Intrinsic value of Ryanair Holdings plc - RYAAY

Previous Close

$69.87

  Intrinsic Value

$227.46

stock screener

  Rating & Target

str. buy

+226%

Previous close

$69.87

 
Intrinsic value

$227.46

 
Up/down potential

+226%

 
Rating

str. buy

We calculate the intrinsic value of RYAAY 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 15.8

 

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, %
  22.50
  20.75
  19.18
  17.76
  16.48
  15.33
  14.30
  13.37
  12.53
  11.78
  11.10
  10.49
  9.94
  9.45
  9.00
  8.60
  8.24
  7.92
  7.63
  7.36
  7.13
  6.91
  6.72
  6.55
  6.40
  6.26
  6.13
  6.02
  5.92
  5.82
Revenue, $m
  10,722
  12,947
  15,430
  18,170
  21,165
  24,410
  27,901
  31,631
  35,595
  39,789
  44,206
  48,844
  53,700
  58,774
  64,065
  69,577
  75,312
  81,276
  87,474
  93,916
  100,610
  107,567
  114,799
  122,319
  130,143
  138,285
  146,763
  155,594
  164,799
  174,398
Variable operating expenses, $m
  8,105
  9,785
  11,661
  13,730
  15,992
  18,444
  21,080
  23,898
  26,893
  30,060
  33,391
  36,894
  40,562
  44,395
  48,392
  52,555
  56,887
  61,391
  66,074
  70,939
  75,995
  81,250
  86,713
  92,394
  98,303
  104,453
  110,857
  117,528
  124,481
  131,731
Fixed operating expenses, $m
  99
  101
  104
  106
  108
  111
  113
  115
  118
  121
  123
  126
  129
  132
  134
  137
  140
  144
  147
  150
  153
  157
  160
  164
  167
  171
  175
  178
  182
  186
Total operating expenses, $m
  8,204
  9,886
  11,765
  13,836
  16,100
  18,555
  21,193
  24,013
  27,011
  30,181
  33,514
  37,020
  40,691
  44,527
  48,526
  52,692
  57,027
  61,535
  66,221
  71,089
  76,148
  81,407
  86,873
  92,558
  98,470
  104,624
  111,032
  117,706
  124,663
  131,917
Operating income, $m
  2,518
  3,061
  3,666
  4,334
  5,064
  5,856
  6,707
  7,617
  8,585
  9,608
  10,692
  11,824
  13,009
  14,248
  15,539
  16,885
  18,285
  19,741
  21,254
  22,827
  24,461
  26,160
  27,926
  29,762
  31,672
  33,661
  35,731
  37,888
  40,136
  42,480
EBITDA, $m
  3,360
  4,076
  4,875
  5,757
  6,721
  7,765
  8,889
  10,090
  11,367
  12,717
  14,140
  15,634
  17,198
  18,832
  20,536
  22,312
  24,159
  26,080
  28,077
  30,152
  32,309
  34,550
  36,880
  39,303
  41,824
  44,447
  47,179
  50,024
  52,990
  56,083
Interest expense (income), $m
  0
  262
  373
  499
  639
  793
  962
  1,145
  1,342
  1,552
  1,776
  2,012
  2,261
  2,523
  2,797
  3,083
  3,381
  3,692
  4,015
  4,351
  4,701
  5,064
  5,441
  5,833
  6,241
  6,665
  7,106
  7,565
  8,043
  8,541
  9,060
Earnings before tax, $m
  2,256
  2,687
  3,167
  3,695
  4,271
  4,893
  5,562
  6,275
  7,032
  7,832
  8,680
  9,562
  10,486
  11,451
  12,457
  13,504
  14,593
  15,726
  16,903
  18,126
  19,397
  20,719
  22,092
  23,521
  25,007
  26,555
  28,166
  29,845
  31,595
  33,420
Tax expense, $m
  609
  726
  855
  998
  1,153
  1,321
  1,502
  1,694
  1,899
  2,115
  2,343
  2,582
  2,831
  3,092
  3,363
  3,646
  3,940
  4,246
  4,564
  4,894
  5,237
  5,594
  5,965
  6,351
  6,752
  7,170
  7,605
  8,058
  8,531
  9,023
Net income, $m
  1,647
  1,962
  2,312
  2,697
  3,118
  3,572
  4,060
  4,581
  5,134
  5,718
  6,336
  6,981
  7,655
  8,359
  9,093
  9,858
  10,653
  11,480
  12,339
  13,232
  14,160
  15,125
  16,127
  17,170
  18,255
  19,385
  20,561
  21,787
  23,064
  24,397

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
  17,492
  21,121
  25,171
  29,641
  34,526
  39,821
  45,515
  51,600
  58,068
  64,908
  72,114
  79,680
  87,602
  95,879
  104,511
  113,502
  122,858
  132,587
  142,699
  153,207
  164,127
  175,476
  187,274
  199,542
  212,305
  225,587
  239,417
  253,825
  268,840
  284,498
Adjusted assets (=assets-cash), $m
  17,492
  21,121
  25,171
  29,641
  34,526
  39,821
  45,515
  51,600
  58,068
  64,908
  72,114
  79,680
  87,602
  95,879
  104,511
  113,502
  122,858
  132,587
  142,699
  153,207
  164,127
  175,476
  187,274
  199,542
  212,305
  225,587
  239,417
  253,825
  268,840
  284,498
Revenue / Adjusted assets
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
  0.613
Average production assets, $m
  10,873
  13,129
  15,646
  18,424
  21,461
  24,752
  28,291
  32,074
  36,094
  40,346
  44,825
  49,528
  54,452
  59,597
  64,962
  70,551
  76,366
  82,414
  88,699
  95,231
  102,018
  109,073
  116,406
  124,032
  131,965
  140,221
  148,817
  157,773
  167,106
  176,839
Working capital, $m
  -3,699
  -4,467
  -5,323
  -6,269
  -7,302
  -8,421
  -9,626
  -10,913
  -12,280
  -13,727
  -15,251
  -16,851
  -18,526
  -20,277
  -22,103
  -24,004
  -25,983
  -28,040
  -30,179
  -32,401
  -34,710
  -37,111
  -39,606
  -42,200
  -44,899
  -47,708
  -50,633
  -53,680
  -56,856
  -60,167
Total debt, $m
  6,916
  9,239
  11,831
  14,692
  17,819
  21,207
  24,851
  28,746
  32,885
  37,263
  41,875
  46,717
  51,787
  57,084
  62,609
  68,363
  74,351
  80,577
  87,049
  93,774
  100,763
  108,026
  115,577
  123,429
  131,597
  140,098
  148,949
  158,169
  167,780
  177,801
Total liabilities, $m
  11,195
  13,518
  16,110
  18,970
  22,097
  25,485
  29,130
  33,024
  37,163
  41,541
  46,153
  50,995
  56,065
  61,362
  66,887
  72,642
  78,629
  84,855
  91,327
  98,052
  105,041
  112,305
  119,855
  127,707
  135,875
  144,376
  153,227
  162,448
  172,058
  182,079
Total equity, $m
  6,297
  7,604
  9,062
  10,671
  12,430
  14,335
  16,385
  18,576
  20,904
  23,367
  25,961
  28,685
  31,537
  34,516
  37,624
  40,861
  44,229
  47,731
  51,372
  55,155
  59,086
  63,171
  67,419
  71,835
  76,430
  81,211
  86,190
  91,377
  96,783
  102,419
Total liabilities and equity, $m
  17,492
  21,122
  25,172
  29,641
  34,527
  39,820
  45,515
  51,600
  58,067
  64,908
  72,114
  79,680
  87,602
  95,878
  104,511
  113,503
  122,858
  132,586
  142,699
  153,207
  164,127
  175,476
  187,274
  199,542
  212,305
  225,587
  239,417
  253,825
  268,841
  284,498
Debt-to-equity ratio
  1.100
  1.220
  1.310
  1.380
  1.430
  1.480
  1.520
  1.550
  1.570
  1.590
  1.610
  1.630
  1.640
  1.650
  1.660
  1.670
  1.680
  1.690
  1.690
  1.700
  1.710
  1.710
  1.710
  1.720
  1.720
  1.730
  1.730
  1.730
  1.730
  1.740
Adjusted equity ratio
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360
  0.360

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,647
  1,962
  2,312
  2,697
  3,118
  3,572
  4,060
  4,581
  5,134
  5,718
  6,336
  6,981
  7,655
  8,359
  9,093
  9,858
  10,653
  11,480
  12,339
  13,232
  14,160
  15,125
  16,127
  17,170
  18,255
  19,385
  20,561
  21,787
  23,064
  24,397
Depreciation, amort., depletion, $m
  842
  1,016
  1,209
  1,423
  1,657
  1,910
  2,182
  2,473
  2,782
  3,109
  3,448
  3,810
  4,189
  4,584
  4,997
  5,427
  5,874
  6,340
  6,823
  7,325
  7,848
  8,390
  8,954
  9,541
  10,151
  10,786
  11,447
  12,136
  12,854
  13,603
Funds from operations, $m
  2,489
  2,977
  3,521
  4,120
  4,774
  5,482
  6,242
  7,054
  7,916
  8,827
  9,784
  10,790
  11,844
  12,944
  14,090
  15,285
  16,527
  17,819
  19,162
  20,557
  22,008
  23,515
  25,082
  26,711
  28,406
  30,171
  32,009
  33,923
  35,919
  38,000
Change in working capital, $m
  -679
  -768
  -857
  -945
  -1,033
  -1,120
  -1,204
  -1,287
  -1,368
  -1,447
  -1,524
  -1,600
  -1,675
  -1,750
  -1,826
  -1,902
  -1,979
  -2,057
  -2,139
  -2,222
  -2,309
  -2,400
  -2,495
  -2,595
  -2,699
  -2,809
  -2,925
  -3,047
  -3,176
  -3,311
Cash from operations, $m
  3,169
  3,745
  4,378
  5,066
  5,807
  6,602
  7,447
  8,341
  9,284
  10,273
  11,308
  12,391
  13,519
  14,694
  15,916
  17,186
  18,506
  19,877
  21,301
  22,780
  24,317
  25,915
  27,577
  29,306
  31,106
  32,980
  34,933
  36,970
  39,094
  41,311
Maintenance CAPEX, $m
  -683
  -836
  -1,010
  -1,204
  -1,417
  -1,651
  -1,904
  -2,176
  -2,467
  -2,776
  -3,104
  -3,448
  -3,810
  -4,189
  -4,584
  -4,997
  -5,427
  -5,874
  -6,340
  -6,823
  -7,325
  -7,848
  -8,390
  -8,954
  -9,541
  -10,151
  -10,786
  -11,447
  -12,136
  -12,854
New CAPEX, $m
  -1,996
  -2,256
  -2,517
  -2,778
  -3,037
  -3,291
  -3,540
  -3,783
  -4,020
  -4,252
  -4,479
  -4,703
  -4,924
  -5,145
  -5,366
  -5,589
  -5,815
  -6,047
  -6,285
  -6,532
  -6,788
  -7,054
  -7,333
  -7,626
  -7,933
  -8,256
  -8,597
  -8,955
  -9,334
  -9,733
Cash from investing activities, $m
  -2,679
  -3,092
  -3,527
  -3,982
  -4,454
  -4,942
  -5,444
  -5,959
  -6,487
  -7,028
  -7,583
  -8,151
  -8,734
  -9,334
  -9,950
  -10,586
  -11,242
  -11,921
  -12,625
  -13,355
  -14,113
  -14,902
  -15,723
  -16,580
  -17,474
  -18,407
  -19,383
  -20,402
  -21,470
  -22,587
Free cash flow, $m
  490
  652
  850
  1,084
  1,353
  1,660
  2,003
  2,382
  2,796
  3,245
  3,725
  4,240
  4,785
  5,361
  5,966
  6,600
  7,264
  7,955
  8,676
  9,425
  10,204
  11,013
  11,853
  12,726
  13,632
  14,573
  15,551
  16,567
  17,624
  18,724
Issuance/(repayment) of debt, $m
  2,066
  2,323
  2,592
  2,861
  3,127
  3,388
  3,644
  3,895
  4,139
  4,378
  4,612
  4,842
  5,070
  5,297
  5,525
  5,754
  5,988
  6,226
  6,472
  6,725
  6,989
  7,263
  7,551
  7,852
  8,168
  8,501
  8,851
  9,221
  9,610
  10,021
Issuance/(repurchase) of shares, $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 from financing (excl. dividends), $m  
  2,066
  2,323
  2,592
  2,861
  3,127
  3,388
  3,644
  3,895
  4,139
  4,378
  4,612
  4,842
  5,070
  5,297
  5,525
  5,754
  5,988
  6,226
  6,472
  6,725
  6,989
  7,263
  7,551
  7,852
  8,168
  8,501
  8,851
  9,221
  9,610
  10,021
Total cash flow (excl. dividends), $m
  2,556
  2,975
  3,442
  3,944
  4,480
  5,048
  5,647
  6,277
  6,935
  7,623
  8,337
  9,082
  9,855
  10,658
  11,491
  12,355
  13,251
  14,182
  15,147
  16,150
  17,193
  18,276
  19,404
  20,577
  21,800
  23,074
  24,402
  25,788
  27,234
  28,745
Retained Cash Flow (-), $m
  -1,154
  -1,307
  -1,458
  -1,609
  -1,759
  -1,906
  -2,050
  -2,191
  -2,328
  -2,462
  -2,594
  -2,724
  -2,852
  -2,980
  -3,108
  -3,237
  -3,368
  -3,502
  -3,640
  -3,783
  -3,931
  -4,086
  -4,247
  -4,417
  -4,595
  -4,782
  -4,979
  -5,187
  -5,406
  -5,637
Prev. year cash balance distribution, $m
  327
  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
  1,729
  1,669
  1,984
  2,335
  2,721
  3,142
  3,597
  4,086
  4,607
  5,160
  5,743
  6,358
  7,003
  7,678
  8,383
  9,118
  9,883
  10,679
  11,507
  12,367
  13,262
  14,191
  15,157
  16,161
  17,205
  18,292
  19,423
  20,601
  21,829
  23,108
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
  1,658
  1,528
  1,727
  1,923
  2,109
  2,281
  2,430
  2,554
  2,647
  2,705
  2,727
  2,713
  2,663
  2,578
  2,461
  2,317
  2,150
  1,967
  1,772
  1,572
  1,372
  1,177
  993
  823
  669
  534
  417
  319
  238
  174
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

Ryanair Holdings plc (Ryanair Holdings) is a holding company for Ryanair Limited (Ryanair). Ryanair operates an ultra-low fare, scheduled-passenger airline serving short-haul, point-to-point routes between Ireland, the United Kingdom, Continental Europe, Morocco and Israel. Ryanair provides various ancillary services and engages in other activities connected with its core air passenger service, including non-flight scheduled services, Internet-related services, and the in-flight sale of beverages, food and merchandise. Ryanair markets accommodation services and travel insurance through its Website. It provides hotel and accommodation services. Ryanair provides its own aircraft and passenger handling and ticketing services at Dublin Airport. As of June 30, 2016, Ryanair had a principal fleet of over 350 Boeing 737-800 aircraft and offered over 2,000 scheduled short-haul flights per day serving approximately 200 airports throughout Europe.

FINANCIAL RATIOS  of  Ryanair Holdings plc (RYAAY)

Valuation Ratios
P/E Ratio 61.3
Price to Sales 12.1
Price to Book 18.2
Price to Tangible Book
Price to Cash Flow 41.8
Price to Free Cash Flow 168.8
Growth Rates
Sales Growth Rate 1.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 19.1%
Cap. Spend. - 3 Yr. Gr. Rate 23.4%
Financial Strength
Quick Ratio 9
Current Ratio 0.1
LT Debt to Equity 88.8%
Total Debt to Equity 99.1%
Interest Coverage 0
Management Effectiveness
Return On Assets 11.3%
Ret/ On Assets - 3 Yr. Avg. 11%
Return On Total Capital 16%
Ret/ On T. Cap. - 3 Yr. Avg. 15.7%
Return On Equity 32.8%
Return On Equity - 3 Yr. Avg. 32.5%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 37.4%
Gross Margin - 3 Yr. Avg. 34.9%
EBITDA Margin 29.6%
EBITDA Margin - 3 Yr. Avg. 28.8%
Operating Margin 23.1%
Oper. Margin - 3 Yr. Avg. 21.3%
Pre-Tax Margin 22.1%
Pre-Tax Margin - 3 Yr. Avg. 21.9%
Net Profit Margin 19.8%
Net Profit Margin - 3 Yr. Avg. 19.7%
Effective Tax Rate 10.5%
Eff/ Tax Rate - 3 Yr. Avg. 10.6%
Payout Ratio 0%

RYAAY stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the RYAAY stock intrinsic value calculation we used $8753 million for the last fiscal year's total revenue generated by Ryanair Holdings plc. The default revenue input number comes from 0001 income statement of Ryanair Holdings plc. 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 RYAAY stock valuation model: a) initial revenue growth rate of 22.5% 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 4.3%, whose default value for RYAAY is calculated based on our internal credit rating of Ryanair Holdings plc, 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 Ryanair Holdings plc.
    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 RYAAY stock the variable cost ratio is equal to 75.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $97 million in the base year in the intrinsic value calculation for RYAAY 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 Ryanair Holdings plc.

Corporate tax rate of 27% is the nominal tax rate for Ryanair Holdings plc. 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 RYAAY 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 RYAAY are equal to 101.4%.

Life of production assets of 13 years is the average useful life of capital assets used in Ryanair Holdings plc 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 RYAAY is equal to -34.5%. 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 - $5469.88984088 million for Ryanair Holdings plc - 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 226.688 million for Ryanair Holdings plc 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 Ryanair Holdings plc at the current share price and the inputted number of shares is $15.8 billion.

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