Intrinsic value of Orange ADR - ORAN

Previous Close

$16.61

  Intrinsic Value

$2,791

stock screener

  Rating & Target

str. buy

+999%

Previous close

$16.61

 
Intrinsic value

$2,791

 
Up/down potential

+999%

 
Rating

str. buy

We calculate the intrinsic value of ORAN 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 1.1

 

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, %
  14.50
  13.55
  12.70
  11.93
  11.23
  10.61
  10.05
  9.54
  9.09
  8.68
  8.31
  7.98
  7.68
  7.41
  7.17
  6.96
  6.76
  6.58
  6.43
  6.28
  6.15
  6.04
  5.94
  5.84
  5.76
  5.68
  5.61
  5.55
  5.50
  5.45
Revenue, $m
  56,488
  64,143
  72,286
  80,906
  89,994
  99,542
  109,545
  120,000
  130,907
  142,270
  154,097
  166,395
  179,180
  192,465
  206,271
  220,620
  235,534
  251,043
  267,174
  283,962
  301,440
  319,645
  338,618
  358,400
  379,035
  400,572
  423,060
  446,550
  471,097
  496,760
Variable operating expenses, $m
  39,668
  44,369
  49,370
  54,665
  60,246
  66,111
  72,254
  78,675
  85,374
  92,353
  94,643
  102,196
  110,048
  118,208
  126,687
  135,500
  144,660
  154,185
  164,092
  174,403
  185,137
  196,319
  207,971
  220,121
  232,795
  246,022
  259,834
  274,261
  289,337
  305,099
Fixed operating expenses, $m
  8,458
  8,644
  8,834
  9,029
  9,227
  9,430
  9,638
  9,850
  10,067
  10,288
  10,514
  10,746
  10,982
  11,224
  11,471
  11,723
  11,981
  12,244
  12,514
  12,789
  13,070
  13,358
  13,652
  13,952
  14,259
  14,573
  14,893
  15,221
  15,556
  15,898
Total operating expenses, $m
  48,126
  53,013
  58,204
  63,694
  69,473
  75,541
  81,892
  88,525
  95,441
  102,641
  105,157
  112,942
  121,030
  129,432
  138,158
  147,223
  156,641
  166,429
  176,606
  187,192
  198,207
  209,677
  221,623
  234,073
  247,054
  260,595
  274,727
  289,482
  304,893
  320,997
Operating income, $m
  8,362
  11,129
  14,081
  17,213
  20,520
  24,001
  27,653
  31,475
  35,466
  39,629
  48,940
  53,453
  58,149
  63,034
  68,114
  73,397
  78,894
  84,614
  90,568
  96,770
  103,232
  109,968
  116,994
  124,326
  131,981
  139,977
  148,332
  157,068
  166,204
  175,763
EBITDA, $m
  19,872
  23,525
  27,418
  31,547
  35,907
  40,492
  45,301
  50,333
  55,586
  61,064
  66,768
  72,705
  78,880
  85,302
  91,979
  98,923
  106,145
  113,659
  121,480
  129,624
  138,108
  146,951
  156,172
  165,793
  175,835
  186,323
  197,280
  208,733
  220,709
  233,238
Interest expense (income), $m
  1,408
  2,792
  3,394
  4,039
  4,726
  5,454
  6,220
  7,026
  7,869
  8,751
  9,672
  10,630
  11,628
  12,665
  13,744
  14,865
  16,029
  17,240
  18,498
  19,806
  21,167
  22,583
  24,058
  25,593
  27,194
  28,863
  30,604
  32,420
  34,317
  36,299
  38,370
Earnings before tax, $m
  5,571
  7,736
  10,042
  12,486
  15,067
  17,781
  20,627
  23,605
  26,715
  29,957
  38,309
  41,826
  45,484
  49,290
  53,249
  57,368
  61,654
  66,116
  70,762
  75,603
  80,649
  85,911
  91,401
  97,132
  103,119
  109,373
  115,912
  122,750
  129,905
  137,393
Tax expense, $m
  1,504
  2,089
  2,711
  3,371
  4,068
  4,801
  5,569
  6,373
  7,213
  8,089
  10,344
  11,293
  12,281
  13,308
  14,377
  15,489
  16,647
  17,851
  19,106
  20,413
  21,775
  23,196
  24,678
  26,226
  27,842
  29,531
  31,296
  33,143
  35,074
  37,096
Net income, $m
  4,066
  5,647
  7,330
  9,115
  10,999
  12,980
  15,058
  17,232
  19,502
  21,869
  27,966
  30,533
  33,203
  35,982
  38,872
  41,878
  45,007
  48,264
  51,656
  55,190
  58,873
  62,715
  66,723
  70,907
  75,277
  79,843
  84,616
  89,608
  94,831
  100,297

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
  130,158
  147,794
  166,557
  186,419
  207,360
  229,360
  252,408
  276,497
  301,629
  327,812
  355,061
  383,399
  412,856
  443,468
  475,280
  508,340
  542,706
  578,439
  615,609
  654,290
  694,561
  736,509
  780,225
  825,805
  873,353
  922,977
  974,792
  1,028,916
  1,085,477
  1,144,608
Adjusted assets (=assets-cash), $m
  130,158
  147,794
  166,557
  186,419
  207,360
  229,360
  252,408
  276,497
  301,629
  327,812
  355,061
  383,399
  412,856
  443,468
  475,280
  508,340
  542,706
  578,439
  615,609
  654,290
  694,561
  736,509
  780,225
  825,805
  873,353
  922,977
  974,792
  1,028,916
  1,085,477
  1,144,608
Revenue / Adjusted assets
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
  0.434
Average production assets, $m
  60,782
  69,018
  77,779
  87,055
  96,834
  107,107
  117,870
  129,120
  140,856
  153,083
  165,808
  179,041
  192,797
  207,093
  221,948
  237,387
  253,435
  270,122
  287,480
  305,543
  324,349
  343,938
  364,352
  385,638
  407,842
  431,016
  455,212
  480,487
  506,901
  534,514
Working capital, $m
  -12,597
  -14,304
  -16,120
  -18,042
  -20,069
  -22,198
  -24,429
  -26,760
  -29,192
  -31,726
  -34,364
  -37,106
  -39,957
  -42,920
  -45,999
  -49,198
  -52,524
  -55,983
  -59,580
  -63,323
  -67,221
  -71,281
  -75,512
  -79,923
  -84,525
  -89,328
  -94,342
  -99,581
  -105,055
  -110,777
Total debt, $m
  62,846
  74,804
  87,524
  100,991
  115,189
  130,105
  145,731
  162,064
  179,104
  196,856
  215,330
  234,544
  254,515
  275,271
  296,839
  319,254
  342,553
  366,781
  391,982
  418,208
  445,512
  473,952
  503,591
  534,495
  566,733
  600,378
  635,508
  672,204
  710,553
  750,644
Total liabilities, $m
  88,247
  100,204
  112,925
  126,392
  140,590
  155,506
  171,132
  187,465
  204,504
  222,256
  240,731
  259,945
  279,916
  300,672
  322,240
  344,655
  367,954
  392,182
  417,383
  443,608
  470,912
  499,353
  528,992
  559,896
  592,134
  625,779
  660,909
  697,605
  735,954
  776,044
Total equity, $m
  41,911
  47,590
  53,631
  60,027
  66,770
  73,854
  81,275
  89,032
  97,125
  105,555
  114,330
  123,455
  132,940
  142,797
  153,040
  163,685
  174,751
  186,257
  198,226
  210,681
  223,649
  237,156
  251,232
  265,909
  281,220
  297,199
  313,883
  331,311
  349,524
  368,564
Total liabilities and equity, $m
  130,158
  147,794
  166,556
  186,419
  207,360
  229,360
  252,407
  276,497
  301,629
  327,811
  355,061
  383,400
  412,856
  443,469
  475,280
  508,340
  542,705
  578,439
  615,609
  654,289
  694,561
  736,509
  780,224
  825,805
  873,354
  922,978
  974,792
  1,028,916
  1,085,478
  1,144,608
Debt-to-equity ratio
  1.500
  1.570
  1.630
  1.680
  1.730
  1.760
  1.790
  1.820
  1.840
  1.860
  1.880
  1.900
  1.910
  1.930
  1.940
  1.950
  1.960
  1.970
  1.980
  1.990
  1.990
  2.000
  2.000
  2.010
  2.020
  2.020
  2.020
  2.030
  2.030
  2.040
Adjusted equity ratio
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322
  0.322

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  4,066
  5,647
  7,330
  9,115
  10,999
  12,980
  15,058
  17,232
  19,502
  21,869
  27,966
  30,533
  33,203
  35,982
  38,872
  41,878
  45,007
  48,264
  51,656
  55,190
  58,873
  62,715
  66,723
  70,907
  75,277
  79,843
  84,616
  89,608
  94,831
  100,297
Depreciation, amort., depletion, $m
  11,510
  12,395
  13,337
  14,335
  15,386
  16,491
  17,648
  18,858
  20,120
  21,435
  17,829
  19,252
  20,731
  22,268
  23,865
  25,525
  27,251
  29,045
  30,912
  32,854
  34,876
  36,983
  39,178
  41,466
  43,854
  46,346
  48,948
  51,665
  54,505
  57,475
Funds from operations, $m
  15,576
  18,042
  20,668
  23,450
  26,385
  29,471
  32,706
  36,090
  39,622
  43,304
  45,795
  49,784
  53,934
  58,250
  62,737
  67,404
  72,258
  77,310
  82,568
  88,044
  93,750
  99,697
  105,900
  112,373
  119,130
  126,188
  133,563
  141,273
  149,336
  157,772
Change in working capital, $m
  -1,595
  -1,707
  -1,816
  -1,922
  -2,027
  -2,129
  -2,231
  -2,331
  -2,432
  -2,534
  -2,637
  -2,743
  -2,851
  -2,963
  -3,079
  -3,200
  -3,326
  -3,458
  -3,597
  -3,744
  -3,898
  -4,060
  -4,231
  -4,411
  -4,602
  -4,803
  -5,015
  -5,238
  -5,474
  -5,723
Cash from operations, $m
  17,171
  19,749
  22,484
  25,372
  28,412
  31,600
  34,937
  38,421
  42,054
  45,838
  48,432
  52,527
  56,785
  61,212
  65,816
  70,604
  75,584
  80,768
  86,165
  91,788
  97,647
  103,757
  110,131
  116,785
  123,732
  130,991
  138,578
  146,511
  154,810
  163,494
Maintenance CAPEX, $m
  -5,706
  -6,536
  -7,421
  -8,363
  -9,361
  -10,412
  -11,517
  -12,674
  -13,884
  -15,146
  -16,461
  -17,829
  -19,252
  -20,731
  -22,268
  -23,865
  -25,525
  -27,251
  -29,045
  -30,912
  -32,854
  -34,876
  -36,983
  -39,178
  -41,466
  -43,854
  -46,346
  -48,948
  -51,665
  -54,505
New CAPEX, $m
  -7,714
  -8,236
  -8,762
  -9,276
  -9,779
  -10,274
  -10,763
  -11,249
  -11,736
  -12,227
  -12,725
  -13,233
  -13,756
  -14,295
  -14,855
  -15,439
  -16,048
  -16,687
  -17,358
  -18,063
  -18,806
  -19,589
  -20,415
  -21,285
  -22,204
  -23,174
  -24,196
  -25,275
  -26,413
  -27,613
Cash from investing activities, $m
  -13,420
  -14,772
  -16,183
  -17,639
  -19,140
  -20,686
  -22,280
  -23,923
  -25,620
  -27,373
  -29,186
  -31,062
  -33,008
  -35,026
  -37,123
  -39,304
  -41,573
  -43,938
  -46,403
  -48,975
  -51,660
  -54,465
  -57,398
  -60,463
  -63,670
  -67,028
  -70,542
  -74,223
  -78,078
  -82,118
Free cash flow, $m
  3,751
  4,978
  6,301
  7,733
  9,272
  10,914
  12,657
  14,498
  16,434
  18,465
  19,246
  21,465
  23,778
  26,186
  28,693
  31,300
  34,011
  36,830
  39,762
  42,813
  45,987
  49,292
  52,734
  56,321
  60,062
  63,963
  68,036
  72,289
  76,732
  81,376
Issuance/(repayment) of debt, $m
  11,145
  11,957
  12,721
  13,467
  14,198
  14,916
  15,626
  16,333
  17,040
  17,752
  18,475
  19,213
  19,972
  20,755
  21,568
  22,415
  23,300
  24,227
  25,201
  26,225
  27,304
  28,441
  29,639
  30,904
  32,238
  33,645
  35,130
  36,696
  38,349
  40,091
Issuance/(repurchase) of shares, $m
  1,244
  32
  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  
  12,389
  11,989
  12,721
  13,467
  14,198
  14,916
  15,626
  16,333
  17,040
  17,752
  18,475
  19,213
  19,972
  20,755
  21,568
  22,415
  23,300
  24,227
  25,201
  26,225
  27,304
  28,441
  29,639
  30,904
  32,238
  33,645
  35,130
  36,696
  38,349
  40,091
Total cash flow (excl. dividends), $m
  16,140
  16,967
  19,022
  21,200
  23,470
  25,831
  28,283
  30,830
  33,473
  36,217
  37,721
  40,678
  43,749
  46,941
  50,261
  53,714
  57,311
  61,057
  64,963
  69,038
  73,291
  77,733
  82,373
  87,225
  92,299
  97,608
  103,166
  108,985
  115,080
  121,467
Retained Cash Flow (-), $m
  -5,311
  -5,679
  -6,042
  -6,396
  -6,743
  -7,084
  -7,421
  -7,757
  -8,093
  -8,431
  -8,774
  -9,125
  -9,485
  -9,857
  -10,243
  -10,645
  -11,066
  -11,506
  -11,969
  -12,455
  -12,967
  -13,507
  -14,076
  -14,677
  -15,310
  -15,979
  -16,684
  -17,428
  -18,213
  -19,040
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
  10,830
  11,288
  12,980
  14,804
  16,727
  18,746
  20,862
  23,073
  25,381
  27,786
  28,947
  31,553
  34,264
  37,084
  40,017
  43,069
  46,245
  49,551
  52,995
  56,583
  60,324
  64,225
  68,297
  72,548
  76,989
  81,630
  86,482
  91,557
  96,867
  102,426
Discount rate, %
  6.20
  6.51
  6.84
  7.18
  7.54
  7.91
  8.31
  8.72
  9.16
  9.62
  10.10
  10.60
  11.13
  11.69
  12.28
  12.89
  13.53
  14.21
  14.92
  15.67
  16.45
  17.27
  18.14
  19.04
  20.00
  21.00
  22.05
  23.15
  24.30
  25.52
PV of cash for distribution, $m
  10,197
  9,950
  10,645
  11,220
  11,632
  11,871
  11,932
  11,817
  11,533
  11,092
  10,046
  9,414
  8,686
  7,887
  7,046
  6,190
  5,345
  4,533
  3,773
  3,080
  2,463
  1,929
  1,478
  1,106
  808
  575
  399
  269
  176
  112
Current shareholders' claim on cash, %
  95.4
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3
  95.3

Orange SA is a telecommunications operator. The Company also provides telecommunication services to multinational companies, under the brand Orange Business Services. The Company's segments include France, Spain, Poland, Belgium and Luxembourg, Central European countries, Africa and Middle East, Enterprise, and International Carriers & Shared Services. The Company provides consumers, businesses and other telecommunications operators with a range of services, including fixed telephony and mobile telecommunications, data transmission and other value-added services, mainly in Europe, Africa and the Middle East. The Company offers fixed-line telephony, mobile telephony and Internet services in France. The Company offers fixed-line telephony, mobile telephony and Internet services in Spain. The Company offers fixed-line and mobile telephony, and Internet services in Poland. The Company operates through Mobistar and Groupama Banque SA.

FINANCIAL RATIOS  of  Orange ADR (ORAN)

Valuation Ratios
P/E Ratio 14.3
Price to Sales 1
Price to Book 1.4
Price to Tangible Book
Price to Cash Flow 4.8
Price to Free Cash Flow 162.4
Growth Rates
Sales Growth Rate 1.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 9.3%
Cap. Spend. - 3 Yr. Gr. Rate 6.8%
Financial Strength
Quick Ratio 1
Current Ratio 0
LT Debt to Equity 95.9%
Total Debt to Equity 123.9%
Interest Coverage 2
Management Effectiveness
Return On Assets 3.9%
Ret/ On Assets - 3 Yr. Avg. 3.1%
Return On Total Capital 4.4%
Ret/ On T. Cap. - 3 Yr. Avg. 3.3%
Return On Equity 9.5%
Return On Equity - 3 Yr. Avg. 7.2%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 74.8%
Gross Margin - 3 Yr. Avg. 68.7%
EBITDA Margin 24.5%
EBITDA Margin - 3 Yr. Avg. 25.1%
Operating Margin 10%
Oper. Margin - 3 Yr. Avg. 11.1%
Pre-Tax Margin 4.8%
Pre-Tax Margin - 3 Yr. Avg. 6.7%
Net Profit Margin 7.2%
Net Profit Margin - 3 Yr. Avg. 5.4%
Effective Tax Rate 49%
Eff/ Tax Rate - 3 Yr. Avg. 41.1%
Payout Ratio 54.4%

ORAN stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ORAN stock intrinsic value calculation we used $49334.9339736 million for the last fiscal year's total revenue generated by Orange ADR. The default revenue input number comes from 0001 income statement of Orange ADR. 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 ORAN stock valuation model: a) initial revenue growth rate of 14.5% 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 6.2%, whose default value for ORAN is calculated based on our internal credit rating of Orange ADR, 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 Orange ADR.
    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 ORAN stock the variable cost ratio is equal to 71.5%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $8276 million in the base year in the intrinsic value calculation for ORAN 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 Orange ADR.

Corporate tax rate of 27% is the nominal tax rate for Orange ADR. 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 ORAN 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 ORAN are equal to 107.6%.

Life of production assets of 9.3 years is the average useful life of capital assets used in Orange ADR 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 ORAN is equal to -22.3%. 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 - $36600.240096 million for Orange ADR - 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 63.965 million for Orange ADR 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 Orange ADR at the current share price and the inputted number of shares is $1.1 billion.

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COMPANY NEWS

▶ Is Orange SAs (EPA:ORA) CEO Salary Justified?   [Nov-20-18 05:04AM  Simply Wall St.]
▶ Orange SA (EPA:ORA): What Are The Future Prospects?   [Oct-25-18 03:12AM  Simply Wall St.]
▶ What Type Of Shareholder Owns Orange SAs (EPA:ORA)?   [Oct-18-18 01:13AM  Simply Wall St.]
▶ [$$] Game Theory Part of the Art of the Sky Deal   [Sep-21-18 08:02PM  The Wall Street Journal]
▶ [$$] Blind Auction Complicates Bidding for Sky   [05:38AM  The Wall Street Journal]
▶ Will Three Billionaires Fix Frances Telecom Industry?   [Sep-09-18 12:00AM  Bloomberg]
▶ An Upstart Billionaire Gets a Soaking   [Sep-04-18 07:25AM  Bloomberg]
▶ 3 Top Dividend Stocks With Yields Over 4%   [Jun-30-18 07:21AM  Motley Fool]
▶ Altice Debt Mountain Brings On a Bout of Vertigo   [May-22-18 08:45AM  Bloomberg]
▶ Dr. Helmut Reisinger Named CEO of Orange Business Services   [May-02-18 09:00AM  Business Wire]
▶ What Is Orange SA.s (EPA:ORA) Share Price Doing?   [Apr-19-18 08:14AM  Simply Wall St.]
▶ Investors Are Undervaluing Orange SA. (EPA:ORA) By 24%   [Mar-27-18 07:48AM  Simply Wall St.]
▶ 3 Top Stocks With High Dividend Yields   [Mar-20-18 06:49PM  Motley Fool]
▶ Orange Says 'Fully Hedged' Against Coming Years' Rate Hikes   [Feb-28-18 12:26PM  Bloomberg Video]
▶ Sercomm Introduces New Series of LTE-M IoT Devices   [Feb-27-18 08:45AM  PR Newswire]
▶ Morphisec Announces $12M Series B Funding Round   [Feb-19-18 07:00AM  PR Newswire]
▶ Orange CEO Says France in Favor of Opening Barriers in Europe   [Jan-25-18 02:41AM  Bloomberg Video]
▶ Orange CEO Interview - Investor Day 2017 (Video)   [Dec-07-17 06:49AM  PR Newswire]
▶ 10 Cheap Foreign Stocks With Moats   [Oct-30-17 06:00AM  Morningstar]
▶ ETFs with exposure to Orange SA : October 23, 2017   [Oct-23-17 10:54AM  Capital Cube]
▶ ETFs with exposure to Orange SA : September 7, 2017   [Sep-07-17 01:39PM  Capital Cube]
▶ 3 High-Yield International Stocks   [Aug-28-17 06:00AM  Motley Fool]
▶ ETFs with exposure to Orange SA : August 15, 2017   [Aug-15-17 04:45PM  Capital Cube]
▶ Top Ranked Income Stocks to Buy for July 20th   [Jul-20-17 11:55AM  Zacks]
▶ Top Ranked Income Stocks to Buy for July 18th   [Jul-18-17 05:46AM  Zacks]

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