Intrinsic value of Quotient Limited - QTNT

Previous Close

$9.42

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$9.42

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of QTNT 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 0.6

 

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, %
  14.70
  13.73
  12.86
  12.07
  11.36
  10.73
  10.15
  9.64
  9.18
  8.76
  8.38
  8.04
  7.74
  7.47
  7.22
  7.00
  6.80
  6.62
  6.46
  6.31
  6.18
  6.06
  5.96
  5.86
  5.77
  5.70
  5.63
  5.56
  5.51
  5.46
Revenue, $m
  29
  33
  37
  41
  46
  51
  56
  61
  67
  73
  79
  85
  92
  99
  106
  113
  121
  129
  138
  146
  155
  165
  174
  185
  195
  206
  218
  230
  243
  256
Variable operating expenses, $m
  124
  141
  159
  178
  198
  220
  242
  265
  290
  315
  341
  369
  397
  427
  458
  490
  523
  558
  594
  631
  670
  711
  753
  797
  843
  891
  941
  994
  1,048
  1,106
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
  124
  141
  159
  178
  198
  220
  242
  265
  290
  315
  341
  369
  397
  427
  458
  490
  523
  558
  594
  631
  670
  711
  753
  797
  843
  891
  941
  994
  1,048
  1,106
Operating income, $m
  -95
  -108
  -122
  -137
  -152
  -169
  -186
  -204
  -222
  -242
  -262
  -283
  -305
  -328
  -352
  -376
  -402
  -428
  -456
  -485
  -515
  -546
  -578
  -612
  -648
  -685
  -723
  -763
  -805
  -849
EBITDA, $m
  -83
  -95
  -107
  -120
  -133
  -148
  -163
  -178
  -195
  -212
  -229
  -248
  -267
  -287
  -308
  -329
  -351
  -375
  -399
  -424
  -450
  -478
  -506
  -536
  -567
  -599
  -633
  -668
  -705
  -743
Interest expense (income), $m
  2
  16
  13
  16
  20
  23
  27
  31
  35
  39
  43
  48
  53
  58
  63
  68
  74
  80
  86
  92
  99
  105
  112
  120
  127
  135
  144
  153
  162
  171
  181
Earnings before tax, $m
  -111
  -121
  -138
  -156
  -175
  -195
  -216
  -238
  -261
  -285
  -310
  -336
  -363
  -391
  -420
  -450
  -481
  -514
  -548
  -583
  -620
  -658
  -698
  -740
  -783
  -828
  -876
  -925
  -977
  -1,030
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
  -111
  -121
  -138
  -156
  -175
  -195
  -216
  -238
  -261
  -285
  -310
  -336
  -363
  -391
  -420
  -450
  -481
  -514
  -548
  -583
  -620
  -658
  -698
  -740
  -783
  -828
  -876
  -925
  -977
  -1,030

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
  137
  156
  176
  197
  220
  243
  268
  294
  321
  349
  378
  409
  440
  473
  507
  543
  580
  618
  658
  700
  743
  788
  835
  884
  935
  988
  1,043
  1,101
  1,162
  1,226
Adjusted assets (=assets-cash), $m
  137
  156
  176
  197
  220
  243
  268
  294
  321
  349
  378
  409
  440
  473
  507
  543
  580
  618
  658
  700
  743
  788
  835
  884
  935
  988
  1,043
  1,101
  1,162
  1,226
Revenue / Adjusted assets
  0.212
  0.212
  0.210
  0.208
  0.209
  0.210
  0.209
  0.207
  0.209
  0.209
  0.209
  0.208
  0.209
  0.209
  0.209
  0.208
  0.209
  0.209
  0.210
  0.209
  0.209
  0.209
  0.208
  0.209
  0.209
  0.209
  0.209
  0.209
  0.209
  0.209
Average production assets, $m
  71
  81
  92
  103
  114
  127
  140
  153
  167
  182
  197
  213
  229
  246
  264
  283
  302
  322
  343
  364
  387
  410
  435
  460
  487
  514
  543
  573
  605
  638
Working capital, $m
  -6
  -7
  -8
  -9
  -10
  -11
  -12
  -13
  -14
  -16
  -17
  -18
  -20
  -21
  -23
  -24
  -26
  -28
  -30
  -31
  -33
  -35
  -38
  -40
  -42
  -44
  -47
  -49
  -52
  -55
Total debt, $m
  73
  89
  108
  127
  147
  168
  190
  214
  238
  263
  289
  317
  345
  375
  406
  438
  471
  505
  541
  579
  618
  658
  700
  744
  790
  838
  888
  940
  995
  1,052
Total liabilities, $m
  123
  140
  158
  178
  198
  219
  241
  265
  289
  314
  340
  368
  396
  426
  457
  489
  522
  556
  592
  630
  668
  709
  751
  795
  841
  889
  939
  991
  1,046
  1,103
Total equity, $m
  14
  16
  18
  20
  22
  24
  27
  29
  32
  35
  38
  41
  44
  47
  51
  54
  58
  62
  66
  70
  74
  79
  83
  88
  93
  99
  104
  110
  116
  123
Total liabilities and equity, $m
  137
  156
  176
  198
  220
  243
  268
  294
  321
  349
  378
  409
  440
  473
  508
  543
  580
  618
  658
  700
  742
  788
  834
  883
  934
  988
  1,043
  1,101
  1,162
  1,226
Debt-to-equity ratio
  5.290
  5.730
  6.110
  6.420
  6.680
  6.910
  7.100
  7.270
  7.410
  7.540
  7.650
  7.750
  7.840
  7.920
  8.000
  8.060
  8.120
  8.180
  8.230
  8.270
  8.310
  8.350
  8.390
  8.420
  8.450
  8.480
  8.510
  8.540
  8.560
  8.580
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
  -111
  -121
  -138
  -156
  -175
  -195
  -216
  -238
  -261
  -285
  -310
  -336
  -363
  -391
  -420
  -450
  -481
  -514
  -548
  -583
  -620
  -658
  -698
  -740
  -783
  -828
  -876
  -925
  -977
  -1,030
Depreciation, amort., depletion, $m
  12
  14
  15
  17
  19
  21
  23
  26
  28
  30
  33
  35
  38
  41
  44
  47
  50
  54
  57
  61
  64
  68
  72
  77
  81
  86
  91
  96
  101
  106
Funds from operations, $m
  -99
  -108
  -123
  -139
  -156
  -174
  -193
  -213
  -233
  -255
  -277
  -300
  -325
  -350
  -376
  -403
  -431
  -460
  -491
  -523
  -556
  -590
  -626
  -663
  -702
  -743
  -785
  -829
  -876
  -924
Change in working capital, $m
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
Cash from operations, $m
  -98
  -107
  -122
  -138
  -155
  -173
  -192
  -212
  -232
  -254
  -276
  -299
  -323
  -348
  -374
  -401
  -429
  -459
  -489
  -521
  -554
  -588
  -624
  -661
  -700
  -740
  -783
  -827
  -873
  -921
Maintenance CAPEX, $m
  -10
  -12
  -14
  -15
  -17
  -19
  -21
  -23
  -26
  -28
  -30
  -33
  -35
  -38
  -41
  -44
  -47
  -50
  -54
  -57
  -61
  -64
  -68
  -72
  -77
  -81
  -86
  -91
  -96
  -101
New CAPEX, $m
  -9
  -10
  -10
  -11
  -12
  -12
  -13
  -13
  -14
  -15
  -15
  -16
  -16
  -17
  -18
  -18
  -19
  -20
  -21
  -22
  -23
  -23
  -24
  -25
  -27
  -28
  -29
  -30
  -32
  -33
Cash from investing activities, $m
  -19
  -22
  -24
  -26
  -29
  -31
  -34
  -36
  -40
  -43
  -45
  -49
  -51
  -55
  -59
  -62
  -66
  -70
  -75
  -79
  -84
  -87
  -92
  -97
  -104
  -109
  -115
  -121
  -128
  -134
Free cash flow, $m
  -118
  -129
  -146
  -165
  -184
  -205
  -226
  -248
  -272
  -296
  -321
  -348
  -375
  -404
  -433
  -464
  -496
  -529
  -564
  -599
  -637
  -676
  -716
  -759
  -803
  -849
  -897
  -948
  -1,000
  -1,055
Issuance/(repayment) of debt, $m
  -14
  17
  18
  19
  20
  21
  22
  23
  24
  25
  26
  27
  28
  30
  31
  32
  33
  35
  36
  37
  39
  41
  42
  44
  46
  48
  50
  52
  55
  57
Issuance/(repurchase) of shares, $m
  143
  123
  140
  159
  178
  198
  219
  241
  264
  288
  313
  339
  366
  394
  423
  454
  485
  518
  552
  587
  624
  663
  703
  745
  788
  834
  881
  931
  983
  1,037
Cash from financing (excl. dividends), $m  
  129
  140
  158
  178
  198
  219
  241
  264
  288
  313
  339
  366
  394
  424
  454
  486
  518
  553
  588
  624
  663
  704
  745
  789
  834
  882
  931
  983
  1,038
  1,094
Total cash flow (excl. dividends), $m
  11
  12
  12
  13
  14
  15
  15
  16
  17
  17
  18
  19
  19
  20
  21
  22
  23
  23
  24
  25
  26
  28
  29
  30
  31
  33
  34
  35
  37
  39
Retained Cash Flow (-), $m
  -143
  -123
  -140
  -159
  -178
  -198
  -219
  -241
  -264
  -288
  -313
  -339
  -366
  -394
  -423
  -454
  -485
  -518
  -552
  -587
  -624
  -663
  -703
  -745
  -788
  -834
  -881
  -931
  -983
  -1,037
Prev. year cash balance distribution, $m
  4
  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
  -128
  -112
  -128
  -145
  -164
  -183
  -204
  -225
  -247
  -271
  -295
  -320
  -347
  -374
  -402
  -432
  -463
  -494
  -528
  -562
  -598
  -635
  -674
  -715
  -757
  -801
  -847
  -895
  -946
  -998
Discount rate, %
  12.70
  13.34
  14.00
  14.70
  15.44
  16.21
  17.02
  17.87
  18.76
  19.70
  20.69
  21.72
  22.81
  23.95
  25.15
  26.40
  27.72
  29.11
  30.56
  32.09
  33.70
  35.38
  37.15
  39.01
  40.96
  43.01
  45.16
  47.41
  49.79
  52.27
PV of cash for distribution, $m
  -114
  -87
  -86
  -84
  -80
  -74
  -68
  -60
  -53
  -45
  -37
  -30
  -24
  -19
  -14
  -10
  -7
  -5
  -3
  -2
  -1
  -1
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  5.0
  0.5
  0.1
  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
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
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  0.0
  0.0

Quotient Limited is a diagnostics company. The Company focuses on blood grouping and donor disease screening, which is referred to as transfusion diagnostics. It is engaged in developing, manufacturing and commercializing conventional reagent products used for blood grouping within the global transfusion diagnostics market. It is engaged in developing MosaiQ, which is its technology platform. The Company develops, manufactures and commercializes the products, including antisera products, reagent red blood cells, whole blood controls and ancillary products. Its antisera products contain antibodies used to identify blood group antigens. Its antisera products are monoclonal antibodies manufactured from master cell lines it owns. Its reagent red blood cells products are composed of human red blood cells formulated to enable the identification of blood group antibodies. The Company develops, manufactures and sells conventional reagent products to original equipment manufacturers (OEMs).

FINANCIAL RATIOS  of  Quotient Limited (QTNT)

Valuation Ratios
P/E Ratio -3.3
Price to Sales 12.7
Price to Book -11.6
Price to Tangible Book
Price to Cash Flow -5
Price to Free Cash Flow -3.7
Growth Rates
Sales Growth Rate 15.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -31%
Cap. Spend. - 3 Yr. Gr. Rate 23.4%
Financial Strength
Quick Ratio 11
Current Ratio 0
LT Debt to Equity -412.5%
Total Debt to Equity -420.8%
Interest Coverage -42
Management Effectiveness
Return On Assets -72.2%
Ret/ On Assets - 3 Yr. Avg. -69.9%
Return On Total Capital -98.3%
Ret/ On T. Cap. - 3 Yr. Avg. -134.4%
Return On Equity -739.1%
Return On Equity - 3 Yr. Avg. 1014.4%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 50%
Gross Margin - 3 Yr. Avg. 49.1%
EBITDA Margin -336.4%
EBITDA Margin - 3 Yr. Avg. -266.7%
Operating Margin -336.4%
Oper. Margin - 3 Yr. Avg. -253.6%
Pre-Tax Margin -386.4%
Pre-Tax Margin - 3 Yr. Avg. -297.7%
Net Profit Margin -386.4%
Net Profit Margin - 3 Yr. Avg. -297.7%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

QTNT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the QTNT stock intrinsic value calculation we used $25 million for the last fiscal year's total revenue generated by Quotient Limited. The default revenue input number comes from 0001 income statement of Quotient Limited. 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 QTNT stock valuation model: a) initial revenue growth rate of 14.7% 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 12.7%, whose default value for QTNT is calculated based on our internal credit rating of Quotient Limited, 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 Quotient Limited.
    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 QTNT stock the variable cost ratio is equal to 432%.

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 QTNT 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 18.2% for Quotient Limited.

Corporate tax rate of 27% is the nominal tax rate for Quotient Limited. 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 QTNT 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 QTNT are equal to 249.1%.

Life of production assets of 6 years is the average useful life of capital assets used in Quotient Limited 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 QTNT is equal to -21.5%. 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 - $-14.631 million for Quotient Limited - 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 65.031 million for Quotient Limited 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 Quotient Limited at the current share price and the inputted number of shares is $0.6 billion.

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