Intrinsic value of MICT - MICT

Previous Close

$0.69

  Intrinsic Value

$21.93

stock screener

  Rating & Target

str. buy

+999%

Previous close

$0.69

 
Intrinsic value

$21.93

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of MICT 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 0.0

 

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
  29
  45
  68
  99
  139
  191
  256
  337
  433
  547
  680
  831
  1,002
  1,192
  1,401
  1,630
  1,878
  2,144
  2,428
  2,730
  3,049
  3,385
  3,737
  4,106
  4,492
  4,894
  5,312
  5,748
  6,201
  6,671
Variable operating expenses, $m
  23
  35
  52
  75
  106
  146
  196
  257
  330
  417
  518
  633
  763
  908
  1,068
  1,242
  1,431
  1,633
  1,850
  2,080
  2,323
  2,579
  2,847
  3,128
  3,422
  3,728
  4,047
  4,379
  4,724
  5,083
Fixed operating expenses, $m
  8
  8
  9
  9
  9
  9
  9
  10
  10
  10
  10
  10
  11
  11
  11
  11
  12
  12
  12
  12
  13
  13
  13
  13
  14
  14
  14
  15
  15
  15
Total operating expenses, $m
  31
  43
  61
  84
  115
  155
  205
  267
  340
  427
  528
  643
  774
  919
  1,079
  1,253
  1,443
  1,645
  1,862
  2,092
  2,336
  2,592
  2,860
  3,141
  3,436
  3,742
  4,061
  4,394
  4,739
  5,098
Operating income, $m
  -1
  2
  7
  14
  24
  36
  51
  70
  93
  120
  152
  187
  228
  273
  323
  377
  436
  499
  566
  638
  713
  793
  877
  964
  1,056
  1,151
  1,251
  1,354
  1,461
  1,573
EBITDA, $m
  0
  4
  10
  18
  28
  42
  59
  80
  106
  136
  171
  212
  257
  307
  363
  424
  490
  561
  636
  717
  802
  891
  985
  1,083
  1,186
  1,293
  1,405
  1,521
  1,641
  1,767
Interest expense (income), $m
  0
  0
  1
  3
  5
  8
  12
  17
  23
  31
  40
  51
  63
  78
  94
  112
  132
  154
  177
  203
  230
  258
  289
  321
  354
  389
  426
  464
  504
  546
  589
Earnings before tax, $m
  -2
  1
  5
  10
  16
  24
  35
  48
  63
  80
  101
  124
  150
  179
  211
  245
  282
  321
  363
  408
  455
  504
  556
  610
  666
  725
  786
  850
  916
  984
Tax expense, $m
  0
  0
  1
  3
  4
  7
  9
  13
  17
  22
  27
  34
  41
  48
  57
  66
  76
  87
  98
  110
  123
  136
  150
  165
  180
  196
  212
  229
  247
  266
Net income, $m
  -2
  1
  3
  7
  12
  18
  25
  35
  46
  59
  74
  91
  110
  131
  154
  179
  206
  235
  265
  298
  332
  368
  406
  445
  486
  529
  574
  620
  668
  719

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
  49
  75
  112
  163
  230
  316
  424
  557
  716
  905
  1,123
  1,374
  1,656
  1,970
  2,316
  2,694
  3,104
  3,543
  4,013
  4,512
  5,039
  5,594
  6,177
  6,787
  7,424
  8,089
  8,780
  9,500
  10,249
  11,027
Adjusted assets (=assets-cash), $m
  49
  75
  112
  163
  230
  316
  424
  557
  716
  905
  1,123
  1,374
  1,656
  1,970
  2,316
  2,694
  3,104
  3,543
  4,013
  4,512
  5,039
  5,594
  6,177
  6,787
  7,424
  8,089
  8,780
  9,500
  10,249
  11,027
Revenue / Adjusted assets
  0.592
  0.600
  0.607
  0.607
  0.604
  0.604
  0.604
  0.605
  0.605
  0.604
  0.606
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
  0.605
Average production assets, $m
  4
  7
  10
  14
  20
  28
  37
  49
  63
  79
  99
  120
  145
  173
  203
  236
  272
  311
  352
  396
  442
  491
  542
  595
  651
  710
  770
  833
  899
  967
Working capital, $m
  7
  11
  17
  24
  34
  47
  63
  83
  107
  135
  168
  205
  247
  294
  346
  403
  464
  530
  600
  674
  753
  836
  923
  1,014
  1,109
  1,209
  1,312
  1,420
  1,532
  1,648
Total debt, $m
  20
  43
  77
  122
  183
  260
  357
  477
  620
  790
  987
  1,212
  1,466
  1,749
  2,060
  2,401
  2,769
  3,165
  3,588
  4,037
  4,511
  5,011
  5,535
  6,084
  6,658
  7,256
  7,878
  8,526
  9,200
  9,900
Total liabilities, $m
  44
  68
  101
  147
  207
  284
  382
  501
  645
  814
  1,011
  1,236
  1,490
  1,773
  2,085
  2,425
  2,793
  3,189
  3,612
  4,061
  4,535
  5,035
  5,559
  6,108
  6,682
  7,280
  7,902
  8,550
  9,224
  9,924
Total equity, $m
  5
  8
  11
  16
  23
  32
  42
  56
  72
  90
  112
  137
  166
  197
  232
  269
  310
  354
  401
  451
  504
  559
  618
  679
  742
  809
  878
  950
  1,025
  1,103
Total liabilities and equity, $m
  49
  76
  112
  163
  230
  316
  424
  557
  717
  904
  1,123
  1,373
  1,656
  1,970
  2,317
  2,694
  3,103
  3,543
  4,013
  4,512
  5,039
  5,594
  6,177
  6,787
  7,424
  8,089
  8,780
  9,500
  10,249
  11,027
Debt-to-equity ratio
  4.020
  5.780
  6.840
  7.510
  7.950
  8.230
  8.430
  8.570
  8.660
  8.730
  8.780
  8.820
  8.850
  8.880
  8.900
  8.910
  8.920
  8.930
  8.940
  8.950
  8.950
  8.960
  8.960
  8.960
  8.970
  8.970
  8.970
  8.970
  8.980
  8.980
Adjusted equity ratio
  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
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -2
  1
  3
  7
  12
  18
  25
  35
  46
  59
  74
  91
  110
  131
  154
  179
  206
  235
  265
  298
  332
  368
  406
  445
  486
  529
  574
  620
  668
  719
Depreciation, amort., depletion, $m
  1
  2
  2
  3
  4
  6
  8
  10
  13
  16
  20
  24
  29
  35
  41
  47
  54
  62
  70
  79
  88
  98
  108
  119
  130
  142
  154
  167
  180
  193
Funds from operations, $m
  -1
  2
  6
  10
  16
  24
  33
  45
  59
  75
  94
  115
  139
  165
  194
  226
  260
  297
  336
  377
  421
  466
  514
  564
  617
  671
  728
  787
  848
  912
Change in working capital, $m
  3
  4
  6
  8
  10
  13
  16
  20
  24
  28
  33
  37
  42
  47
  52
  57
  61
  66
  70
  75
  79
  83
  87
  91
  95
  99
  103
  108
  112
  116
Cash from operations, $m
  -3
  -2
  0
  3
  6
  11
  17
  25
  35
  47
  61
  77
  97
  118
  143
  170
  199
  231
  266
  302
  342
  383
  427
  473
  521
  572
  625
  679
  736
  796
Maintenance CAPEX, $m
  -1
  -1
  -1
  -2
  -3
  -4
  -6
  -7
  -10
  -13
  -16
  -20
  -24
  -29
  -35
  -41
  -47
  -54
  -62
  -70
  -79
  -88
  -98
  -108
  -119
  -130
  -142
  -154
  -167
  -180
New CAPEX, $m
  -2
  -2
  -3
  -4
  -6
  -8
  -9
  -12
  -14
  -17
  -19
  -22
  -25
  -28
  -30
  -33
  -36
  -39
  -41
  -44
  -46
  -49
  -51
  -54
  -56
  -58
  -61
  -63
  -66
  -68
Cash from investing activities, $m
  -3
  -3
  -4
  -6
  -9
  -12
  -15
  -19
  -24
  -30
  -35
  -42
  -49
  -57
  -65
  -74
  -83
  -93
  -103
  -114
  -125
  -137
  -149
  -162
  -175
  -188
  -203
  -217
  -233
  -248
Free cash flow, $m
  -6
  -5
  -5
  -4
  -3
  -1
  2
  6
  11
  18
  26
  36
  48
  62
  78
  96
  116
  138
  162
  188
  216
  246
  278
  311
  347
  383
  422
  462
  504
  548
Issuance/(repayment) of debt, $m
  14
  24
  33
  46
  60
  77
  97
  119
  144
  170
  197
  225
  254
  283
  312
  340
  368
  396
  423
  449
  475
  500
  524
  549
  573
  598
  623
  648
  674
  700
Issuance/(repurchase) of shares, $m
  6
  2
  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  
  20
  26
  33
  46
  60
  77
  97
  119
  144
  170
  197
  225
  254
  283
  312
  340
  368
  396
  423
  449
  475
  500
  524
  549
  573
  598
  623
  648
  674
  700
Total cash flow (excl. dividends), $m
  15
  21
  29
  42
  58
  77
  99
  125
  155
  187
  223
  261
  302
  345
  389
  436
  484
  534
  585
  637
  691
  746
  802
  860
  920
  981
  1,045
  1,110
  1,178
  1,248
Retained Cash Flow (-), $m
  -6
  -3
  -4
  -5
  -7
  -9
  -11
  -13
  -16
  -19
  -22
  -25
  -28
  -31
  -35
  -38
  -41
  -44
  -47
  -50
  -53
  -56
  -58
  -61
  -64
  -66
  -69
  -72
  -75
  -78
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
  9
  18
  26
  37
  51
  68
  88
  112
  139
  168
  201
  236
  273
  313
  355
  398
  443
  490
  538
  587
  638
  690
  744
  799
  856
  915
  975
  1,038
  1,103
  1,170
Discount rate, %
  9.50
  9.98
  10.47
  11.00
  11.55
  12.12
  12.73
  13.37
  14.04
  14.74
  15.47
  16.25
  17.06
  17.91
  18.81
  19.75
  20.74
  21.77
  22.86
  24.01
  25.21
  26.47
  27.79
  29.18
  30.64
  32.17
  33.78
  35.47
  37.24
  39.10
PV of cash for distribution, $m
  8
  15
  19
  24
  29
  34
  38
  41
  43
  43
  41
  39
  35
  31
  27
  22
  18
  14
  11
  8
  6
  4
  3
  2
  1
  1
  0
  0
  0
  0
Current shareholders' claim on cash, %
  37.6
  36.1
  36.0
  36.0
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Micronet Enertec Technologies, Inc. (Micronet Enertec) operates through Israel-based companies, which include Enertec Systems 2001 Ltd (Enertec), its subsidiary, and Micronet Ltd (Micronet), which develops, manufactures, integrates and markets rugged computers, tablets and computer-based systems and instruments for the commercial, defense and aerospace markets. The Company's segments include defense and aerospace segment, and mobile resource management (MRM). The Company's products, solutions and services are designed to perform in severe environments and battlefield conditions. Micronet operates in the commercial mobile resource management market and is a developer, manufacturer and provider of mobile computing platforms, designed for integration into fleet management and mobile workforce management solutions. Enertec operates in the defense and aerospace markets. Enertec designs, develops and manufactures computer based instruments and aerospace electronic solutions.

FINANCIAL RATIOS  of  MICT (MICT)

Valuation Ratios
P/E Ratio -0.7
Price to Sales 0.2
Price to Book 0.6
Price to Tangible Book
Price to Cash Flow -1.1
Price to Free Cash Flow -1.1
Growth Rates
Sales Growth Rate -4.2%
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 0
Current Ratio 0.2
LT Debt to Equity 14.3%
Total Debt to Equity 200%
Interest Coverage 0
Management Effectiveness
Return On Assets -16.7%
Ret/ On Assets - 3 Yr. Avg. -8.6%
Return On Total Capital -26.1%
Ret/ On T. Cap. - 3 Yr. Avg. -13.6%
Return On Equity -66.7%
Return On Equity - 3 Yr. Avg. -31.7%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 17.4%
Gross Margin - 3 Yr. Avg. 25.3%
EBITDA Margin -30.4%
EBITDA Margin - 3 Yr. Avg. -12.5%
Operating Margin -30.4%
Oper. Margin - 3 Yr. Avg. -14.9%
Pre-Tax Margin -34.8%
Pre-Tax Margin - 3 Yr. Avg. -17.7%
Net Profit Margin -26.1%
Net Profit Margin - 3 Yr. Avg. -13.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

MICT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the MICT stock intrinsic value calculation we used $18.366 million for the last fiscal year's total revenue generated by MICT. The default revenue input number comes from 0001 income statement of MICT. 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 MICT 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 9.5%, whose default value for MICT is calculated based on our internal credit rating of MICT, 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 MICT.
    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 MICT stock the variable cost ratio is equal to 77.8%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $8 million in the base year in the intrinsic value calculation for MICT 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 6.4% for MICT.

Corporate tax rate of 27% is the nominal tax rate for MICT. 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 MICT 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 MICT are equal to 14.5%.

Life of production assets of 3.3 years is the average useful life of capital assets used in MICT 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 MICT is equal to 24.7%. 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 - $0.379 million for MICT - 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 9.144 million for MICT 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 MICT at the current share price and the inputted number of shares is $0.0 billion.

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COMPANY NEWS

▶ MICT Reports Second Quarter 2018 Financial Results   [Aug-15-18 07:30AM  PR Newswire]
▶ DPW Holdings Agrees to Buy Enertec Systems 2001   [Jan-03-18 01:00PM  Zacks Small Cap Research]
▶ Micronet's Backlog Hits Record High at $11.5 Million   [May-25-17 08:00AM  PR Newswire]

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