Intrinsic value of Integer Holdings Corporation - ITGR

Previous Close

$73.81

  Intrinsic Value

$52.56

stock screener

  Rating & Target

sell

-29%

Previous close

$73.81

 
Intrinsic value

$52.56

 
Up/down potential

-29%

 
Rating

sell

We calculate the intrinsic value of ITGR 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 2.4

 

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, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  1,239
  1,268
  1,300
  1,337
  1,377
  1,422
  1,470
  1,523
  1,579
  1,640
  1,705
  1,774
  1,848
  1,926
  2,009
  2,097
  2,190
  2,289
  2,393
  2,503
  2,619
  2,741
  2,870
  3,006
  3,149
  3,300
  3,458
  3,625
  3,801
  3,986
Variable operating expenses, $m
  766
  780
  796
  814
  833
  855
  879
  904
  931
  961
  828
  861
  897
  935
  976
  1,018
  1,064
  1,111
  1,162
  1,215
  1,272
  1,331
  1,394
  1,460
  1,529
  1,602
  1,679
  1,760
  1,846
  1,935
Fixed operating expenses, $m
  318
  325
  332
  339
  347
  354
  362
  370
  378
  387
  395
  404
  413
  422
  431
  441
  450
  460
  470
  481
  491
  502
  513
  524
  536
  548
  560
  572
  585
  597
Total operating expenses, $m
  1,084
  1,105
  1,128
  1,153
  1,180
  1,209
  1,241
  1,274
  1,309
  1,348
  1,223
  1,265
  1,310
  1,357
  1,407
  1,459
  1,514
  1,571
  1,632
  1,696
  1,763
  1,833
  1,907
  1,984
  2,065
  2,150
  2,239
  2,332
  2,431
  2,532
Operating income, $m
  155
  163
  172
  184
  197
  213
  230
  249
  270
  292
  482
  509
  538
  569
  602
  638
  676
  717
  761
  807
  856
  908
  963
  1,022
  1,084
  1,150
  1,219
  1,293
  1,371
  1,453
EBITDA, $m
  371
  380
  390
  403
  419
  436
  455
  476
  499
  524
  552
  582
  614
  648
  685
  724
  767
  811
  859
  910
  964
  1,021
  1,082
  1,146
  1,214
  1,286
  1,362
  1,442
  1,527
  1,617
Interest expense (income), $m
  0
  72
  74
  76
  79
  82
  85
  89
  93
  97
  102
  107
  112
  118
  124
  130
  137
  144
  151
  159
  168
  177
  186
  196
  207
  218
  229
  242
  255
  268
  282
Earnings before tax, $m
  83
  89
  96
  105
  115
  127
  141
  156
  172
  191
  375
  397
  420
  445
  472
  501
  533
  566
  601
  639
  679
  722
  767
  815
  866
  920
  978
  1,038
  1,102
  1,170
Tax expense, $m
  22
  24
  26
  28
  31
  34
  38
  42
  47
  51
  101
  107
  113
  120
  128
  135
  144
  153
  162
  173
  183
  195
  207
  220
  234
  248
  264
  280
  298
  316
Net income, $m
  61
  65
  70
  77
  84
  93
  103
  114
  126
  139
  274
  290
  307
  325
  345
  366
  389
  413
  439
  466
  496
  527
  560
  595
  632
  672
  714
  758
  805
  854

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
  2,374
  2,429
  2,491
  2,561
  2,639
  2,724
  2,817
  2,917
  3,025
  3,142
  3,266
  3,398
  3,539
  3,689
  3,849
  4,017
  4,196
  4,385
  4,584
  4,795
  5,017
  5,251
  5,498
  5,759
  6,033
  6,321
  6,625
  6,945
  7,281
  7,635
Adjusted assets (=assets-cash), $m
  2,374
  2,429
  2,491
  2,561
  2,639
  2,724
  2,817
  2,917
  3,025
  3,142
  3,266
  3,398
  3,539
  3,689
  3,849
  4,017
  4,196
  4,385
  4,584
  4,795
  5,017
  5,251
  5,498
  5,759
  6,033
  6,321
  6,625
  6,945
  7,281
  7,635
Revenue / Adjusted assets
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
  0.522
Average production assets, $m
  1,092
  1,117
  1,146
  1,178
  1,214
  1,253
  1,295
  1,342
  1,391
  1,445
  1,502
  1,563
  1,628
  1,697
  1,770
  1,847
  1,930
  2,016
  2,108
  2,205
  2,307
  2,415
  2,529
  2,648
  2,774
  2,907
  3,047
  3,194
  3,349
  3,511
Working capital, $m
  269
  275
  282
  290
  299
  309
  319
  330
  343
  356
  370
  385
  401
  418
  436
  455
  475
  497
  519
  543
  568
  595
  623
  652
  683
  716
  750
  787
  825
  865
Total debt, $m
  951
  981
  1,015
  1,053
  1,095
  1,141
  1,192
  1,246
  1,305
  1,368
  1,436
  1,508
  1,585
  1,666
  1,753
  1,845
  1,942
  2,045
  2,153
  2,268
  2,389
  2,516
  2,650
  2,792
  2,941
  3,098
  3,263
  3,437
  3,620
  3,813
Total liabilities, $m
  1,292
  1,321
  1,355
  1,393
  1,436
  1,482
  1,532
  1,587
  1,646
  1,709
  1,777
  1,849
  1,925
  2,007
  2,094
  2,185
  2,283
  2,385
  2,494
  2,608
  2,729
  2,857
  2,991
  3,133
  3,282
  3,439
  3,604
  3,778
  3,961
  4,154
Total equity, $m
  1,083
  1,108
  1,136
  1,168
  1,203
  1,242
  1,284
  1,330
  1,380
  1,433
  1,489
  1,550
  1,614
  1,682
  1,755
  1,832
  1,913
  1,999
  2,090
  2,186
  2,288
  2,395
  2,507
  2,626
  2,751
  2,883
  3,021
  3,167
  3,320
  3,482
Total liabilities and equity, $m
  2,375
  2,429
  2,491
  2,561
  2,639
  2,724
  2,816
  2,917
  3,026
  3,142
  3,266
  3,399
  3,539
  3,689
  3,849
  4,017
  4,196
  4,384
  4,584
  4,794
  5,017
  5,252
  5,498
  5,759
  6,033
  6,322
  6,625
  6,945
  7,281
  7,636
Debt-to-equity ratio
  0.880
  0.890
  0.890
  0.900
  0.910
  0.920
  0.930
  0.940
  0.950
  0.960
  0.960
  0.970
  0.980
  0.990
  1.000
  1.010
  1.010
  1.020
  1.030
  1.040
  1.040
  1.050
  1.060
  1.060
  1.070
  1.070
  1.080
  1.090
  1.090
  1.100
Adjusted equity ratio
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  61
  65
  70
  77
  84
  93
  103
  114
  126
  139
  274
  290
  307
  325
  345
  366
  389
  413
  439
  466
  496
  527
  560
  595
  632
  672
  714
  758
  805
  854
Depreciation, amort., depletion, $m
  216
  217
  218
  220
  221
  223
  225
  227
  230
  232
  70
  73
  76
  79
  83
  86
  90
  94
  99
  103
  108
  113
  118
  124
  130
  136
  142
  149
  156
  164
Funds from operations, $m
  276
  281
  288
  296
  305
  316
  328
  341
  355
  371
  344
  363
  383
  404
  428
  452
  479
  507
  537
  569
  604
  640
  678
  719
  762
  808
  856
  907
  961
  1,018
Change in working capital, $m
  5
  6
  7
  8
  9
  10
  11
  11
  12
  13
  14
  15
  16
  17
  18
  19
  20
  21
  23
  24
  25
  27
  28
  29
  31
  33
  34
  36
  38
  40
Cash from operations, $m
  271
  275
  281
  288
  297
  306
  317
  330
  343
  358
  330
  348
  367
  387
  410
  433
  459
  486
  515
  546
  578
  613
  650
  689
  731
  775
  822
  871
  923
  978
Maintenance CAPEX, $m
  -50
  -51
  -52
  -54
  -55
  -57
  -59
  -61
  -63
  -65
  -68
  -70
  -73
  -76
  -79
  -83
  -86
  -90
  -94
  -99
  -103
  -108
  -113
  -118
  -124
  -130
  -136
  -142
  -149
  -156
New CAPEX, $m
  -22
  -25
  -29
  -32
  -36
  -39
  -43
  -46
  -50
  -53
  -57
  -61
  -65
  -69
  -73
  -78
  -82
  -87
  -92
  -97
  -102
  -108
  -114
  -120
  -126
  -133
  -140
  -147
  -155
  -163
Cash from investing activities, $m
  -72
  -76
  -81
  -86
  -91
  -96
  -102
  -107
  -113
  -118
  -125
  -131
  -138
  -145
  -152
  -161
  -168
  -177
  -186
  -196
  -205
  -216
  -227
  -238
  -250
  -263
  -276
  -289
  -304
  -319
Free cash flow, $m
  199
  199
  200
  202
  206
  210
  216
  223
  231
  240
  205
  216
  229
  242
  257
  273
  290
  309
  329
  350
  373
  398
  424
  452
  481
  513
  546
  582
  619
  659
Issuance/(repayment) of debt, $m
  25
  30
  34
  38
  42
  46
  50
  55
  59
  63
  68
  72
  77
  82
  87
  92
  97
  103
  109
  115
  121
  128
  134
  142
  149
  157
  165
  174
  183
  192
Issuance/(repurchase) of shares, $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 from financing (excl. dividends), $m  
  25
  30
  34
  38
  42
  46
  50
  55
  59
  63
  68
  72
  77
  82
  87
  92
  97
  103
  109
  115
  121
  128
  134
  142
  149
  157
  165
  174
  183
  192
Total cash flow (excl. dividends), $m
  224
  229
  234
  240
  248
  257
  266
  277
  290
  303
  273
  289
  306
  324
  344
  365
  387
  412
  437
  465
  494
  525
  558
  593
  630
  670
  711
  755
  802
  852
Retained Cash Flow (-), $m
  -22
  -25
  -28
  -32
  -35
  -39
  -42
  -46
  -49
  -53
  -57
  -60
  -64
  -68
  -73
  -77
  -81
  -86
  -91
  -96
  -101
  -107
  -113
  -119
  -125
  -132
  -139
  -146
  -153
  -161
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
  202
  204
  206
  209
  213
  218
  224
  232
  240
  250
  216
  228
  241
  256
  271
  288
  306
  325
  346
  369
  393
  418
  445
  474
  505
  538
  573
  610
  649
  690
Discount rate, %
  7.40
  7.77
  8.16
  8.57
  8.99
  9.44
  9.92
  10.41
  10.93
  11.48
  12.05
  12.66
  13.29
  13.95
  14.65
  15.38
  16.15
  16.96
  17.81
  18.70
  19.63
  20.62
  21.65
  22.73
  23.87
  25.06
  26.31
  27.63
  29.01
  30.46
PV of cash for distribution, $m
  188
  176
  162
  150
  138
  127
  116
  105
  94
  84
  62
  55
  48
  41
  35
  29
  24
  19
  15
  12
  9
  7
  5
  3
  2
  2
  1
  1
  0
  0
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Integer Holdings Corporation operates as a medical device outsource manufacturer worldwide. It operates through three segments: Greatbatch Medical, QiG Group, and Lake Region Medical. The company offers cardiac and neuromodulation products, including batteries, capacitors, filtered and unfiltered feedthroughs, engineered components, implantable stimulation leads, and enclosures used in implantable medical devices; and hip and shoulder joint reconstruction implants, plates, screws, spinal devices, and instruments and delivery systems used in hip and knee replacement, trauma fixation, extremity, and spine surgeries. It also provides vascular products, such as off-the-shelf introducers, steerable sheaths, and components for catheters that deliver minimally invasive therapies for coronary and neurovascular disease, peripheral vascular disease, interventional radiology and cardiology, vascular access, and atrial fibrillation; and products for medical imaging and drug and pharmaceutical delivery. In addition, the company offers customized battery power and management systems, charging and docking stations, and power supplies; non-rechargeable and rechargeable battery solutions for the portable medical, energy, military, and environmental markets; and rechargeable battery packs. Further, it provides implantable pulse generators, programmer systems, battery chargers, and patient wands and leads; neural interface technology, components, and systems; and interventional and diagnostic wire-formed medical devices and components for cardiovascular, endovascular, and neurovascular applications. It serves multi-national original equipment manufacturers, numerous scientists, hospitals, and universities, as well as research companies and institutes, and early stage medical device companies. The company was formerly known as Greatbatch, Inc. and changed its name to Integer Holdings Corporation in July 2016. The company was founded in 1970 and is headquartered in Frisco, Texas.

FINANCIAL RATIOS  of  Integer Holdings Corporation (ITGR)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate -100%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets 0%
Ret/ On Assets - 3 Yr. Avg. 0%
Return On Total Capital 0%
Ret/ On T. Cap. - 3 Yr. Avg. 0%
Return On Equity 0%
Return On Equity - 3 Yr. Avg. 0%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 0%
Operating Margin 0%
Oper. Margin - 3 Yr. Avg. 0%
Pre-Tax Margin 0%
Pre-Tax Margin - 3 Yr. Avg. 0%
Net Profit Margin 0%
Net Profit Margin - 3 Yr. Avg. 0%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ITGR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ITGR stock intrinsic value calculation we used $1215 million for the last fiscal year's total revenue generated by Integer Holdings Corporation. The default revenue input number comes from 0001 income statement of Integer Holdings Corporation. 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 ITGR stock valuation model: a) initial revenue growth rate of 2% 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 7.4%, whose default value for ITGR is calculated based on our internal credit rating of Integer Holdings Corporation, 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 Integer Holdings Corporation.
    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 ITGR stock the variable cost ratio is equal to 62.1%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $311 million in the base year in the intrinsic value calculation for ITGR 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 7.8% for Integer Holdings Corporation.

Corporate tax rate of 27% is the nominal tax rate for Integer Holdings Corporation. 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 ITGR 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 ITGR are equal to 88.1%.

Life of production assets of 21.4 years is the average useful life of capital assets used in Integer Holdings Corporation 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 ITGR is equal to 21.7%. 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 - $1060.493 million for Integer Holdings Corporation - 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 32.563 million for Integer Holdings Corporation 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 Integer Holdings Corporation at the current share price and the inputted number of shares is $2.4 billion.

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