Intrinsic value of Juniper Pharmaceuticals - JNP

Previous Close

$11.50

  Intrinsic Value

$4.15

stock screener

  Rating & Target

str. sell

-64%

Previous close

$11.50

 
Intrinsic value

$4.15

 
Up/down potential

-64%

 
Rating

str. sell

We calculate the intrinsic value of JNP 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 2017), $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 0.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046
   2047

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
  51
  52
  54
  55
  57
  59
  61
  63
  65
  67
  70
  73
  76
  79
  83
  86
  90
  94
  98
  103
  108
  113
  118
  124
  130
  136
  142
  149
  156
  164
Variable operating expenses, $m
  46
  47
  48
  49
  51
  52
  54
  56
  58
  60
  62
  64
  67
  70
  73
  76
  79
  83
  87
  91
  95
  99
  104
  109
  114
  119
  125
  131
  138
  144
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
  46
  47
  48
  49
  51
  52
  54
  56
  58
  60
  62
  64
  67
  70
  73
  76
  79
  83
  87
  91
  95
  99
  104
  109
  114
  119
  125
  131
  138
  144
Operating income, $m
  5
  5
  5
  6
  6
  6
  6
  7
  7
  7
  8
  9
  9
  10
  10
  10
  11
  11
  12
  12
  13
  14
  14
  15
  16
  16
  17
  18
  19
  20
EBITDA, $m
  9
  9
  9
  9
  10
  10
  10
  11
  11
  11
  12
  12
  13
  13
  14
  14
  15
  16
  17
  17
  18
  19
  20
  21
  22
  23
  24
  25
  26
  28
Interest expense (income), $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
Earnings before tax, $m
  5
  5
  5
  5
  5
  6
  6
  6
  6
  7
  8
  8
  8
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  13
  14
  14
  15
  16
  17
  17
Tax expense, $m
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  4
  5
Net income, $m
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  6
  6
  6
  6
  7
  7
  7
  7
  8
  8
  8
  9
  9
  10
  10
  11
  11
  12
  12
  13

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
  57
  59
  60
  62
  64
  66
  68
  70
  73
  76
  79
  82
  85
  89
  93
  97
  101
  106
  111
  116
  121
  127
  133
  139
  145
  152
  160
  167
  176
  184
Adjusted assets (=assets-cash), $m
  57
  59
  60
  62
  64
  66
  68
  70
  73
  76
  79
  82
  85
  89
  93
  97
  101
  106
  111
  116
  121
  127
  133
  139
  145
  152
  160
  167
  176
  184
Revenue / Adjusted assets
  0.895
  0.881
  0.900
  0.887
  0.891
  0.894
  0.897
  0.900
  0.890
  0.882
  0.886
  0.890
  0.894
  0.888
  0.892
  0.887
  0.891
  0.887
  0.883
  0.888
  0.893
  0.890
  0.887
  0.892
  0.897
  0.895
  0.888
  0.892
  0.886
  0.891
Average production assets, $m
  24
  25
  26
  26
  27
  28
  29
  30
  31
  32
  34
  35
  36
  38
  40
  41
  43
  45
  47
  49
  52
  54
  56
  59
  62
  65
  68
  71
  75
  78
Working capital, $m
  2
  2
  2
  3
  3
  3
  3
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
  6
  7
  7
  7
  8
Total debt, $m
  4
  5
  5
  6
  6
  7
  8
  9
  9
  10
  11
  13
  14
  15
  16
  18
  19
  21
  22
  24
  26
  28
  30
  32
  34
  37
  39
  42
  44
  47
Total liabilities, $m
  20
  20
  20
  21
  22
  22
  23
  24
  25
  26
  27
  28
  29
  30
  32
  33
  34
  36
  38
  39
  41
  43
  45
  47
  50
  52
  54
  57
  60
  63
Total equity, $m
  38
  39
  40
  41
  42
  43
  45
  46
  48
  50
  52
  54
  56
  59
  61
  64
  67
  70
  73
  76
  80
  83
  87
  91
  96
  100
  105
  110
  116
  121
Total liabilities and equity, $m
  58
  59
  60
  62
  64
  65
  68
  70
  73
  76
  79
  82
  85
  89
  93
  97
  101
  106
  111
  115
  121
  126
  132
  138
  146
  152
  159
  167
  176
  184
Debt-to-equity ratio
  0.110
  0.120
  0.130
  0.140
  0.150
  0.160
  0.170
  0.180
  0.200
  0.210
  0.220
  0.230
  0.240
  0.250
  0.270
  0.280
  0.290
  0.300
  0.310
  0.320
  0.320
  0.330
  0.340
  0.350
  0.360
  0.360
  0.370
  0.380
  0.380
  0.390
Adjusted equity ratio
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659
  0.659

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  6
  6
  6
  6
  7
  7
  7
  7
  8
  8
  8
  9
  9
  10
  10
  11
  11
  12
  12
  13
Depreciation, amort., depletion, $m
  3
  3
  4
  4
  4
  4
  4
  4
  4
  4
  3
  3
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  6
  6
  6
  6
  7
  7
  7
  8
Funds from operations, $m
  7
  7
  7
  8
  8
  8
  8
  8
  9
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  13
  14
  14
  15
  16
  16
  17
  18
  19
  20
  20
Change in working capital, $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 operations, $m
  7
  7
  7
  7
  8
  8
  8
  8
  9
  9
  9
  9
  10
  10
  10
  11
  11
  12
  12
  13
  13
  14
  15
  15
  16
  17
  18
  18
  19
  20
Maintenance CAPEX, $m
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -6
  -7
  -7
  -7
New CAPEX, $m
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
Cash from investing activities, $m
  -2
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -4
  -6
  -6
  -6
  -6
  -6
  -7
  -7
  -7
  -7
  -8
  -9
  -9
  -9
  -9
  -10
  -10
  -11
Free cash flow, $m
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  4
  5
  5
  5
  5
  5
  5
  6
  6
  6
  6
  6
  7
  7
  7
  8
  8
  8
  9
  9
Issuance/(repayment) of debt, $m
  1
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
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  
  1
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
Total cash flow (excl. dividends), $m
  5
  5
  5
  5
  5
  5
  5
  5
  5
  6
  5
  6
  6
  6
  6
  7
  7
  7
  7
  8
  8
  8
  9
  9
  10
  10
  10
  11
  11
  12
Retained Cash Flow (-), $m
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -6
Prev. year cash balance distribution, $m
  5
  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
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  3
  3
  4
  4
  4
  4
  4
  5
Cash available for distribution, $m
  9
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  4
  5
  5
  5
  5
  5
  5
  6
  6
  6
  6
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
  9
  3
  3
  3
  3
  3
  2
  2
  2
  2
  2
  2
  1
  1
  1
  1
  1
  1
  1
  1
  0
  0
  0
  0
  0
  0
  0
  0
  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

Juniper Pharmaceuticals, Inc. is a women’s health therapeutics company. The Company is focused on developing therapeutics that address unmet medical needs in women’s health. It operates in two segments: product and service. The product segment is engaged in manufacturing and supplying CRINONE, the Company’s commercialized product. The service segment includes product development, clinical trial manufacturing, and advanced analytical and consulting services, as well as characterizing and developing its pharmaceutical product candidates. The Company’s pipeline of proprietary products includes JNP-0101, JNP-0201 and JNP-0301. JNP-0101 is developed to deliver oxybutynin for the treatment of overactive bladder in women. JNP-0201 is being designed to deliver natural hormones locally to vaginal tissue. JNP-0301 is being developed for the prevention of pre-term birth in women with a short cervical length. CRINONE is developed as a progesterone gel.

FINANCIAL RATIOS  of  Juniper Pharmaceuticals (JNP)

Valuation Ratios
P/E Ratio 20.8
Price to Sales 2.3
Price to Book 3.1
Price to Tangible Book
Price to Cash Flow 11.3
Price to Free Cash Flow 17.8
Growth Rates
Sales Growth Rate 44.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 100%
Cap. Spend. - 3 Yr. Gr. Rate 32%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 5%
Total Debt to Equity 5%
Interest Coverage 0
Management Effectiveness
Return On Assets 11%
Ret/ On Assets - 3 Yr. Avg. 5.4%
Return On Total Capital 14.6%
Ret/ On T. Cap. - 3 Yr. Avg. 6.8%
Return On Equity 15.6%
Return On Equity - 3 Yr. Avg. 7.3%
Asset Turnover 1
Profitability Ratios
Gross Margin 54.5%
Gross Margin - 3 Yr. Avg. 49.3%
EBITDA Margin 14.5%
EBITDA Margin - 3 Yr. Avg. 12.8%
Operating Margin 10.9%
Oper. Margin - 3 Yr. Avg. 5.9%
Pre-Tax Margin 10.9%
Pre-Tax Margin - 3 Yr. Avg. 7.8%
Net Profit Margin 10.9%
Net Profit Margin - 3 Yr. Avg. 6.9%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. -33.3%
Payout Ratio 0%

JNP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JNP stock intrinsic value calculation we used $50 million for the last fiscal year's total revenue generated by Juniper Pharmaceuticals. The default revenue input number comes from 2017 income statement of Juniper Pharmaceuticals. 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 JNP 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 4.3%, whose default value for JNP is calculated based on our internal credit rating of Juniper Pharmaceuticals, 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 Juniper Pharmaceuticals.
    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 JNP stock the variable cost ratio is equal to 90%.

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 JNP 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 Juniper Pharmaceuticals.

Corporate tax rate of 27% is the nominal tax rate for Juniper Pharmaceuticals. 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 JNP stock is equal to 2.9%.

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 JNP are equal to 47.8%.

Life of production assets of 10 years is the average useful life of capital assets used in Juniper Pharmaceuticals 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 JNP is equal to 4.6%. 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 - $42 million for Juniper Pharmaceuticals - 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 11 million for Juniper Pharmaceuticals 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 Juniper Pharmaceuticals at the current share price and the inputted number of shares is $0.1 billion.

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COMPANY NEWS

▶ Juniper Pharmaceuticals: 2Q Earnings Snapshot   [09:09AM  Associated Press]
▶ WeissLaw LLP Investigates Juniper Pharmaceuticals, Inc.   [Jul-05-18 04:33PM  PR Newswire]
▶ Catalent to acquire Boston's Juniper Pharmaceuticals for $128M   [Jul-03-18 11:07AM  American City Business Journals]
▶ Juniper Pharmaceuticals: 1Q Earnings Snapshot   [May-10-18 07:39AM  Associated Press]
▶ At $12, Is Juniper Pharmaceuticals Inc (NASDAQ:JNP) A Buy?   [Mar-20-18 12:06PM  Simply Wall St.]
▶ Juniper Pharmaceuticals posts 4Q profit   [Mar-08-18 09:49AM  Associated Press]
▶ Flavor Of The Month: Net 1 UEPS Technologies And More   [Nov-04-17 09:02AM  Simply Wall St.]
▶ Juniper Pharmaceuticals posts 2Q loss   [Aug-04-17 12:12AM  Associated Press]
▶ Juniper Pharmaceuticals posts 1Q loss   [May-04-17 08:53AM  Associated Press]
▶ Juniper Pharmaceuticals posts 4Q profit   [06:14AM  Associated Press]
▶ Hedge Funds Are Crazy About Avinger Inc (AVGR)   [Dec-15-16 06:23AM  at Insider Monkey]
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