Intrinsic value of John Bean Technologies Corporation - JBT

Previous Close

$105.52

  Intrinsic Value

$85.92

stock screener

  Rating & Target

hold

-19%

Previous close

$105.52

 
Intrinsic value

$85.92

 
Up/down potential

-19%

 
Rating

hold

We calculate the intrinsic value of JBT 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 3.3

 

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, %
  11.10
  10.49
  9.94
  9.45
  9.00
  8.60
  8.24
  7.92
  7.63
  7.36
  7.13
  6.91
  6.72
  6.55
  6.40
  6.26
  6.13
  6.02
  5.92
  5.82
  5.74
  5.67
  5.60
  5.54
  5.49
  5.44
  5.39
  5.35
  5.32
  5.29
Revenue, $m
  2,133
  2,357
  2,591
  2,836
  3,091
  3,357
  3,634
  3,922
  4,221
  4,531
  4,854
  5,190
  5,539
  5,902
  6,279
  6,672
  7,081
  7,507
  7,951
  8,414
  8,897
  9,402
  9,928
  10,478
  11,053
  11,654
  12,283
  12,941
  13,629
  14,350
Variable operating expenses, $m
  1,939
  2,137
  2,344
  2,561
  2,787
  3,022
  3,266
  3,521
  3,785
  4,060
  4,292
  4,589
  4,897
  5,218
  5,552
  5,899
  6,261
  6,637
  7,030
  7,439
  7,867
  8,312
  8,778
  9,264
  9,773
  10,304
  10,860
  11,441
  12,050
  12,687
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
  1,939
  2,137
  2,344
  2,561
  2,787
  3,022
  3,266
  3,521
  3,785
  4,060
  4,292
  4,589
  4,897
  5,218
  5,552
  5,899
  6,261
  6,637
  7,030
  7,439
  7,867
  8,312
  8,778
  9,264
  9,773
  10,304
  10,860
  11,441
  12,050
  12,687
Operating income, $m
  194
  220
  247
  275
  305
  335
  368
  401
  436
  472
  562
  601
  642
  684
  728
  773
  820
  870
  921
  975
  1,031
  1,089
  1,150
  1,214
  1,281
  1,350
  1,423
  1,499
  1,579
  1,663
EBITDA, $m
  289
  320
  351
  384
  419
  455
  493
  532
  572
  614
  658
  704
  751
  800
  851
  904
  960
  1,018
  1,078
  1,141
  1,206
  1,275
  1,346
  1,420
  1,498
  1,580
  1,665
  1,754
  1,848
  1,945
Interest expense (income), $m
  10
  21
  27
  33
  40
  46
  53
  61
  68
  76
  85
  93
  102
  112
  121
  131
  142
  153
  164
  176
  188
  201
  214
  228
  243
  258
  274
  291
  308
  326
  345
Earnings before tax, $m
  173
  193
  214
  236
  258
  282
  307
  332
  359
  387
  469
  499
  530
  563
  596
  631
  668
  706
  746
  787
  830
  875
  922
  971
  1,023
  1,076
  1,133
  1,191
  1,253
  1,317
Tax expense, $m
  47
  52
  58
  64
  70
  76
  83
  90
  97
  104
  127
  135
  143
  152
  161
  170
  180
  191
  201
  212
  224
  236
  249
  262
  276
  291
  306
  322
  338
  356
Net income, $m
  126
  141
  156
  172
  189
  206
  224
  243
  262
  282
  342
  364
  387
  411
  435
  461
  488
  515
  544
  574
  606
  639
  673
  709
  747
  786
  827
  870
  915
  962

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
  1,603
  1,771
  1,947
  2,131
  2,323
  2,522
  2,730
  2,946
  3,171
  3,405
  3,647
  3,899
  4,161
  4,434
  4,718
  5,013
  5,320
  5,640
  5,974
  6,322
  6,685
  7,064
  7,459
  7,873
  8,304
  8,756
  9,228
  9,723
  10,240
  10,781
Adjusted assets (=assets-cash), $m
  1,603
  1,771
  1,947
  2,131
  2,323
  2,522
  2,730
  2,946
  3,171
  3,405
  3,647
  3,899
  4,161
  4,434
  4,718
  5,013
  5,320
  5,640
  5,974
  6,322
  6,685
  7,064
  7,459
  7,873
  8,304
  8,756
  9,228
  9,723
  10,240
  10,781
Revenue / Adjusted assets
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
  1.331
Average production assets, $m
  555
  613
  674
  737
  804
  873
  945
  1,020
  1,097
  1,178
  1,262
  1,349
  1,440
  1,534
  1,633
  1,735
  1,841
  1,952
  2,067
  2,188
  2,313
  2,444
  2,581
  2,724
  2,874
  3,030
  3,194
  3,365
  3,544
  3,731
Working capital, $m
  100
  111
  122
  133
  145
  158
  171
  184
  198
  213
  228
  244
  260
  277
  295
  314
  333
  353
  374
  395
  418
  442
  467
  492
  520
  548
  577
  608
  641
  674
Total debt, $m
  497
  611
  732
  857
  988
  1,125
  1,267
  1,414
  1,568
  1,727
  1,893
  2,065
  2,244
  2,430
  2,624
  2,826
  3,036
  3,254
  3,482
  3,720
  3,968
  4,226
  4,497
  4,779
  5,074
  5,382
  5,705
  6,042
  6,396
  6,765
Total liabilities, $m
  1,095
  1,209
  1,330
  1,455
  1,586
  1,723
  1,865
  2,012
  2,166
  2,325
  2,491
  2,663
  2,842
  3,028
  3,222
  3,424
  3,634
  3,852
  4,080
  4,318
  4,566
  4,824
  5,095
  5,377
  5,672
  5,980
  6,303
  6,640
  6,994
  7,363
Total equity, $m
  508
  561
  617
  675
  736
  800
  865
  934
  1,005
  1,079
  1,156
  1,236
  1,319
  1,406
  1,495
  1,589
  1,686
  1,788
  1,894
  2,004
  2,119
  2,239
  2,365
  2,496
  2,633
  2,776
  2,925
  3,082
  3,246
  3,418
Total liabilities and equity, $m
  1,603
  1,770
  1,947
  2,130
  2,322
  2,523
  2,730
  2,946
  3,171
  3,404
  3,647
  3,899
  4,161
  4,434
  4,717
  5,013
  5,320
  5,640
  5,974
  6,322
  6,685
  7,063
  7,460
  7,873
  8,305
  8,756
  9,228
  9,722
  10,240
  10,781
Debt-to-equity ratio
  0.980
  1.090
  1.190
  1.270
  1.340
  1.410
  1.460
  1.510
  1.560
  1.600
  1.640
  1.670
  1.700
  1.730
  1.750
  1.780
  1.800
  1.820
  1.840
  1.860
  1.870
  1.890
  1.900
  1.910
  1.930
  1.940
  1.950
  1.960
  1.970
  1.980
Adjusted equity ratio
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317
  0.317

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  126
  141
  156
  172
  189
  206
  224
  243
  262
  282
  342
  364
  387
  411
  435
  461
  488
  515
  544
  574
  606
  639
  673
  709
  747
  786
  827
  870
  915
  962
Depreciation, amort., depletion, $m
  96
  100
  105
  109
  114
  120
  125
  131
  137
  143
  96
  102
  109
  116
  124
  131
  139
  148
  157
  166
  175
  185
  196
  206
  218
  230
  242
  255
  268
  283
Funds from operations, $m
  222
  241
  261
  281
  303
  326
  349
  373
  399
  425
  438
  467
  496
  527
  559
  592
  627
  663
  701
  740
  781
  824
  869
  915
  964
  1,015
  1,069
  1,125
  1,183
  1,244
Change in working capital, $m
  10
  11
  11
  12
  12
  12
  13
  14
  14
  15
  15
  16
  16
  17
  18
  18
  19
  20
  21
  22
  23
  24
  25
  26
  27
  28
  30
  31
  32
  34
Cash from operations, $m
  212
  230
  250
  270
  291
  313
  336
  360
  385
  411
  423
  451
  480
  510
  541
  574
  608
  643
  680
  718
  758
  800
  844
  890
  937
  987
  1,039
  1,094
  1,151
  1,210
Maintenance CAPEX, $m
  -38
  -42
  -46
  -51
  -56
  -61
  -66
  -72
  -77
  -83
  -89
  -96
  -102
  -109
  -116
  -124
  -131
  -139
  -148
  -157
  -166
  -175
  -185
  -196
  -206
  -218
  -230
  -242
  -255
  -268
New CAPEX, $m
  -55
  -58
  -61
  -64
  -66
  -69
  -72
  -75
  -78
  -81
  -84
  -87
  -91
  -94
  -98
  -102
  -106
  -111
  -115
  -120
  -126
  -131
  -137
  -143
  -149
  -156
  -163
  -171
  -179
  -187
Cash from investing activities, $m
  -93
  -100
  -107
  -115
  -122
  -130
  -138
  -147
  -155
  -164
  -173
  -183
  -193
  -203
  -214
  -226
  -237
  -250
  -263
  -277
  -292
  -306
  -322
  -339
  -355
  -374
  -393
  -413
  -434
  -455
Free cash flow, $m
  119
  130
  142
  155
  169
  183
  198
  214
  230
  247
  250
  268
  287
  306
  327
  348
  370
  393
  417
  441
  467
  494
  522
  551
  581
  613
  646
  681
  717
  755
Issuance/(repayment) of debt, $m
  109
  115
  120
  126
  131
  136
  142
  148
  153
  159
  166
  172
  179
  186
  194
  202
  210
  219
  228
  238
  248
  259
  270
  282
  295
  308
  323
  338
  353
  370
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  
  109
  115
  120
  126
  131
  136
  142
  148
  153
  159
  166
  172
  179
  186
  194
  202
  210
  219
  228
  238
  248
  259
  270
  282
  295
  308
  323
  338
  353
  370
Total cash flow (excl. dividends), $m
  228
  245
  262
  281
  300
  319
  340
  361
  383
  406
  415
  440
  466
  493
  521
  550
  580
  612
  645
  679
  715
  753
  792
  833
  876
  921
  969
  1,018
  1,070
  1,124
Retained Cash Flow (-), $m
  -51
  -53
  -56
  -58
  -61
  -63
  -66
  -69
  -71
  -74
  -77
  -80
  -83
  -86
  -90
  -94
  -97
  -101
  -106
  -110
  -115
  -120
  -125
  -131
  -137
  -143
  -150
  -157
  -164
  -172
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
  177
  191
  207
  222
  239
  256
  274
  293
  312
  332
  339
  360
  383
  406
  431
  456
  482
  510
  539
  569
  600
  633
  667
  702
  739
  778
  819
  862
  906
  953
Discount rate, %
  5.40
  5.67
  5.95
  6.25
  6.56
  6.89
  7.24
  7.60
  7.98
  8.38
  8.80
  9.24
  9.70
  10.18
  10.69
  11.23
  11.79
  12.38
  13.00
  13.65
  14.33
  15.04
  15.80
  16.59
  17.42
  18.29
  19.20
  20.16
  21.17
  22.23
PV of cash for distribution, $m
  168
  171
  174
  175
  174
  172
  168
  163
  156
  149
  134
  125
  115
  105
  94
  83
  73
  62
  53
  44
  36
  29
  23
  18
  13
  10
  7
  5
  3
  2
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

John Bean Technologies Corporation (JBT) is a technology solutions provider to the segments of the food and beverage industry with focus on proteins, liquid foods and automated system solutions. It operates through two segments: JBT FoodTech and JBT AeroTech. The JBT FoodTech segment designs, manufactures and services technologically food processing systems used for fruit juice production, frozen food production, in-container food production, automated systems and convenience food preparation by the food industry. The product offerings of its FoodTech businesses include Protein, Liquid Foods and Automated Systems. The JBT AeroTech segment designs, manufactures and services technologically airport ground support and gate equipment and provides services for airport authorities; airlines, airfreight, and ground handling companies; the defense contractors, and other industries. The product offerings of its AeroTech businesses include Mobile Equipment, Fixed Equipment and Airport Services.

FINANCIAL RATIOS  of  John Bean Technologies Corporation (JBT)

Valuation Ratios
P/E Ratio 45.2
Price to Sales 2.3
Price to Book 17.1
Price to Tangible Book
Price to Cash Flow 45.9
Price to Free Cash Flow 102.6
Growth Rates
Sales Growth Rate 22%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -2.6%
Cap. Spend. - 3 Yr. Gr. Rate 5%
Financial Strength
Quick Ratio 5
Current Ratio 0.1
LT Debt to Equity 273.3%
Total Debt to Equity 277.2%
Interest Coverage 10
Management Effectiveness
Return On Assets 7.3%
Ret/ On Assets - 3 Yr. Avg. 6.9%
Return On Total Capital 12.5%
Ret/ On T. Cap. - 3 Yr. Avg. 13.2%
Return On Equity 43.9%
Return On Equity - 3 Yr. Avg. 37.2%
Asset Turnover 1.3
Profitability Ratios
Gross Margin 28.2%
Gross Margin - 3 Yr. Avg. 27.8%
EBITDA Margin 10.5%
EBITDA Margin - 3 Yr. Avg. 9.8%
Operating Margin 7.7%
Oper. Margin - 3 Yr. Avg. 6.9%
Pre-Tax Margin 7%
Pre-Tax Margin - 3 Yr. Avg. 6.3%
Net Profit Margin 5%
Net Profit Margin - 3 Yr. Avg. 4.4%
Effective Tax Rate 27.7%
Eff/ Tax Rate - 3 Yr. Avg. 30.2%
Payout Ratio 17.6%

JBT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JBT stock intrinsic value calculation we used $1920 million for the last fiscal year's total revenue generated by John Bean Technologies Corporation. The default revenue input number comes from 0001 income statement of John Bean Technologies 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 JBT stock valuation model: a) initial revenue growth rate of 11.1% 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 5.4%, whose default value for JBT is calculated based on our internal credit rating of John Bean Technologies 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 John Bean Technologies 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 JBT stock the variable cost ratio is equal to 91.2%.

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 JBT 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 John Bean Technologies Corporation.

Corporate tax rate of 27% is the nominal tax rate for John Bean Technologies 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 JBT 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 JBT are equal to 26%.

Life of production assets of 13.2 years is the average useful life of capital assets used in John Bean Technologies 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 JBT is equal to 4.7%. 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 - $456.9 million for John Bean Technologies 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 31.500 million for John Bean Technologies 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 John Bean Technologies Corporation at the current share price and the inputted number of shares is $3.3 billion.

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