Intrinsic value of Las Vegas Sands - LVS

Previous Close

$53.73

  Intrinsic Value

$57.25

stock screener

  Rating & Target

hold

+7%

Previous close

$53.73

 
Intrinsic value

$57.25

 
Up/down potential

+7%

 
Rating

hold

We calculate the intrinsic value of LVS 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 42.3

 

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, %
  6.20
  6.08
  5.97
  5.87
  5.79
  5.71
  5.64
  5.57
  5.52
  5.46
  5.42
  5.38
  5.34
  5.31
  5.27
  5.25
  5.22
  5.20
  5.18
  5.16
  5.15
  5.13
  5.12
  5.11
  5.10
  5.09
  5.08
  5.07
  5.06
  5.06
Revenue, $m
  13,681
  14,512
  15,379
  16,283
  17,225
  18,208
  19,235
  20,307
  21,427
  22,598
  23,823
  25,103
  26,444
  27,847
  29,315
  30,854
  32,465
  34,153
  35,922
  37,777
  39,720
  41,759
  43,896
  46,137
  48,488
  50,955
  53,542
  56,256
  59,105
  62,093
Variable operating expenses, $m
  4,678
  4,962
  5,258
  5,566
  5,888
  6,224
  6,574
  6,940
  7,322
  7,722
  8,131
  8,568
  9,025
  9,504
  10,006
  10,531
  11,081
  11,657
  12,261
  12,893
  13,557
  14,253
  14,982
  15,747
  16,550
  17,391
  18,274
  19,201
  20,173
  21,193
Fixed operating expenses, $m
  5,241
  5,356
  5,474
  5,594
  5,717
  5,843
  5,972
  6,103
  6,237
  6,375
  6,515
  6,658
  6,805
  6,954
  7,107
  7,264
  7,424
  7,587
  7,754
  7,924
  8,099
  8,277
  8,459
  8,645
  8,835
  9,030
  9,228
  9,431
  9,639
  9,851
Total operating expenses, $m
  9,919
  10,318
  10,732
  11,160
  11,605
  12,067
  12,546
  13,043
  13,559
  14,097
  14,646
  15,226
  15,830
  16,458
  17,113
  17,795
  18,505
  19,244
  20,015
  20,817
  21,656
  22,530
  23,441
  24,392
  25,385
  26,421
  27,502
  28,632
  29,812
  31,044
Operating income, $m
  3,762
  4,194
  4,647
  5,122
  5,620
  6,141
  6,689
  7,264
  7,868
  8,502
  9,177
  9,877
  10,614
  11,388
  12,202
  13,059
  13,961
  14,909
  15,908
  16,959
  18,065
  19,229
  20,455
  21,745
  23,104
  24,534
  26,039
  27,624
  29,293
  31,049
EBITDA, $m
  5,014
  5,522
  6,054
  6,611
  7,194
  7,805
  8,446
  9,119
  9,824
  10,565
  11,342
  12,159
  13,017
  13,919
  14,867
  15,864
  16,912
  18,014
  19,173
  20,392
  21,675
  23,025
  24,445
  25,939
  27,511
  29,165
  30,906
  32,738
  34,665
  36,693
Interest expense (income), $m
  214
  521
  567
  617
  668
  722
  778
  836
  897
  961
  1,028
  1,097
  1,170
  1,246
  1,326
  1,409
  1,497
  1,588
  1,684
  1,784
  1,890
  2,000
  2,116
  2,237
  2,364
  2,497
  2,637
  2,784
  2,937
  3,099
  3,268
Earnings before tax, $m
  3,241
  3,627
  4,031
  4,454
  4,898
  5,364
  5,853
  6,367
  6,906
  7,474
  8,079
  8,707
  9,367
  10,062
  10,793
  11,562
  12,372
  13,225
  14,123
  15,069
  16,065
  17,114
  18,218
  19,381
  20,607
  21,897
  23,256
  24,687
  26,194
  27,781
Tax expense, $m
  875
  979
  1,088
  1,203
  1,322
  1,448
  1,580
  1,719
  1,865
  2,018
  2,181
  2,351
  2,529
  2,717
  2,914
  3,122
  3,341
  3,571
  3,813
  4,069
  4,338
  4,621
  4,919
  5,233
  5,564
  5,912
  6,279
  6,665
  7,072
  7,501
Net income, $m
  2,366
  2,648
  2,942
  3,251
  3,575
  3,915
  4,272
  4,648
  5,042
  5,456
  5,898
  6,356
  6,838
  7,345
  7,879
  8,441
  9,032
  9,654
  10,310
  11,000
  11,727
  12,493
  13,299
  14,148
  15,043
  15,985
  16,977
  18,021
  19,122
  20,280

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
  21,959
  23,294
  24,686
  26,136
  27,648
  29,227
  30,875
  32,595
  34,394
  36,273
  38,239
  40,295
  42,446
  44,698
  47,055
  49,524
  52,110
  54,820
  57,660
  60,637
  63,757
  67,028
  70,459
  74,057
  77,831
  81,789
  85,942
  90,299
  94,871
  99,668
Adjusted assets (=assets-cash), $m
  21,959
  23,294
  24,686
  26,136
  27,648
  29,227
  30,875
  32,595
  34,394
  36,273
  38,239
  40,295
  42,446
  44,698
  47,055
  49,524
  52,110
  54,820
  57,660
  60,637
  63,757
  67,028
  70,459
  74,057
  77,831
  81,789
  85,942
  90,299
  94,871
  99,668
Revenue / Adjusted assets
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
Average production assets, $m
  18,031
  19,127
  20,270
  21,461
  22,703
  23,999
  25,351
  26,765
  28,241
  29,784
  31,398
  33,086
  34,853
  36,702
  38,638
  40,665
  42,789
  45,014
  47,345
  49,790
  52,352
  55,038
  57,855
  60,809
  63,908
  67,158
  70,568
  74,146
  77,900
  81,839
Working capital, $m
  -1,997
  -2,119
  -2,245
  -2,377
  -2,515
  -2,658
  -2,808
  -2,965
  -3,128
  -3,299
  -3,478
  -3,665
  -3,861
  -4,066
  -4,280
  -4,505
  -4,740
  -4,986
  -5,245
  -5,515
  -5,799
  -6,097
  -6,409
  -6,736
  -7,079
  -7,439
  -7,817
  -8,213
  -8,629
  -9,066
Total debt, $m
  10,503
  11,419
  12,373
  13,368
  14,406
  15,489
  16,619
  17,799
  19,033
  20,322
  21,671
  23,081
  24,557
  26,102
  27,719
  29,413
  31,187
  33,046
  34,994
  37,036
  39,176
  41,420
  43,774
  46,242
  48,831
  51,546
  54,395
  57,384
  60,520
  63,811
Total liabilities, $m
  15,064
  15,980
  16,934
  17,929
  18,967
  20,050
  21,180
  22,360
  23,594
  24,883
  26,232
  27,642
  29,118
  30,663
  32,280
  33,974
  35,748
  37,607
  39,555
  41,597
  43,737
  45,981
  48,335
  50,803
  53,392
  56,107
  58,956
  61,945
  65,081
  68,372
Total equity, $m
  6,895
  7,314
  7,751
  8,207
  8,682
  9,177
  9,695
  10,235
  10,800
  11,390
  12,007
  12,652
  13,328
  14,035
  14,775
  15,551
  16,363
  17,214
  18,105
  19,040
  20,020
  21,047
  22,124
  23,254
  24,439
  25,682
  26,986
  28,354
  29,789
  31,296
Total liabilities and equity, $m
  21,959
  23,294
  24,685
  26,136
  27,649
  29,227
  30,875
  32,595
  34,394
  36,273
  38,239
  40,294
  42,446
  44,698
  47,055
  49,525
  52,111
  54,821
  57,660
  60,637
  63,757
  67,028
  70,459
  74,057
  77,831
  81,789
  85,942
  90,299
  94,870
  99,668
Debt-to-equity ratio
  1.520
  1.560
  1.600
  1.630
  1.660
  1.690
  1.710
  1.740
  1.760
  1.780
  1.800
  1.820
  1.840
  1.860
  1.880
  1.890
  1.910
  1.920
  1.930
  1.950
  1.960
  1.970
  1.980
  1.990
  2.000
  2.010
  2.020
  2.020
  2.030
  2.040
Adjusted equity ratio
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314
  0.314

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,366
  2,648
  2,942
  3,251
  3,575
  3,915
  4,272
  4,648
  5,042
  5,456
  5,898
  6,356
  6,838
  7,345
  7,879
  8,441
  9,032
  9,654
  10,310
  11,000
  11,727
  12,493
  13,299
  14,148
  15,043
  15,985
  16,977
  18,021
  19,122
  20,280
Depreciation, amort., depletion, $m
  1,252
  1,328
  1,407
  1,489
  1,575
  1,664
  1,757
  1,855
  1,957
  2,063
  2,165
  2,282
  2,404
  2,531
  2,665
  2,804
  2,951
  3,104
  3,265
  3,434
  3,610
  3,796
  3,990
  4,194
  4,407
  4,632
  4,867
  5,114
  5,372
  5,644
Funds from operations, $m
  3,618
  3,976
  4,349
  4,740
  5,150
  5,579
  6,030
  6,502
  6,998
  7,519
  8,063
  8,638
  9,242
  9,876
  10,543
  11,245
  11,983
  12,759
  13,575
  14,434
  15,338
  16,289
  17,289
  18,342
  19,450
  20,616
  21,843
  23,135
  24,494
  25,924
Change in working capital, $m
  -117
  -121
  -127
  -132
  -138
  -144
  -150
  -157
  -164
  -171
  -179
  -187
  -196
  -205
  -214
  -225
  -235
  -246
  -258
  -271
  -284
  -298
  -312
  -327
  -343
  -360
  -378
  -396
  -416
  -436
Cash from operations, $m
  3,735
  4,097
  4,476
  4,872
  5,287
  5,723
  6,180
  6,659
  7,162
  7,690
  8,242
  8,825
  9,437
  10,081
  10,758
  11,470
  12,218
  13,005
  13,834
  14,705
  15,622
  16,586
  17,601
  18,669
  19,793
  20,976
  22,221
  23,531
  24,910
  26,361
Maintenance CAPEX, $m
  -1,171
  -1,244
  -1,319
  -1,398
  -1,480
  -1,566
  -1,655
  -1,748
  -1,846
  -1,948
  -2,054
  -2,165
  -2,282
  -2,404
  -2,531
  -2,665
  -2,804
  -2,951
  -3,104
  -3,265
  -3,434
  -3,610
  -3,796
  -3,990
  -4,194
  -4,407
  -4,632
  -4,867
  -5,114
  -5,372
New CAPEX, $m
  -1,050
  -1,096
  -1,142
  -1,191
  -1,242
  -1,296
  -1,353
  -1,413
  -1,476
  -1,543
  -1,614
  -1,688
  -1,766
  -1,849
  -1,936
  -2,027
  -2,124
  -2,225
  -2,332
  -2,444
  -2,562
  -2,686
  -2,817
  -2,954
  -3,099
  -3,250
  -3,410
  -3,578
  -3,754
  -3,939
Cash from investing activities, $m
  -2,221
  -2,340
  -2,461
  -2,589
  -2,722
  -2,862
  -3,008
  -3,161
  -3,322
  -3,491
  -3,668
  -3,853
  -4,048
  -4,253
  -4,467
  -4,692
  -4,928
  -5,176
  -5,436
  -5,709
  -5,996
  -6,296
  -6,613
  -6,944
  -7,293
  -7,657
  -8,042
  -8,445
  -8,868
  -9,311
Free cash flow, $m
  1,514
  1,757
  2,014
  2,283
  2,565
  2,861
  3,172
  3,497
  3,839
  4,199
  4,574
  4,971
  5,389
  5,828
  6,291
  6,778
  7,290
  7,829
  8,397
  8,996
  9,626
  10,289
  10,989
  11,725
  12,501
  13,318
  14,180
  15,087
  16,043
  17,049
Issuance/(repayment) of debt, $m
  863
  916
  954
  995
  1,038
  1,083
  1,130
  1,181
  1,234
  1,289
  1,348
  1,410
  1,476
  1,545
  1,617
  1,694
  1,774
  1,859
  1,948
  2,042
  2,141
  2,244
  2,353
  2,468
  2,589
  2,716
  2,849
  2,989
  3,136
  3,291
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  
  863
  916
  954
  995
  1,038
  1,083
  1,130
  1,181
  1,234
  1,289
  1,348
  1,410
  1,476
  1,545
  1,617
  1,694
  1,774
  1,859
  1,948
  2,042
  2,141
  2,244
  2,353
  2,468
  2,589
  2,716
  2,849
  2,989
  3,136
  3,291
Total cash flow (excl. dividends), $m
  2,377
  2,673
  2,969
  3,278
  3,603
  3,944
  4,302
  4,678
  5,073
  5,488
  5,923
  6,382
  6,865
  7,373
  7,908
  8,471
  9,064
  9,688
  10,345
  11,038
  11,766
  12,534
  13,342
  14,193
  15,090
  16,034
  17,028
  18,076
  19,179
  20,340
Retained Cash Flow (-), $m
  -409
  -419
  -437
  -455
  -475
  -496
  -517
  -540
  -565
  -590
  -617
  -646
  -676
  -707
  -740
  -775
  -812
  -851
  -892
  -935
  -980
  -1,027
  -1,077
  -1,130
  -1,185
  -1,243
  -1,304
  -1,368
  -1,436
  -1,506
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
  1,968
  2,254
  2,532
  2,823
  3,128
  3,448
  3,785
  4,138
  4,508
  4,898
  5,305
  5,736
  6,189
  6,666
  7,168
  7,696
  8,252
  8,837
  9,454
  10,103
  10,787
  11,506
  12,265
  13,064
  13,905
  14,791
  15,724
  16,708
  17,743
  18,834
Discount rate, %
  4.70
  4.94
  5.18
  5.44
  5.71
  6.00
  6.30
  6.61
  6.94
  7.29
  7.66
  8.04
  8.44
  8.86
  9.31
  9.77
  10.26
  10.77
  11.31
  11.88
  12.47
  13.09
  13.75
  14.44
  15.16
  15.92
  16.71
  17.55
  18.42
  19.35
PV of cash for distribution, $m
  1,879
  2,047
  2,176
  2,284
  2,369
  2,431
  2,468
  2,479
  2,464
  2,423
  2,357
  2,268
  2,159
  2,030
  1,887
  1,732
  1,569
  1,401
  1,234
  1,071
  914
  768
  634
  514
  408
  318
  242
  181
  132
  93
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

Las Vegas Sands Corp. is a developer of destination properties (integrated resorts) that feature accommodations, gaming, entertainment and retail, convention and exhibition facilities, celebrity chef restaurants and other amenities. The Company owns and operates integrated resorts in Asia and the United States. The Company's principal operating and developmental activities occur in three geographic areas: Macao, Singapore and the United States. In Macao, the Company's segments include The Venetian Macao; Sands Cotai Central; The Parisian Macao; Four Seasons Macao; Sands Macao, and Other Asia (comprises the Company's ferry operations and various other operations). In Singapore, the Company's segments include Marina Bay Sands. In the United States, the Company's segments include Las Vegas Operating Properties and Sands Bethlehem. The Company also offers players club loyalty programs at its properties, which provides access to rewards, privileges and members-only events.

FINANCIAL RATIOS  of  Las Vegas Sands (LVS)

Valuation Ratios
P/E Ratio 25.6
Price to Sales 3.7
Price to Book 6.9
Price to Tangible Book
Price to Cash Flow 10.6
Price to Free Cash Flow 16.4
Growth Rates
Sales Growth Rate -2.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -5.5%
Cap. Spend. - 3 Yr. Gr. Rate 8.9%
Financial Strength
Quick Ratio 13
Current Ratio 0
LT Debt to Equity 152.6%
Total Debt to Equity 155.3%
Interest Coverage 12
Management Effectiveness
Return On Assets 9%
Ret/ On Assets - 3 Yr. Avg. 10.8%
Return On Total Capital 10.5%
Ret/ On T. Cap. - 3 Yr. Avg. 12.9%
Return On Equity 25.7%
Return On Equity - 3 Yr. Avg. 30.6%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 48.8%
Gross Margin - 3 Yr. Avg. 47.8%
EBITDA Margin 31.7%
EBITDA Margin - 3 Yr. Avg. 33.3%
Operating Margin 21.8%
Oper. Margin - 3 Yr. Avg. 24.7%
Pre-Tax Margin 19.8%
Pre-Tax Margin - 3 Yr. Avg. 22.8%
Net Profit Margin 14.6%
Net Profit Margin - 3 Yr. Avg. 17%
Effective Tax Rate 10.6%
Eff/ Tax Rate - 3 Yr. Avg. 8.7%
Payout Ratio 174.2%

LVS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the LVS stock intrinsic value calculation we used $12882 million for the last fiscal year's total revenue generated by Las Vegas Sands. The default revenue input number comes from 0001 income statement of Las Vegas Sands. 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 LVS stock valuation model: a) initial revenue growth rate of 6.2% 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 4.7%, whose default value for LVS is calculated based on our internal credit rating of Las Vegas Sands, 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 Las Vegas Sands.
    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 LVS stock the variable cost ratio is equal to 34.2%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $5128 million in the base year in the intrinsic value calculation for LVS 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 Las Vegas Sands.

Corporate tax rate of 27% is the nominal tax rate for Las Vegas Sands. 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 LVS 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 LVS are equal to 131.8%.

Life of production assets of 14.5 years is the average useful life of capital assets used in Las Vegas Sands 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 LVS is equal to -14.6%. 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 - $6486 million for Las Vegas Sands - 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 788.004 million for Las Vegas Sands 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 Las Vegas Sands at the current share price and the inputted number of shares is $42.3 billion.

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