693
  -21,713
  -24,959
  -28,425
  -32,104
  -35,990
  -40,080
  -44,369
  -48,856
  -53,539
  -58,418
  -63,497
Tax expense, $m
  43
  41
  34
  16
  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
  115
  111
  91
  44
  -59
  -254
  -546
  -960
  -1,521
  -2,250
  -3,096
  -4,223
  -5,573
  -7,156
  -8,979
  -11,045
  -13,354
  -15,905
  -18,693
  -21,713
  -24,959
  -28,425
  -32,104
  -35,990
  -40,080
  -44,369
  -48,856
  -53,539
  -58,418
  -63,497

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
  21,061
  32,539
  48,662
  70,606
  99,615
  136,948
  183,825
  241,373
  310,589
  392,299
  487,146
  595,583
  717,878
  854,133
  1,004,309
  1,168,252
  1,345,729
  1,536,451
  1,740,111
  1,956,402
  2,185,041
  2,425,789
  2,678,466
  2,942,954
  3,219,213
  3,507,283
  3,807,281
  4,119,411
  4,443,955
  4,781,277
Adjusted assets (=assets-cash), $m
  21,061
  32,539
  48,662
  70,606
  99,615
  136,948
  183,825
  241,373
  310,589
  392,299
  487,146
  595,583
  717,878
  854,133
  1,004,309
  1,168,252
  1,345,729
  1,536,451
  1,740,111
  1,956,402
  2,185,041
  2,425,789
  2,678,466
  2,942,954
  3,219,213
  3,507,283
  3,807,281
  4,119,411
  4,443,955
  4,781,277
Revenue / Adjusted assets
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
  0.339
Average production assets, $m
  12,987
  20,065
  30,007
  43,539
  61,427
  84,448
  113,354
  148,841
  191,522
  241,908
  300,394
  367,261
  442,673
  526,694
  619,298
  720,392
  829,832
  947,439
  1,073,024
  1,206,397
  1,347,386
  1,495,841
  1,651,652
  1,814,746
  1,985,099
  2,162,734
  2,347,726
  2,540,198
  2,740,325
  2,948,331
Working capital, $m
  -14
  -22
  -33
  -48
  -68
  -93
  -125
  -164
  -211
  -266
  -330
  -404
  -487
  -579
  -681
  -792
  -912
  -1,042
  -1,180
  -1,326
  -1,481
  -1,645
  -1,816
  -1,995
  -2,183
  -2,378
  -2,581
  -2,793
  -3,013
  -3,242
Total debt, $m
  13,973
  22,960
  35,584
  52,767
  75,481
  104,712
  141,417
  186,477
  240,673
  304,652
  378,918
  463,823
  559,580
  666,268
  783,856
  912,223
  1,051,187
  1,200,523
  1,359,989
  1,529,344
  1,708,369
  1,896,875
  2,094,720
  2,301,815
  2,518,126
  2,743,684
  2,978,583
  3,222,981
  3,477,099
  3,741,222
Total liabilities, $m
  16,491
  25,478
  38,103
  55,285
  77,999
  107,231
  143,935
  188,995
  243,191
  307,170
  381,436
  466,342
  562,099
  668,786
  786,374
  914,742
  1,053,706
  1,203,042
  1,362,507
  1,531,862
  1,710,887
  1,899,393
  2,097,238
  2,304,333
  2,520,644
  2,746,202
  2,981,101
  3,225,499
  3,479,617
  3,743,740
Total equity, $m
  4,570
  7,061
  10,560
  15,322
  21,617
  29,718
  39,890
  52,378
  67,398
  85,129
  105,711
  129,242
  155,780
  185,347
  217,935
  253,511
  292,023
  333,410
  377,604
  424,539
  474,154
  526,396
  581,227
  638,621
  698,569
  761,080
  826,180
  893,912
  964,338
  1,037,537
Total liabilities and equity, $m
  21,061
  32,539
  48,663
  70,607
  99,616
  136,949
  183,825
  241,373
  310,589
  392,299
  487,147
  595,584
  717,879
  854,133
  1,004,309
  1,168,253
  1,345,729
  1,536,452
  1,740,111
  1,956,401
  2,185,041
  2,425,789
  2,678,465
  2,942,954
  3,219,213
  3,507,282
  3,807,281
  4,119,411
  4,443,955
  4,781,277
Debt-to-equity ratio
  3.060
  3.250
  3.370
  3.440
  3.490
  3.520
  3.550
  3.560
  3.570
  3.580
  3.580
  3.590
  3.590
  3.590
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.600
  3.610
  3.610
  3.610
  3.610
Adjusted equity ratio
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217
  0.217

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  115
  111
  91
  44
  -59
  -254
  -546
  -960
  -1,521
  -2,250
  -3,096
  -4,223
  -5,573
  -7,156
  -8,979
  -11,045
  -13,354
  -15,905
  -18,693
  -21,713
  -24,959
  -28,425
  -32,104
  -35,990
  -40,080
  -44,369
  -48,856
  -53,539
  -58,418
  -63,497
Depreciation, amort., depletion, $m
  2,672
  4,088
  6,076
  8,782
  12,360
  16,964
  22,745
  29,843
  38,379
  48,456
  60,079
  73,452
  88,535
  105,339
  123,860
  144,078
  165,966
  189,488
  214,605
  241,279
  269,477
  299,168
  330,330
  362,949
  397,020
  432,547
  469,545
  508,040
  548,065
  589,666
Funds from operations, $m
  2,787
  4,199
  6,167
  8,826
  12,300
  16,711
  22,200
  28,883
  36,858
  46,206
  56,983
  69,229
  82,961
  98,182
  114,881
  133,034
  152,612
  173,583
  195,912
  219,566
  244,518
  270,743
  298,227
  326,959
  356,940
  388,178
  420,689
  454,501
  489,647
  526,169
Change in working capital, $m
  -5
  -8
  -11
  -15
  -20
  -25
  -32
  -39
  -47
  -55
  -64
  -74
  -83
  -92
  -102
  -111
  -120
  -129
  -138
  -147
  -155
  -163
  -171
  -179
  -187
  -195
  -203
  -212
  -220
  -229
Cash from operations, $m
  2,793
  4,206
  6,178
  8,841
  12,320
  16,736
  22,231
  28,922
  36,905
  46,261
  57,048
  69,302
  83,044
  98,275
  114,982
  133,145
  152,732
  173,712
  196,050
  219,713
  244,673
  270,907
  298,398
  327,138
  357,127
  388,373
  420,893
  454,713
  489,867
  526,398
Maintenance CAPEX, $m
  -1,624
  -2,597
  -4,013
  -6,001
  -8,708
  -12,285
  -16,890
  -22,671
  -29,768
  -38,304
  -48,382
  -60,079
  -73,452
  -88,535
  -105,339
  -123,860
  -144,078
  -165,966
  -189,488
  -214,605
  -241,279
  -269,477
  -299,168
  -330,330
  -362,949
  -397,020
  -432,547
  -469,545
  -508,040
  -548,065
New CAPEX, $m
  -4,869
  -7,078
  -9,942
  -13,532
  -17,888
  -23,021
  -28,906
  -35,487
  -42,681
  -50,386
  -58,487
  -66,867
  -75,412
  -84,021
  -92,604
  -101,094
  -109,439
  -117,607
  -125,585
  -133,373
  -140,988
  -148,456
  -155,810
  -163,094
  -170,353
  -177,635
  -184,992
  -192,472
  -200,127
  -208,006
Cash from investing activities, $m
  -6,493
  -9,675
  -13,955
  -19,533
  -26,596
  -35,306
  -45,796
  -58,158
  -72,449
  -88,690
  -106,869
  -126,946
  -148,864
  -172,556
  -197,943
  -224,954
  -253,517
  -283,573
  -315,073
  -347,978
  -382,267
  -417,933
  -454,978
  -493,424
  -533,302
  -574,655
  -617,539
  -662,017
  -708,167
  -756,071
Free cash flow, $m
  -3,700
  -5,469
  -7,777
  -10,692
  -14,276
  -18,571
  -23,564
  -29,236
  -35,544
  -42,429
  -49,821
  -57,643
  -65,820
  -74,280
  -82,961
  -91,809
  -100,785
  -109,862
  -119,023
  -128,266
  -137,595
  -147,026
  -156,581
  -166,286
  -176,175
  -186,282
  -196,646
  -207,305
  -218,300
  -229,673
Issuance/(repayment) of debt, $m
  6,187
  8,987
  12,624
  17,182
  22,714
  29,232
  36,704
  45,061
  54,196
  63,979
  74,265
  84,906
  95,757
  106,688
  117,588
  128,368
  138,964
  149,336
  159,466
  169,355
  179,024
  188,506
  197,845
  207,094
  216,311
  225,558
  234,899
  244,398
  254,118
  264,123
Issuance/(repurchase) of shares, $m
  1,607
  2,380
  3,408
  4,718
  6,354
  8,355
  10,718
  13,448
  16,540
  19,981
  23,677
  27,754
  32,111
  36,724
  41,567
  46,621
  51,867
  57,292
  62,887
  68,648
  74,574
  80,667
  86,934
  93,384
  100,028
  106,880
  113,955
  121,271
  128,845
  136,696
Cash from financing (excl. dividends), $m  
  7,794
  11,367
  16,032
  21,900
  29,068
  37,587
  47,422
  58,509
  70,736
  83,960
  97,942
  112,660
  127,868
  143,412
  159,155
  174,989
  190,831
  206,628
  222,353
  238,003
  253,598
  269,173
  284,779
  300,478
  316,339
  332,438
  348,854
  365,669
  382,963
  400,819
Total cash flow (excl. dividends), $m
  4,093
  5,898
  8,255
  11,208
  14,793
  19,016
  23,858
  29,273
  35,192
  41,531
  48,122
  55,017
  62,048
  69,131
  76,194
  83,179
  90,045
  96,766
  103,330
  109,738
  116,004
  122,148
  128,199
  134,192
  140,165
  146,156
  152,209
  158,364
  164,662
  171,145
Retained Cash Flow (-), $m
  -1,722
  -2,491
  -3,499
  -4,762
  -6,354
  -8,355
  -10,718
  -13,448
  -16,540
  -19,981
  -23,677
  -27,754
  -32,111
  -36,724
  -41,567
  -46,621
  -51,867
  -57,292
  -62,887
  -68,648
  -74,574
  -80,667
  -86,934
  -93,384
  -100,028
  -106,880
  -113,955
  -121,271
  -128,845
  -136,696
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
  2,371
  3,407
  4,756
  6,446
  8,438
  10,661
  13,140
  15,825
  18,652
  21,550
  24,445
  27,263
  29,937
  32,408
  34,627
  36,559
  38,179
  39,474
  40,442
  41,090
  41,429
  41,480
  41,265
  40,808
  40,136
  39,276
  38,253
  37,093
  35,818
  34,449
Discount rate, %
  8.70
  9.14
  9.59
  10.07
  10.57
  11.10
  11.66
  12.24
  12.85
  13.50
  14.17
  14.88
  15.62
  16.41
  17.23
  18.09
  18.99
  19.94
  20.94
  21.98
  23.08
  24.24
  25.45
  26.72
  28.06
  29.46
  30.93
  32.48
  34.11
  35.81
PV of cash for distribution, $m
  2,181
  2,861
  3,613
  4,392
  5,105
  5,668
  6,072
  6,282
  6,282
  6,076
  5,689
  5,160
  4,535
  3,864
  3,192
  2,557
  1,986
  1,496
  1,092
  772
  529
  350
  224
  139
  83
  48
  26
  14
  7
  4
Current shareholders' claim on cash, %
  55.4
  31.7
  18.8
  11.5
  7.2
  4.6
  3.1
  2.1
  1.4
  1.0
  0.7
  0.5
  0.4
  0.3
  0.2
  0.2
  0.1
  0.1
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

IRSA Inversiones y Representaciones Sociedad Anonima is a holding company. The Company invests on its own behalf and through investee companies in companies operating in various sectors of the Israeli and global economy. The Company's segments are Cellcom, which includes cellular telephone services, content and added value services, other services and revenues from the sale of end user equipment in the cellular field; Property and Buildings and projects in Las Vegas, which includes the rental of income-generating properties and residential buildings; Shufersal, which includes retail and the rental of income-generating properties; Adama, which includes the sale of agro products and non-agro products; Clal Insurance Enterprise Holdings, which operates through subsidiary companies in the fields of insurance, pensions and provident funds, in the field of financial services and in the holding of assets and real businesses, and Others.

FINANCIAL RATIOS  of  IRSA-Inversiones y Representaciones GDR (IRS)

Valuation Ratios
P/E Ratio 39
Price to Sales 1.6
Price to Book 4.6
Price to Tangible Book
Price to Cash Flow 13.3
Price to Free Cash Flow 40.4
Growth Rates
Sales Growth Rate 135.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 192.4%
Cap. Spend. - 3 Yr. Gr. Rate 82.3%
Financial Strength
Quick Ratio 2
Current Ratio 0.1
LT Debt to Equity 423.4%
Total Debt to Equity 500.5%
Interest Coverage 2
Management Effectiveness
Return On Assets 2.6%
Ret/ On Assets - 3 Yr. Avg. 8%
Return On Total Capital 2.1%
Ret/ On T. Cap. - 3 Yr. Avg. 9.7%
Return On Equity 12.8%
Return On Equity - 3 Yr. Avg. 28.9%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 30.5%
Gross Margin - 3 Yr. Avg. 41.1%
EBITDA Margin 20.9%
EBITDA Margin - 3 Yr. Avg. 76.7%
Operating Margin 12.9%
Oper. Margin - 3 Yr. Avg. 79.3%
Pre-Tax Margin 6.9%
Pre-Tax Margin - 3 Yr. Avg. 60.7%
Net Profit Margin 4.1%
Net Profit Margin - 3 Yr. Avg. 34.9%
Effective Tax Rate 56.9%
Eff/ Tax Rate - 3 Yr. Avg. 45.1%
Payout Ratio 83%

IRS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the IRS stock intrinsic value calculation we used $4462.27890747 million for the last fiscal year's total revenue generated by IRSA-Inversiones y Representaciones GDR. The default revenue input number comes from 0001 income statement of IRSA-Inversiones y Representaciones GDR. 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 IRS 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 8.7%, whose default value for IRS is calculated based on our internal credit rating of IRSA-Inversiones y Representaciones GDR, 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 IRSA-Inversiones y Representaciones GDR.
    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 IRS stock the variable cost ratio is equal to 91%.

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 IRS 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 6.8% for IRSA-Inversiones y Representaciones GDR.

Corporate tax rate of 27% is the nominal tax rate for IRSA-Inversiones y Representaciones GDR. 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 IRS 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 IRS are equal to 181.9%.

Life of production assets of 0 years is the average useful life of capital assets used in IRSA-Inversiones y Representaciones GDR 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 IRS is equal to -0.2%. 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 - $2847.79208278 million for IRSA-Inversiones y Representaciones GDR - 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 35.202 million for IRSA-Inversiones y Representaciones GDR 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 IRSA-Inversiones y Representaciones GDR at the current share price and the inputted number of shares is $0.5 billion.

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COMPANY NEWS

▶ IRSA Inversiones: Fiscal 1Q Earnings Snapshot   [Nov-09-18 05:09AM  Associated Press]
▶ IRSA Inversiones: Fiscal 3Q Earnings Snapshot   [May-10-18 01:33PM  Associated Press]
▶ New Strong Buy Stocks for April 23rd   [Apr-23-18 11:18AM  Zacks]
▶ Top Ranked Income Stocks to Buy for March 1st   [Mar-01-18 09:10AM  Zacks]
▶ New Strong Buy Stocks for February 12th   [Feb-12-18 09:52AM  Zacks]
▶ IRSA Inversiones posts 2Q profit   [Feb-09-18 05:07PM  Associated Press]
▶ 5 Real Estate Companies Gurus Are Buying   [Aug-28-17 03:50PM  GuruFocus.com]
▶ IRSA Inversiones posts 2Q profit   [Feb-13-17 02:26PM  Associated Press]
▶ Clearwater Paper Corp (CLW) Hedge Funds Are Snapping Up   [Dec-09-16 01:22AM  Insider Monkey]
▶ Argentina: Tax Amnesty For $400B In Hidden Assets?   [Aug-18-16 05:21PM  at Barrons.com]

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