Intrinsic value of Regency Centers - REG

Previous Close

$65.21

  Intrinsic Value

$10,029

stock screener

  Rating & Target

str. buy

+999%

Previous close

$65.21

 
Intrinsic value

$10,029

 
Up/down potential

+999%

 
Rating

str. buy

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

We calculate the intrinsic value of REG 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 2017), $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 11.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   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
   2047

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
  1,574
  2,432
  3,638
  5,278
  7,447
  10,238
  13,742
  18,044
  23,218
  29,326
  36,416
  44,523
  53,665
  63,850
  75,077
  87,332
  100,599
  114,857
  130,081
  146,250
  163,342
  181,339
  200,228
  219,999
  240,651
  262,186
  284,612
  307,945
  332,206
  357,423
Variable operating expenses, $m
  1,019
  1,561
  2,323
  3,360
  4,731
  6,496
  8,711
  11,431
  14,702
  18,564
  23,023
  28,148
  33,928
  40,367
  47,465
  55,213
  63,601
  72,615
  82,240
  92,462
  103,268
  114,646
  126,588
  139,088
  152,144
  165,759
  179,937
  194,689
  210,027
  225,970
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
  1,019
  1,561
  2,323
  3,360
  4,731
  6,496
  8,711
  11,431
  14,702
  18,564
  23,023
  28,148
  33,928
  40,367
  47,465
  55,213
  63,601
  72,615
  82,240
  92,462
  103,268
  114,646
  126,588
  139,088
  152,144
  165,759
  179,937
  194,689
  210,027
  225,970
Operating income, $m
  556
  871
  1,314
  1,918
  2,715
  3,742
  5,031
  6,613
  8,516
  10,762
  13,393
  16,375
  19,737
  23,483
  27,612
  32,119
  36,999
  42,242
  47,841
  53,788
  60,074
  66,693
  73,640
  80,911
  88,507
  96,427
  104,675
  113,256
  122,179
  131,453
EBITDA, $m
  1,859
  2,872
  4,296
  6,233
  8,794
  12,089
  16,227
  21,308
  27,418
  34,631
  43,003
  52,576
  63,372
  75,400
  88,657
  103,129
  118,796
  135,632
  153,611
  172,704
  192,887
  214,140
  236,445
  259,793
  284,180
  309,610
  336,093
  363,646
  392,296
  422,073
Interest expense (income), $m
  83
  0
  2
  4
  8
  13
  19
  27
  37
  49
  64
  82
  102
  125
  151
  181
  213
  248
  286
  327
  371
  417
  466
  518
  572
  628
  688
  749
  814
  881
  950
Earnings before tax, $m
  555
  869
  1,310
  1,910
  2,703
  3,723
  5,004
  6,576
  8,466
  10,698
  13,312
  16,273
  19,612
  23,332
  27,431
  31,906
  36,751
  41,956
  47,514
  53,417
  59,657
  66,227
  73,122
  80,340
  87,878
  95,739
  103,925
  112,442
  121,298
  130,503
Tax expense, $m
  150
  235
  354
  516
  730
  1,005
  1,351
  1,775
  2,286
  2,888
  3,594
  4,394
  5,295
  6,300
  7,406
  8,615
  9,923
  11,328
  12,829
  14,423
  16,107
  17,881
  19,743
  21,692
  23,727
  25,850
  28,060
  30,359
  32,751
  35,236
Net income, $m
  405
  634
  956
  1,394
  1,973
  2,718
  3,653
  4,800
  6,181
  7,810
  9,717
  11,879
  14,316
  17,032
  20,025
  23,292
  26,828
  30,628
  34,686
  38,995
  43,550
  48,346
  53,379
  58,648
  64,151
  69,890
  75,865
  82,083
  88,548
  95,267

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
  -1,779
  -2,749
  -4,110
  -5,964
  -8,414
  -11,568
  -15,527
  -20,388
  -26,235
  -33,137
  -41,149
  -50,308
  -60,638
  -72,147
  -84,832
  -98,681
  -113,672
  -129,782
  -146,985
  -165,254
  -184,567
  -204,903
  -226,246
  -248,587
  -271,922
  -296,255
  -321,595
  -347,961
  -375,374
  -403,867
Adjusted assets (=assets-cash), $m
  -1,779
  -2,749
  -4,110
  -5,964
  -8,414
  -11,568
  -15,527
  -20,388
  -26,235
  -33,137
  -41,149
  -50,308
  -60,638
  -72,147
  -84,832
  -98,681
  -113,672
  -129,782
  -146,985
  -165,254
  -184,567
  -204,903
  -226,246
  -248,587
  -271,922
  -296,255
  -321,595
  -347,961
  -375,374
  -403,867
Revenue / Adjusted assets
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
  -0.885
Average production assets, $m
  12,801
  19,778
  29,578
  42,917
  60,549
  83,241
  111,734
  146,714
  188,785
  238,451
  296,102
  362,013
  436,348
  519,168
  610,449
  710,099
  817,974
  933,901
  1,057,692
  1,189,159
  1,328,133
  1,474,467
  1,628,051
  1,788,815
  1,956,734
  2,131,831
  2,314,179
  2,503,901
  2,701,169
  2,906,203
Working capital, $m
  -6,291
  -9,720
  -14,536
  -21,092
  -29,757
  -40,909
  -54,912
  -72,103
  -92,779
  -117,187
  -145,520
  -177,912
  -214,444
  -255,146
  -300,007
  -348,980
  -401,995
  -458,968
  -519,805
  -584,415
  -652,714
  -724,631
  -800,110
  -879,118
  -961,642
  -1,047,694
  -1,137,309
  -1,230,548
  -1,327,496
  -1,428,261
Total debt, $m
  38
  83
  147
  234
  349
  498
  684
  912
  1,187
  1,511
  1,888
  2,318
  2,804
  3,345
  3,941
  4,592
  5,297
  6,054
  6,862
  7,721
  8,629
  9,584
  10,588
  11,638
  12,734
  13,878
  15,069
  16,308
  17,597
  18,936
Total liabilities, $m
  84
  129
  193
  280
  395
  544
  730
  958
  1,233
  1,557
  1,934
  2,364
  2,850
  3,391
  3,987
  4,638
  5,343
  6,100
  6,908
  7,767
  8,675
  9,630
  10,634
  11,684
  12,780
  13,924
  15,115
  16,354
  17,643
  18,982
Total equity, $m
  -1,863
  -2,878
  -4,304
  -6,244
  -8,810
  -12,112
  -16,257
  -21,347
  -27,468
  -34,694
  -43,083
  -52,673
  -63,488
  -75,538
  -88,820
  -103,319
  -119,014
  -135,882
  -153,893
  -173,021
  -193,242
  -214,533
  -236,880
  -260,270
  -284,702
  -310,179
  -336,710
  -364,315
  -393,017
  -422,849
Total liabilities and equity, $m
  -1,779
  -2,749
  -4,111
  -5,964
  -8,415
  -11,568
  -15,527
  -20,389
  -26,235
  -33,137
  -41,149
  -50,309
  -60,638
  -72,147
  -84,833
  -98,681
  -113,671
  -129,782
  -146,985
  -165,254
  -184,567
  -204,903
  -226,246
  -248,586
  -271,922
  -296,255
  -321,595
  -347,961
  -375,374
  -403,867
Debt-to-equity ratio
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
  0.000
Adjusted equity ratio
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047
  1.047

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  405
  634
  956
  1,394
  1,973
  2,718
  3,653
  4,800
  6,181
  7,810
  9,717
  11,879
  14,316
  17,032
  20,025
  23,292
  26,828
  30,628
  34,686
  38,995
  43,550
  48,346
  53,379
  58,648
  64,151
  69,890
  75,865
  82,083
  88,548
  95,267
Depreciation, amort., depletion, $m
  1,304
  2,001
  2,981
  4,315
  6,078
  8,348
  11,197
  14,695
  18,902
  23,869
  29,610
  36,201
  43,635
  51,917
  61,045
  71,010
  81,797
  93,390
  105,769
  118,916
  132,813
  147,447
  162,805
  178,882
  195,673
  213,183
  231,418
  250,390
  270,117
  290,620
Funds from operations, $m
  1,709
  2,636
  3,938
  5,709
  8,051
  11,065
  14,849
  19,495
  25,082
  31,678
  39,328
  48,080
  57,951
  68,949
  81,070
  94,301
  108,625
  124,018
  140,455
  157,911
  176,363
  195,792
  216,184
  237,530
  259,825
  283,073
  307,283
  332,473
  358,665
  385,887
Change in working capital, $m
  -2,359
  -3,429
  -4,816
  -6,555
  -8,666
  -11,152
  -14,003
  -17,191
  -20,676
  -24,408
  -28,333
  -32,392
  -36,532
  -40,702
  -44,860
  -48,973
  -53,016
  -56,973
  -60,837
  -64,610
  -68,299
  -71,916
  -75,479
  -79,008
  -82,524
  -86,052
  -89,615
  -93,239
  -96,948
  -100,765
Cash from operations, $m
  4,068
  6,064
  8,754
  12,264
  16,717
  22,217
  28,852
  36,686
  45,758
  56,087
  67,660
  80,472
  94,483
  109,651
  125,930
  143,275
  161,641
  180,991
  201,292
  222,521
  244,662
  267,709
  291,664
  316,537
  342,349
  369,125
  396,899
  425,712
  455,612
  486,652
Maintenance CAPEX, $m
  -800
  -1,280
  -1,978
  -2,958
  -4,292
  -6,055
  -8,324
  -11,173
  -14,671
  -18,879
  -23,845
  -29,610
  -36,201
  -43,635
  -51,917
  -61,045
  -71,010
  -81,797
  -93,390
  -105,769
  -118,916
  -132,813
  -147,447
  -162,805
  -178,882
  -195,673
  -213,183
  -231,418
  -250,390
  -270,117
New CAPEX, $m
  -4,798
  -6,977
  -9,800
  -13,338
  -17,633
  -22,692
  -28,493
  -34,980
  -42,071
  -49,666
  -57,651
  -65,911
  -74,334
  -82,820
  -91,281
  -99,650
  -107,875
  -115,927
  -123,791
  -131,468
  -138,974
  -146,334
  -153,584
  -160,764
  -167,919
  -175,097
  -182,348
  -189,722
  -197,268
  -205,034
Cash from investing activities, $m
  -5,598
  -8,257
  -11,778
  -16,296
  -21,925
  -28,747
  -36,817
  -46,153
  -56,742
  -68,545
  -81,496
  -95,521
  -110,535
  -126,455
  -143,198
  -160,695
  -178,885
  -197,724
  -217,181
  -237,237
  -257,890
  -279,147
  -301,031
  -323,569
  -346,801
  -370,770
  -395,531
  -421,140
  -447,658
  -475,151
Free cash flow, $m
  -1,530
  -2,192
  -3,024
  -4,032
  -5,207
  -6,530
  -7,965
  -9,467
  -10,984
  -12,458
  -13,836
  -15,049
  -16,053
  -16,804
  -17,268
  -17,420
  -17,244
  -16,734
  -15,889
  -14,716
  -13,228
  -11,439
  -9,367
  -7,032
  -4,452
  -1,646
  1,368
  4,573
  7,955
  11,501
Issuance/(repayment) of debt, $m
  31
  46
  64
  87
  115
  148
  186
  228
  275
  324
  377
  430
  486
  541
  596
  651
  705
  757
  809
  859
  908
  956
  1,003
  1,050
  1,097
  1,144
  1,191
  1,239
  1,288
  1,339
Issuance/(repurchase) of shares, $m
  -698
  -1,015
  -1,426
  -1,941
  -2,566
  -3,302
  -4,146
  -5,090
  -6,121
  -7,226
  -8,388
  -9,590
  -10,816
  -12,050
  -13,281
  -14,499
  -15,696
  -16,867
  -18,011
  -19,128
  -20,221
  -21,291
  -22,346
  -23,391
  -24,432
  -25,476
  -26,531
  -27,604
  -28,702
  -29,832
Cash from financing (excl. dividends), $m  
  -667
  -969
  -1,362
  -1,854
  -2,451
  -3,154
  -3,960
  -4,862
  -5,846
  -6,902
  -8,011
  -9,160
  -10,330
  -11,509
  -12,685
  -13,848
  -14,991
  -16,110
  -17,202
  -18,269
  -19,313
  -20,335
  -21,343
  -22,341
  -23,335
  -24,332
  -25,340
  -26,365
  -27,414
  -28,493
Total cash flow (excl. dividends), $m
  -2,196
  -3,162
  -4,386
  -5,885
  -7,658
  -9,683
  -11,924
  -14,328
  -16,831
  -19,360
  -21,847
  -24,208
  -26,383
  -28,313
  -29,953
  -31,268
  -32,236
  -32,844
  -33,092
  -32,986
  -32,541
  -31,774
  -30,710
  -29,373
  -27,787
  -25,979
  -23,973
  -21,793
  -19,459
  -16,992
Retained Cash Flow (-), $m
  698
  1,015
  1,426
  1,941
  2,566
  3,302
  4,146
  5,090
  6,121
  7,226
  8,388
  9,590
  10,816
  12,050
  13,281
  14,499
  15,696
  16,867
  18,011
  19,128
  20,221
  21,291
  22,346
  23,391
  24,432
  25,476
  26,531
  27,604
  28,702
  29,832
Prev. year cash balance distribution, $m
  1,164
  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
  698
  1,015
  1,426
  1,941
  2,566
  3,302
  4,146
  5,090
  6,121
  7,226
  8,388
  9,590
  10,816
  12,050
  13,281
  14,499
  15,696
  16,867
  18,011
  19,128
  20,221
  21,291
  22,346
  23,391
  24,432
  25,476
  26,531
  27,604
  28,702
  29,832
Discount rate, %
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
  0.00
PV of cash for distribution, $m
  698
  1,015
  1,426
  1,941
  2,566
  3,302
  4,146
  5,090
  6,121
  7,226
  8,388
  9,590
  10,816
  12,050
  13,281
  14,499
  15,696
  16,867
  18,011
  19,128
  20,221
  21,291
  22,346
  23,391
  24,432
  25,476
  26,531
  27,604
  28,702
  29,832
Current shareholders' claim on cash, %
  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
  100.0

Regency Centers Corporation is a real estate investment trust (REIT). The Company is the general partner of Regency Centers, L.P. (the Operating Partnership). The Company is engaged in the ownership, management, leasing, acquisition and development of retail shopping centers through the Operating Partnership. The Company's properties include Palm Valley Marketplace, Shops at Arizona, Amerige Heights Town Center, Clayton Valley Shopping Center, Five Points Shopping Center, French Valley Village Center, Hasley Canyon Village, Pleasant Hill Shopping Center, Snell & Branham Plaza, Applewood Shopping Center, Kent Place, Black Rock, Spring Valley Shopping Center and Pebblebrook Plaza. As of December 31, 2016, the Company owned all of the Preferred Units of the Operating Partnership and approximately 99.9% of the Units in the Operating Partnership. As of December 31, 2016, it owned direct or partial interests in 307 shopping centers.

FINANCIAL RATIOS  of  Regency Centers (REG)

Valuation Ratios
P/E Ratio 57.6
Price to Sales 11.1
Price to Book 2.6
Price to Tangible Book
Price to Cash Flow 23.5
Price to Free Cash Flow -150.9
Growth Rates
Sales Growth Rate 7.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 642.2%
Cap. Spend. - 3 Yr. Gr. Rate 25.3%
Financial Strength
Quick Ratio NaN
Current Ratio NaN
LT Debt to Equity 63.4%
Total Debt to Equity 63.4%
Interest Coverage 2
Management Effectiveness
Return On Assets 4.6%
Ret/ On Assets - 3 Yr. Avg. 5.3%
Return On Total Capital 2.9%
Ret/ On T. Cap. - 3 Yr. Avg. 3.1%
Return On Equity 5.1%
Return On Equity - 3 Yr. Avg. 6%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 73.8%
Gross Margin - 3 Yr. Avg. 74.3%
EBITDA Margin 59.4%
EBITDA Margin - 3 Yr. Avg. 65.4%
Operating Margin 31.3%
Oper. Margin - 3 Yr. Avg. 33.3%
Pre-Tax Margin 19.5%
Pre-Tax Margin - 3 Yr. Avg. 21.6%
Net Profit Margin 19.2%
Net Profit Margin - 3 Yr. Avg. 21.3%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. -0.3%
Payout Ratio 188.1%

REG stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the REG stock intrinsic value calculation we used $984 million for the last fiscal year's total revenue generated by Regency Centers. The default revenue input number comes from 2017 income statement of Regency Centers. 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 REG 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 0%, whose default value for REG is calculated based on our internal credit rating of Regency Centers, 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 Regency Centers.
    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 REG stock the variable cost ratio is equal to 65.6%.

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 REG 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 Regency Centers.

Corporate tax rate of 27% is the nominal tax rate for Regency Centers. 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 REG stock is equal to 2.5%.

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 REG are equal to 813.1%.

Life of production assets of 10 years is the average useful life of capital assets used in Regency Centers 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 REG is equal to -399.6%. 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 million for Regency Centers - 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 170 million for Regency Centers 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 Regency Centers at the current share price and the inputted number of shares is $11.1 billion.

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COMPANY NEWS

▶ Regency Centers: 2Q Earnings Snapshot   [05:14PM  Associated Press]
▶ Giant grocery stores moving into D.C.-area Shoppers locations   [Jul-06-18 04:13PM  American City Business Journals]
▶ UCF-area shopping center sold for $19.8M. Here's what will happen next   [Jul-03-18 05:14PM  American City Business Journals]
▶ 'You Gotta Eat' REIT Portfolio   [Jun-15-18 07:31AM  Forbes]
▶ Wegmans is now open in Chantilly as the chain continues to grow in Greater Washington   [Jun-04-18 09:01AM  American City Business Journals]
▶ Regency Centers: 1Q Earnings Snapshot   [Apr-30-18 05:44PM  Associated Press]
▶ 5 REITs Growing Their Dividends Rapidly   [Apr-08-18 08:36AM  Forbes]
▶ REIT stocks still very risky to own   [Mar-01-18 07:39PM  CNBC Videos]
▶ Judge dismisses suit over Charlotte's Stonewall Station   [07:20AM  American City Business Journals]
▶ Regency Centers reports 4Q results   [Feb-08-18 04:45PM  Associated Press]
▶ Regency Centers Acquires Scripps Ranch Marketplace   [Jan-09-18 11:00AM  Business Wire]
▶ Curious George Store to stay in Harvard Square thanks to deal with landlord   [Nov-20-17 02:49PM  American City Business Journals]
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