Intrinsic value of Navient - NAVI

Previous Close

$12.96

  Intrinsic Value

$3.37

stock screener

  Rating & Target

str. sell

-74%

Previous close

$12.96

 
Intrinsic value

$3.37

 
Up/down potential

-74%

 
Rating

str. sell

Our model is not good at valuating stocks of financial companies, such as NAVI.

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of NAVI 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 2016), $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 3.6

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   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

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -23.23
  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
  1,705
  1,739
  1,779
  1,825
  1,876
  1,933
  1,995
  2,063
  2,137
  2,216
  2,301
  2,392
  2,489
  2,593
  2,703
  2,819
  2,943
  3,073
  3,212
  3,358
  3,512
  3,675
  3,847
  4,028
  4,218
  4,419
  4,631
  4,853
  5,087
  5,334
  5,593
Variable operating expenses, $m
 
  148
  151
  155
  159
  164
  170
  175
  182
  188
  196
  203
  212
  220
  230
  240
  250
  261
  273
  285
  299
  312
  327
  342
  359
  376
  394
  413
  432
  453
  475
Fixed operating expenses, $m
 
  475
  486
  499
  511
  524
  537
  550
  564
  578
  593
  607
  623
  638
  654
  671
  687
  705
  722
  740
  759
  778
  797
  817
  837
  858
  880
  902
  924
  947
  971
Total operating expenses, $m
  597
  623
  637
  654
  670
  688
  707
  725
  746
  766
  789
  810
  835
  858
  884
  911
  937
  966
  995
  1,025
  1,058
  1,090
  1,124
  1,159
  1,196
  1,234
  1,274
  1,315
  1,356
  1,400
  1,446
Operating income, $m
  1,108
  1,117
  1,141
  1,171
  1,206
  1,245
  1,289
  1,338
  1,391
  1,450
  1,513
  1,581
  1,655
  1,734
  1,819
  1,909
  2,005
  2,108
  2,217
  2,332
  2,455
  2,585
  2,723
  2,868
  3,022
  3,185
  3,357
  3,539
  3,731
  3,933
  4,146
EBITDA, $m
  1,108
  1,187
  1,213
  1,245
  1,281
  1,323
  1,369
  1,421
  1,477
  1,539
  1,606
  1,678
  1,755
  1,839
  1,928
  2,023
  2,124
  2,232
  2,346
  2,468
  2,597
  2,733
  2,878
  3,031
  3,192
  3,363
  3,544
  3,734
  3,936
  4,148
  4,372
Interest expense (income), $m
  2,301
  3,971
  3,817
  3,907
  4,010
  4,126
  4,254
  4,394
  4,547
  4,712
  4,891
  5,082
  5,287
  5,505
  5,738
  5,985
  6,247
  6,525
  6,820
  7,131
  7,460
  7,807
  8,173
  8,559
  8,967
  9,396
  9,847
  10,323
  10,824
  11,351
  11,905
Earnings before tax, $m
  1,108
  -2,854
  -2,676
  -2,736
  -2,805
  -2,881
  -2,965
  -3,056
  -3,156
  -3,263
  -3,378
  -3,501
  -3,632
  -3,771
  -3,919
  -4,076
  -4,242
  -4,418
  -4,603
  -4,798
  -5,005
  -5,222
  -5,450
  -5,691
  -5,944
  -6,210
  -6,490
  -6,784
  -7,093
  -7,418
  -7,759
Tax expense, $m
  427
  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
Net income, $m
  681
  -2,854
  -2,676
  -2,736
  -2,805
  -2,881
  -2,965
  -3,056
  -3,156
  -3,263
  -3,378
  -3,501
  -3,632
  -3,771
  -3,919
  -4,076
  -4,242
  -4,418
  -4,603
  -4,798
  -5,005
  -5,222
  -5,450
  -5,691
  -5,944
  -6,210
  -6,490
  -6,784
  -7,093
  -7,418
  -7,759

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,253
  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
  121,136
  124,221
  127,079
  130,344
  134,011
  138,074
  142,532
  147,386
  152,640
  158,301
  164,376
  170,876
  177,811
  185,195
  193,042
  201,369
  210,194
  219,535
  229,414
  239,851
  250,872
  262,501
  274,764
  287,690
  301,310
  315,654
  330,757
  346,654
  363,382
  380,981
  399,491
Adjusted assets (=assets-cash), $m
  119,883
  124,221
  127,079
  130,344
  134,011
  138,074
  142,532
  147,386
  152,640
  158,301
  164,376
  170,876
  177,811
  185,195
  193,042
  201,369
  210,194
  219,535
  229,414
  239,851
  250,872
  262,501
  274,764
  287,690
  301,310
  315,654
  330,757
  346,654
  363,382
  380,981
  399,491
Revenue / Adjusted assets
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
  0.014
Average production assets, $m
  688
  701
  717
  735
  756
  779
  804
  832
  861
  893
  927
  964
  1,003
  1,045
  1,089
  1,136
  1,186
  1,239
  1,294
  1,353
  1,415
  1,481
  1,550
  1,623
  1,700
  1,781
  1,866
  1,956
  2,050
  2,149
  2,254
Working capital, $m
  0
  870
  890
  912
  938
  967
  998
  1,032
  1,068
  1,108
  1,151
  1,196
  1,245
  1,296
  1,351
  1,410
  1,471
  1,537
  1,606
  1,679
  1,756
  1,838
  1,923
  2,014
  2,109
  2,210
  2,315
  2,427
  2,544
  2,667
  2,796
Total debt, $m
  114,702
  109,064
  111,636
  114,575
  117,875
  121,531
  125,543
  129,912
  134,641
  139,736
  145,204
  151,053
  157,295
  163,940
  171,003
  178,497
  186,440
  194,847
  203,737
  213,131
  223,050
  233,515
  244,553
  256,186
  268,444
  281,354
  294,947
  309,254
  324,309
  340,148
  356,807
Total liabilities, $m
  117,437
  111,799
  114,371
  117,310
  120,610
  124,266
  128,278
  132,647
  137,376
  142,471
  147,939
  153,788
  160,030
  166,675
  173,738
  181,232
  189,175
  197,582
  206,472
  215,866
  225,785
  236,250
  247,288
  258,921
  271,179
  284,089
  297,682
  311,989
  327,044
  342,883
  359,542
Total equity, $m
  3,699
  12,422
  12,708
  13,034
  13,401
  13,807
  14,253
  14,739
  15,264
  15,830
  16,438
  17,088
  17,781
  18,519
  19,304
  20,137
  21,019
  21,954
  22,941
  23,985
  25,087
  26,250
  27,476
  28,769
  30,131
  31,565
  33,076
  34,665
  36,338
  38,098
  39,949
Total liabilities and equity, $m
  121,136
  124,221
  127,079
  130,344
  134,011
  138,073
  142,531
  147,386
  152,640
  158,301
  164,377
  170,876
  177,811
  185,194
  193,042
  201,369
  210,194
  219,536
  229,413
  239,851
  250,872
  262,500
  274,764
  287,690
  301,310
  315,654
  330,758
  346,654
  363,382
  380,981
  399,491
Debt-to-equity ratio
  31.009
  8.780
  8.780
  8.790
  8.800
  8.800
  8.810
  8.810
  8.820
  8.830
  8.830
  8.840
  8.850
  8.850
  8.860
  8.860
  8.870
  8.880
  8.880
  8.890
  8.890
  8.900
  8.900
  8.900
  8.910
  8.910
  8.920
  8.920
  8.920
  8.930
  8.930
Adjusted equity ratio
  0.031
  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
  681
  -2,854
  -2,676
  -2,736
  -2,805
  -2,881
  -2,965
  -3,056
  -3,156
  -3,263
  -3,378
  -3,501
  -3,632
  -3,771
  -3,919
  -4,076
  -4,242
  -4,418
  -4,603
  -4,798
  -5,005
  -5,222
  -5,450
  -5,691
  -5,944
  -6,210
  -6,490
  -6,784
  -7,093
  -7,418
  -7,759
Depreciation, amort., depletion, $m
  0
  70
  72
  74
  76
  78
  80
  83
  86
  89
  93
  96
  100
  104
  109
  114
  119
  124
  129
  135
  142
  148
  155
  162
  170
  178
  187
  196
  205
  215
  225
Funds from operations, $m
  1,871
  -2,784
  -2,604
  -2,663
  -2,729
  -2,803
  -2,884
  -2,973
  -3,070
  -3,174
  -3,285
  -3,404
  -3,531
  -3,667
  -3,810
  -3,963
  -4,124
  -4,294
  -4,474
  -4,663
  -4,863
  -5,074
  -5,295
  -5,529
  -5,774
  -6,032
  -6,304
  -6,589
  -6,888
  -7,203
  -7,533
Change in working capital, $m
  514
  17
  20
  23
  26
  28
  31
  34
  37
  40
  43
  45
  49
  52
  55
  58
  62
  65
  69
  73
  77
  81
  86
  90
  95
  100
  106
  111
  117
  123
  130
Cash from operations, $m
  1,357
  -2,801
  -2,624
  -2,685
  -2,755
  -2,831
  -2,915
  -3,007
  -3,106
  -3,213
  -3,328
  -3,450
  -3,580
  -3,718
  -3,865
  -4,021
  -4,185
  -4,359
  -4,543
  -4,736
  -4,940
  -5,155
  -5,381
  -5,619
  -5,870
  -6,133
  -6,409
  -6,700
  -7,005
  -7,326
  -7,663
Maintenance CAPEX, $m
  0
  -69
  -70
  -72
  -74
  -76
  -78
  -80
  -83
  -86
  -89
  -93
  -96
  -100
  -104
  -109
  -114
  -119
  -124
  -129
  -135
  -142
  -148
  -155
  -162
  -170
  -178
  -187
  -196
  -205
  -215
New CAPEX, $m
  0
  -13
  -16
  -18
  -21
  -23
  -25
  -27
  -30
  -32
  -34
  -37
  -39
  -42
  -44
  -47
  -50
  -53
  -56
  -59
  -62
  -66
  -69
  -73
  -77
  -81
  -85
  -90
  -94
  -99
  -104
Cash from investing activities, $m
  11,411
  -82
  -86
  -90
  -95
  -99
  -103
  -107
  -113
  -118
  -123
  -130
  -135
  -142
  -148
  -156
  -164
  -172
  -180
  -188
  -197
  -208
  -217
  -228
  -239
  -251
  -263
  -277
  -290
  -304
  -319
Free cash flow, $m
  12,768
  -2,883
  -2,710
  -2,776
  -2,849
  -2,930
  -3,019
  -3,115
  -3,219
  -3,331
  -3,451
  -3,579
  -3,716
  -3,860
  -4,014
  -4,177
  -4,349
  -4,530
  -4,722
  -4,925
  -5,138
  -5,362
  -5,599
  -5,847
  -6,109
  -6,384
  -6,673
  -6,976
  -7,295
  -7,630
  -7,982
Issuance/(repayment) of debt, $m
  -11,909
  -4,385
  2,571
  2,939
  3,300
  3,657
  4,012
  4,369
  4,729
  5,095
  5,468
  5,849
  6,242
  6,646
  7,063
  7,495
  7,942
  8,407
  8,891
  9,394
  9,919
  10,466
  11,037
  11,634
  12,258
  12,910
  13,593
  14,307
  15,055
  15,839
  16,660
Issuance/(repurchase) of shares, $m
  -755
  11,577
  2,962
  3,063
  3,171
  3,287
  3,410
  3,542
  3,681
  3,829
  3,985
  4,151
  4,325
  4,510
  4,704
  4,909
  5,125
  5,352
  5,591
  5,842
  6,107
  6,385
  6,677
  6,984
  7,306
  7,645
  8,001
  8,374
  8,766
  9,178
  9,610
Cash from financing (excl. dividends), $m  
  -12,908
  7,192
  5,533
  6,002
  6,471
  6,944
  7,422
  7,911
  8,410
  8,924
  9,453
  10,000
  10,567
  11,156
  11,767
  12,404
  13,067
  13,759
  14,482
  15,236
  16,026
  16,851
  17,714
  18,618
  19,564
  20,555
  21,594
  22,681
  23,821
  25,017
  26,270
Total cash flow (excl. dividends), $m
  -140
  4,309
  2,823
  3,226
  3,622
  4,014
  4,404
  4,796
  5,191
  5,592
  6,002
  6,421
  6,851
  7,295
  7,753
  8,227
  8,718
  9,228
  9,759
  10,312
  10,887
  11,488
  12,115
  12,770
  13,455
  14,171
  14,920
  15,705
  16,526
  17,386
  18,287
Retained Cash Flow (-), $m
  210
  -11,577
  -2,962
  -3,063
  -3,171
  -3,287
  -3,410
  -3,542
  -3,681
  -3,829
  -3,985
  -4,151
  -4,325
  -4,510
  -4,704
  -4,909
  -5,125
  -5,352
  -5,591
  -5,842
  -6,107
  -6,385
  -6,677
  -6,984
  -7,306
  -7,645
  -8,001
  -8,374
  -8,766
  -9,178
  -9,610
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
 
  -7,268
  -139
  164
  451
  727
  993
  1,254
  1,510
  1,764
  2,017
  2,270
  2,526
  2,785
  3,049
  3,318
  3,593
  3,877
  4,168
  4,469
  4,781
  5,104
  5,438
  5,787
  6,149
  6,526
  6,920
  7,331
  7,760
  8,208
  8,677
Discount rate, %
 
  15.40
  16.17
  16.98
  17.83
  18.72
  19.65
  20.64
  21.67
  22.75
  23.89
  25.08
  26.34
  27.66
  29.04
  30.49
  32.02
  33.62
  35.30
  37.06
  38.92
  40.86
  42.90
  45.05
  47.30
  49.67
  52.15
  54.76
  57.50
  60.37
  63.39
PV of cash for distribution, $m
 
  -6,298
  -103
  102
  234
  308
  338
  337
  314
  279
  237
  194
  153
  116
  86
  61
  42
  28
  18
  11
  7
  4
  2
  1
  1
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  100
  23.5
  18.8
  15.0
  12.0
  9.6
  7.6
  6.0
  4.8
  3.8
  3.0
  2.4
  1.9
  1.5
  1.2
  0.9
  0.7
  0.6
  0.5
  0.4
  0.3
  0.2
  0.2
  0.1
  0.1
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0

Navient Corporation provides asset management and business processing services to education, healthcare and government clients at the federal, state and local levels. The Company holds the portfolio of education loans insured or federally guaranteed under the Federal Family Education Loan Program (FFELP). It operates through four segments: FFELP Loans, Private Education Loans, Business Services and Other. It also holds the portfolio of Private Education Loans. It services its own portfolio of education loans, as well as education loans owned by the United States Department of Education (ED), financial institutions and nonprofit education lenders. It also provides business processing services to education-related clients, such as guaranty agencies and colleges and universities. It provides additional business processing services to a range of other clients, including federal agencies, state and local governments, healthcare systems and other healthcare providers and municipalities.

FINANCIAL RATIOS  of  Navient (NAVI)

Valuation Ratios
P/E Ratio 5.5
Price to Sales 2.2
Price to Book 1
Price to Tangible Book
Price to Cash Flow 2.8
Price to Free Cash Flow 2.8
Growth Rates
Sales Growth Rate -23.2%
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 1
Current Ratio NaN
LT Debt to Equity 3037.8%
Total Debt to Equity 3100.9%
Interest Coverage 1
Management Effectiveness
Return On Assets 1.6%
Ret/ On Assets - 3 Yr. Avg. 1.6%
Return On Total Capital 0.5%
Ret/ On T. Cap. - 3 Yr. Avg. 0.7%
Return On Equity 17.9%
Return On Equity - 3 Yr. Avg. 21.8%
Asset Turnover 0
Profitability Ratios
Gross Margin 140.7%
Gross Margin - 3 Yr. Avg. 132.8%
EBITDA Margin 199.9%
EBITDA Margin - 3 Yr. Avg. 167.6%
Operating Margin 65%
Oper. Margin - 3 Yr. Avg. 68.1%
Pre-Tax Margin 65%
Pre-Tax Margin - 3 Yr. Avg. 68.1%
Net Profit Margin 39.9%
Net Profit Margin - 3 Yr. Avg. 42.3%
Effective Tax Rate 38.5%
Eff/ Tax Rate - 3 Yr. Avg. 37.9%
Payout Ratio 29.5%

NAVI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the NAVI stock intrinsic value calculation we used $1705 million for the last fiscal year's total revenue generated by Navient. The default revenue input number comes from 2016 income statement of Navient. 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 NAVI 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 15.4%, whose default value for NAVI is calculated based on our internal credit rating of Navient, 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 Navient.
    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 NAVI stock the variable cost ratio is equal to 8.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $463 million in the base year in the intrinsic value calculation for NAVI 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 3.5% for Navient.

Corporate tax rate of 27% is the nominal tax rate for Navient. 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 NAVI 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 NAVI are equal to 40.3%.

Life of production assets of 10 years is the average useful life of capital assets used in Navient 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 NAVI is equal to 50%. 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 - $3699 million for Navient - 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 274.272 million for Navient 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 Navient at the current share price and the inputted number of shares is $3.6 billion.

RELATED COMPANIES Price Int.Val. Rating
NNI Nelnet Cl A 55.53 23.91  str.sell
SLM SLM 11.61 3.03  str.sell
NSM Nationstar Mor 18.29 27.82  buy

COMPANY NEWS

▶ 12 Stocks To Buy To Keep The Gains Going In 2018   [Dec-10-17 07:15PM  Forbes]
▶ ETFs with exposure to Navient Corp. : November 29, 2017   [Nov-29-17 11:58AM  Capital Cube]
▶ Warren takes on student lender Navient   [08:35AM  American City Business Journals]
▶ ETFs with exposure to Navient Corp. : November 1, 2017   [Nov-01-17 12:27PM  Capital Cube]
Financial statements of NAVI
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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