Intrinsic value of Payment Data Systems, Inc. - PYDS

Previous Close

$2.99

  Intrinsic Value

$18.96

stock screener

  Rating & Target

str. buy

+534%

Previous close

$2.99

 
Intrinsic value

$18.96

 
Up/down potential

+534%

 
Rating

str. buy

We calculate the intrinsic value of PYDS 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
  24
  37
  55
  80
  114
  156
  209
  275
  354
  447
  555
  679
  818
  973
  1,144
  1,331
  1,534
  1,751
  1,983
  2,229
  2,490
  2,764
  3,052
  3,354
  3,668
  3,997
  4,339
  4,694
  5,064
  5,449
Variable operating expenses, $m
  27
  41
  61
  89
  125
  172
  231
  303
  390
  492
  610
  746
  900
  1,070
  1,259
  1,464
  1,686
  1,925
  2,181
  2,452
  2,738
  3,040
  3,356
  3,688
  4,034
  4,395
  4,771
  5,162
  5,569
  5,992
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
  27
  41
  61
  89
  125
  172
  231
  303
  390
  492
  610
  746
  900
  1,070
  1,259
  1,464
  1,686
  1,925
  2,181
  2,452
  2,738
  3,040
  3,356
  3,688
  4,034
  4,395
  4,771
  5,162
  5,569
  5,992
Operating income, $m
  -3
  -4
  -6
  -9
  -12
  -16
  -21
  -28
  -36
  -45
  -55
  -68
  -82
  -97
  -114
  -133
  -153
  -175
  -198
  -222
  -248
  -276
  -304
  -334
  -366
  -398
  -432
  -468
  -505
  -543
EBITDA, $m
  -1
  -2
  -3
  -4
  -6
  -8
  -11
  -15
  -19
  -24
  -29
  -36
  -43
  -51
  -61
  -70
  -81
  -93
  -105
  -118
  -132
  -146
  -161
  -177
  -194
  -211
  -229
  -248
  -268
  -288
Interest expense (income), $m
  0
  0
  2
  4
  8
  13
  19
  28
  38
  51
  66
  85
  106
  130
  157
  188
  221
  258
  297
  340
  385
  434
  485
  538
  595
  654
  715
  780
  847
  916
  989
Earnings before tax, $m
  -3
  -6
  -10
  -16
  -25
  -35
  -49
  -66
  -87
  -111
  -140
  -173
  -211
  -254
  -302
  -354
  -411
  -472
  -538
  -608
  -682
  -760
  -843
  -929
  -1,019
  -1,114
  -1,212
  -1,314
  -1,421
  -1,532
Tax expense, $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
Net income, $m
  -3
  -6
  -10
  -16
  -25
  -35
  -49
  -66
  -87
  -111
  -140
  -173
  -211
  -254
  -302
  -354
  -411
  -472
  -538
  -608
  -682
  -760
  -843
  -929
  -1,019
  -1,114
  -1,212
  -1,314
  -1,421
  -1,532

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
  108
  167
  250
  362
  511
  703
  944
  1,239
  1,594
  2,014
  2,501
  3,057
  3,685
  4,384
  5,155
  5,997
  6,908
  7,887
  8,932
  10,042
  11,216
  12,452
  13,749
  15,107
  16,525
  18,003
  19,543
  21,145
  22,811
  24,543
Adjusted assets (=assets-cash), $m
  108
  167
  250
  362
  511
  703
  944
  1,239
  1,594
  2,014
  2,501
  3,057
  3,685
  4,384
  5,155
  5,997
  6,908
  7,887
  8,932
  10,042
  11,216
  12,452
  13,749
  15,107
  16,525
  18,003
  19,543
  21,145
  22,811
  24,543
Revenue / Adjusted assets
  0.222
  0.222
  0.220
  0.221
  0.223
  0.222
  0.221
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
  0.222
Average production assets, $m
  6
  9
  13
  19
  27
  37
  49
  64
  83
  105
  130
  159
  191
  228
  268
  312
  359
  410
  464
  522
  583
  647
  714
  785
  858
  935
  1,015
  1,098
  1,185
  1,275
Working capital, $m
  0
  0
  -1
  -1
  -1
  -2
  -2
  -3
  -4
  -5
  -6
  -7
  -9
  -11
  -13
  -15
  -17
  -19
  -22
  -25
  -27
  -30
  -34
  -37
  -40
  -44
  -48
  -52
  -56
  -60
Total debt, $m
  33
  80
  147
  237
  357
  512
  705
  943
  1,229
  1,567
  1,959
  2,407
  2,912
  3,475
  4,096
  4,773
  5,506
  6,295
  7,136
  8,030
  8,975
  9,969
  11,014
  12,106
  13,248
  14,438
  15,678
  16,968
  18,309
  19,703
Total liabilities, $m
  87
  134
  201
  292
  412
  566
  760
  997
  1,283
  1,621
  2,013
  2,461
  2,966
  3,529
  4,150
  4,827
  5,561
  6,349
  7,190
  8,084
  9,029
  10,024
  11,068
  12,161
  13,302
  14,493
  15,732
  17,022
  18,363
  19,757
Total equity, $m
  21
  33
  49
  71
  100
  137
  184
  242
  311
  393
  488
  596
  719
  855
  1,005
  1,169
  1,347
  1,538
  1,742
  1,958
  2,187
  2,428
  2,681
  2,946
  3,222
  3,511
  3,811
  4,123
  4,448
  4,786
Total liabilities and equity, $m
  108
  167
  250
  363
  512
  703
  944
  1,239
  1,594
  2,014
  2,501
  3,057
  3,685
  4,384
  5,155
  5,996
  6,908
  7,887
  8,932
  10,042
  11,216
  12,452
  13,749
  15,107
  16,524
  18,004
  19,543
  21,145
  22,811
  24,543
Debt-to-equity ratio
  1.550
  2.460
  3.010
  3.360
  3.580
  3.730
  3.830
  3.900
  3.950
  3.990
  4.020
  4.040
  4.050
  4.060
  4.070
  4.080
  4.090
  4.090
  4.100
  4.100
  4.100
  4.110
  4.110
  4.110
  4.110
  4.110
  4.110
  4.120
  4.120
  4.120
Adjusted equity ratio
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195
  0.195

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -3
  -6
  -10
  -16
  -25
  -35
  -49
  -66
  -87
  -111
  -140
  -173
  -211
  -254
  -302
  -354
  -411
  -472
  -538
  -608
  -682
  -760
  -843
  -929
  -1,019
  -1,114
  -1,212
  -1,314
  -1,421
  -1,532
Depreciation, amort., depletion, $m
  2
  2
  3
  4
  6
  8
  10
  13
  17
  21
  26
  32
  38
  46
  54
  62
  72
  82
  93
  104
  117
  129
  143
  157
  172
  187
  203
  220
  237
  255
Funds from operations, $m
  -1
  -4
  -7
  -12
  -19
  -28
  -39
  -53
  -70
  -90
  -114
  -142
  -173
  -209
  -248
  -292
  -339
  -390
  -445
  -503
  -565
  -631
  -700
  -772
  -848
  -927
  -1,009
  -1,095
  -1,184
  -1,277
Change in working capital, $m
  0
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
Cash from operations, $m
  -1
  -4
  -7
  -12
  -18
  -27
  -38
  -52
  -69
  -89
  -113
  -140
  -172
  -207
  -246
  -289
  -337
  -388
  -442
  -501
  -562
  -628
  -697
  -769
  -844
  -923
  -1,005
  -1,091
  -1,180
  -1,272
Maintenance CAPEX, $m
  -1
  -1
  -2
  -3
  -4
  -5
  -7
  -10
  -13
  -17
  -21
  -26
  -32
  -38
  -46
  -54
  -62
  -72
  -82
  -93
  -104
  -117
  -129
  -143
  -157
  -172
  -187
  -203
  -220
  -237
New CAPEX, $m
  -2
  -3
  -4
  -6
  -8
  -10
  -12
  -15
  -18
  -22
  -25
  -29
  -33
  -36
  -40
  -44
  -47
  -51
  -54
  -58
  -61
  -64
  -67
  -71
  -74
  -77
  -80
  -83
  -87
  -90
Cash from investing activities, $m
  -3
  -4
  -6
  -9
  -12
  -15
  -19
  -25
  -31
  -39
  -46
  -55
  -65
  -74
  -86
  -98
  -109
  -123
  -136
  -151
  -165
  -181
  -196
  -214
  -231
  -249
  -267
  -286
  -307
  -327
Free cash flow, $m
  -4
  -8
  -13
  -20
  -30
  -42
  -58
  -77
  -100
  -127
  -159
  -195
  -236
  -282
  -332
  -387
  -446
  -510
  -578
  -651
  -728
  -808
  -893
  -982
  -1,075
  -1,172
  -1,272
  -1,377
  -1,486
  -1,599
Issuance/(repayment) of debt, $m
  33
  47
  67
  91
  120
  154
  194
  238
  286
  338
  392
  448
  505
  563
  621
  677
  733
  788
  842
  894
  945
  995
  1,044
  1,093
  1,142
  1,190
  1,240
  1,290
  1,341
  1,394
Issuance/(repurchase) of shares, $m
  11
  17
  26
  38
  54
  73
  96
  124
  156
  193
  235
  282
  334
  391
  452
  518
  588
  663
  741
  824
  911
  1,001
  1,095
  1,194
  1,296
  1,402
  1,512
  1,627
  1,746
  1,869
Cash from financing (excl. dividends), $m  
  44
  64
  93
  129
  174
  227
  290
  362
  442
  531
  627
  730
  839
  954
  1,073
  1,195
  1,321
  1,451
  1,583
  1,718
  1,856
  1,996
  2,139
  2,287
  2,438
  2,592
  2,752
  2,917
  3,087
  3,263
Total cash flow (excl. dividends), $m
  40
  57
  80
  109
  144
  185
  232
  284
  342
  404
  468
  535
  603
  672
  741
  809
  875
  941
  1,005
  1,067
  1,128
  1,187
  1,246
  1,305
  1,363
  1,421
  1,480
  1,540
  1,601
  1,664
Retained Cash Flow (-), $m
  -11
  -17
  -26
  -38
  -54
  -73
  -96
  -124
  -156
  -193
  -235
  -282
  -334
  -391
  -452
  -518
  -588
  -663
  -741
  -824
  -911
  -1,001
  -1,095
  -1,194
  -1,296
  -1,402
  -1,512
  -1,627
  -1,746
  -1,869
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
  29
  40
  54
  70
  90
  112
  136
  161
  186
  210
  233
  253
  269
  281
  289
  291
  287
  278
  263
  243
  217
  186
  151
  111
  67
  19
  -33
  -87
  -145
  -206
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
  28
  36
  47
  58
  70
  81
  92
  100
  107
  110
  111
  108
  102
  94
  85
  74
  62
  51
  41
  31
  22
  15
  10
  6
  3
  1
  -1
  -1
  -2
  -2
Current shareholders' claim on cash, %
  82.1
  67.5
  55.6
  46.0
  38.4
  32.2
  27.2
  23.1
  19.8
  17.0
  14.7
  12.7
  11.1
  9.7
  8.5
  7.5
  6.6
  5.9
  5.2
  4.6
  4.1
  3.7
  3.3
  3.0
  2.6
  2.4
  2.1
  1.9
  1.7
  1.6

Payment Data Systems, Inc. is engaged in the business of processing electronic payments for other companies, including a range of automated clearing house (ACH) processing, credit, prepaid card and debit card-based processing. The Company is an integrated payment solutions provider offering a range of services to merchants, billers, banks, service bureaus, and card issuers. It operates through two operating entities: Payment Data Systems, Inc. and FiCentive, Inc. Payment Data Systems, Inc. provides integrated electronic payment processing services to merchants and businesses, including credit and debit card-based processing services and transaction processing through the ACH network. Its ACH processing services enable merchants or businesses to both disburse and collect funds electronically using e-checks to transfer funds instead of traditional paper checks. The Company provides prepaid card processing services for merchants and consumers through its subsidiary, FiCentive, Inc.

FINANCIAL RATIOS  of  Payment Data Systems, Inc. (PYDS)

Valuation Ratios
P/E Ratio -35.3
Price to Sales 2.9
Price to Book 3.9
Price to Tangible Book
Price to Cash Flow 35.3
Price to Free Cash Flow 35.3
Growth Rates
Sales Growth Rate -14.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -100%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0.3
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -1.4%
Ret/ On Assets - 3 Yr. Avg. 3%
Return On Total Capital -11.1%
Ret/ On T. Cap. - 3 Yr. Avg. 33.8%
Return On Equity -11.1%
Return On Equity - 3 Yr. Avg. 33.8%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 33.3%
Gross Margin - 3 Yr. Avg. 33.3%
EBITDA Margin 0%
EBITDA Margin - 3 Yr. Avg. 7.5%
Operating Margin -8.3%
Oper. Margin - 3 Yr. Avg. 4.7%
Pre-Tax Margin -8.3%
Pre-Tax Margin - 3 Yr. Avg. 4.7%
Net Profit Margin -8.3%
Net Profit Margin - 3 Yr. Avg. 9.9%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. -33.3%
Payout Ratio 0%

PYDS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the PYDS stock intrinsic value calculation we used $15 million for the last fiscal year's total revenue generated by Payment Data Systems, Inc.. The default revenue input number comes from 0001 income statement of Payment Data Systems, Inc.. 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 PYDS 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 4.3%, whose default value for PYDS is calculated based on our internal credit rating of Payment Data Systems, Inc., 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 Payment Data Systems, Inc..
    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 PYDS stock the variable cost ratio is equal to 113.3%.

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 PYDS 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 Payment Data Systems, Inc..

Corporate tax rate of 27% is the nominal tax rate for Payment Data Systems, Inc.. 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 PYDS 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 PYDS are equal to 23.4%.

Life of production assets of 3.8 years is the average useful life of capital assets used in Payment Data Systems, Inc. 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 PYDS is equal to -1.1%. 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 - $13.123353 million for Payment Data Systems, Inc. - 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 16.700 million for Payment Data Systems, Inc. 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 Payment Data Systems, Inc. at the current share price and the inputted number of shares is $0.0 billion.

RELATED COMPANIES Price Int.Val. Rating
MA Mastercard Inc 230.39 183.95  sell
GPN Global Payment 134.04 68.68  sell
FDC First Data Cor 25.36 40.09  str.buy

CONTACT US       ASSET ALLOCATION

About X-FIN       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2019. All rigths reserved.