Intrinsic value of SK Telecom ADR - SKM

Previous Close

$26.54

  Intrinsic Value

$125.93

stock screener

  Rating & Target

str. buy

+374%

Previous close

$26.54

 
Intrinsic value

$125.93

 
Up/down potential

+374%

 
Rating

str. buy

We calculate the intrinsic value of SKM 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 2.1

 

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, %
  15.80
  14.72
  13.75
  12.87
  12.09
  11.38
  10.74
  10.17
  9.65
  9.18
  8.77
  8.39
  8.05
  7.75
  7.47
  7.22
  7.00
  6.80
  6.62
  6.46
  6.31
  6.18
  6.06
  5.96
  5.86
  5.78
  5.70
  5.63
  5.57
  5.51
Revenue, $m
  19,069
  21,876
  24,883
  28,086
  31,481
  35,062
  38,828
  42,775
  46,902
  51,210
  55,699
  60,371
  65,231
  70,284
  75,534
  80,991
  86,661
  92,555
  98,683
  105,057
  111,689
  118,594
  125,785
  133,278
  141,090
  149,238
  157,742
  166,619
  175,892
  185,582
Variable operating expenses, $m
  17,538
  20,043
  22,728
  25,587
  28,617
  31,815
  35,176
  38,699
  42,384
  46,229
  49,720
  53,891
  58,229
  62,739
  67,426
  72,297
  77,358
  82,620
  88,090
  93,780
  99,700
  105,863
  112,282
  118,971
  125,944
  133,218
  140,809
  148,733
  157,011
  165,660
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
  17,538
  20,043
  22,728
  25,587
  28,617
  31,815
  35,176
  38,699
  42,384
  46,229
  49,720
  53,891
  58,229
  62,739
  67,426
  72,297
  77,358
  82,620
  88,090
  93,780
  99,700
  105,863
  112,282
  118,971
  125,944
  133,218
  140,809
  148,733
  157,011
  165,660
Operating income, $m
  1,531
  1,832
  2,155
  2,499
  2,863
  3,248
  3,652
  4,076
  4,519
  4,981
  5,979
  6,481
  7,002
  7,545
  8,108
  8,694
  9,303
  9,935
  10,593
  11,278
  11,989
  12,731
  13,503
  14,307
  15,146
  16,020
  16,933
  17,886
  18,881
  19,922
EBITDA, $m
  4,717
  5,411
  6,155
  6,947
  7,787
  8,673
  9,604
  10,580
  11,601
  12,667
  13,777
  14,933
  16,135
  17,384
  18,683
  20,033
  21,435
  22,893
  24,409
  25,986
  27,626
  29,334
  31,112
  32,966
  34,898
  36,914
  39,017
  41,213
  43,506
  45,903
Interest expense (income), $m
  226
  434
  577
  730
  893
  1,068
  1,253
  1,448
  1,653
  1,867
  2,092
  2,327
  2,571
  2,825
  3,090
  3,365
  3,651
  3,948
  4,257
  4,578
  4,911
  5,258
  5,619
  5,995
  6,387
  6,795
  7,220
  7,664
  8,126
  8,610
  9,115
Earnings before tax, $m
  1,096
  1,255
  1,425
  1,605
  1,795
  1,995
  2,204
  2,423
  2,651
  2,889
  3,652
  3,910
  4,177
  4,455
  4,743
  5,043
  5,355
  5,679
  6,016
  6,366
  6,731
  7,111
  7,507
  7,920
  8,351
  8,800
  9,270
  9,760
  10,272
  10,807
Tax expense, $m
  296
  339
  385
  433
  485
  539
  595
  654
  716
  780
  986
  1,056
  1,128
  1,203
  1,281
  1,362
  1,446
  1,533
  1,624
  1,719
  1,817
  1,920
  2,027
  2,138
  2,255
  2,376
  2,503
  2,635
  2,773
  2,918
Net income, $m
  800
  916
  1,040
  1,172
  1,311
  1,456
  1,609
  1,769
  1,935
  2,109
  2,666
  2,854
  3,049
  3,252
  3,463
  3,681
  3,909
  4,146
  4,391
  4,647
  4,914
  5,191
  5,480
  5,782
  6,096
  6,424
  6,767
  7,124
  7,498
  7,889

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
  36,321
  41,668
  47,396
  53,497
  59,963
  66,785
  73,958
  81,476
  89,338
  97,543
  106,093
  114,993
  124,250
  133,874
  143,875
  154,268
  165,069
  176,295
  187,968
  200,109
  212,742
  225,893
  239,590
  253,863
  268,743
  284,264
  300,460
  317,370
  335,033
  353,489
Adjusted assets (=assets-cash), $m
  36,321
  41,668
  47,396
  53,497
  59,963
  66,785
  73,958
  81,476
  89,338
  97,543
  106,093
  114,993
  124,250
  133,874
  143,875
  154,268
  165,069
  176,295
  187,968
  200,109
  212,742
  225,893
  239,590
  253,863
  268,743
  284,264
  300,460
  317,370
  335,033
  353,489
Revenue / Adjusted assets
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
  0.525
Average production assets, $m
  13,348
  15,313
  17,418
  19,660
  22,036
  24,544
  27,179
  29,942
  32,832
  35,847
  38,989
  42,260
  45,662
  49,199
  52,874
  56,694
  60,663
  64,789
  69,078
  73,540
  78,183
  83,016
  88,049
  93,295
  98,763
  104,467
  110,419
  116,634
  123,125
  129,907
Working capital, $m
  -1,659
  -1,903
  -2,165
  -2,443
  -2,739
  -3,050
  -3,378
  -3,721
  -4,080
  -4,455
  -4,846
  -5,252
  -5,675
  -6,115
  -6,571
  -7,046
  -7,540
  -8,052
  -8,585
  -9,140
  -9,717
  -10,318
  -10,943
  -11,595
  -12,275
  -12,984
  -13,724
  -14,496
  -15,303
  -16,146
Total debt, $m
  9,304
  11,769
  14,409
  17,222
  20,203
  23,348
  26,654
  30,120
  33,745
  37,527
  41,469
  45,572
  49,839
  54,276
  58,886
  63,677
  68,657
  73,832
  79,213
  84,810
  90,634
  96,696
  103,011
  109,591
  116,450
  123,605
  131,072
  138,868
  147,010
  155,518
Total liabilities, $m
  16,744
  19,209
  21,850
  24,662
  27,643
  30,788
  34,095
  37,560
  41,185
  44,967
  48,909
  53,012
  57,279
  61,716
  66,326
  71,118
  76,097
  81,272
  86,653
  92,250
  98,074
  104,137
  110,451
  117,031
  123,890
  131,046
  138,512
  146,308
  154,450
  162,958
Total equity, $m
  19,577
  22,459
  25,546
  28,835
  32,320
  35,997
  39,863
  43,916
  48,153
  52,575
  57,184
  61,981
  66,971
  72,158
  77,549
  83,151
  88,972
  95,023
  101,315
  107,859
  114,668
  121,756
  129,139
  136,832
  144,852
  153,218
  161,948
  171,063
  180,583
  190,530
Total liabilities and equity, $m
  36,321
  41,668
  47,396
  53,497
  59,963
  66,785
  73,958
  81,476
  89,338
  97,542
  106,093
  114,993
  124,250
  133,874
  143,875
  154,269
  165,069
  176,295
  187,968
  200,109
  212,742
  225,893
  239,590
  253,863
  268,742
  284,264
  300,460
  317,371
  335,033
  353,488
Debt-to-equity ratio
  0.480
  0.520
  0.560
  0.600
  0.630
  0.650
  0.670
  0.690
  0.700
  0.710
  0.730
  0.740
  0.740
  0.750
  0.760
  0.770
  0.770
  0.780
  0.780
  0.790
  0.790
  0.790
  0.800
  0.800
  0.800
  0.810
  0.810
  0.810
  0.810
  0.820
Adjusted equity ratio
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539
  0.539

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  800
  916
  1,040
  1,172
  1,311
  1,456
  1,609
  1,769
  1,935
  2,109
  2,666
  2,854
  3,049
  3,252
  3,463
  3,681
  3,909
  4,146
  4,391
  4,647
  4,914
  5,191
  5,480
  5,782
  6,096
  6,424
  6,767
  7,124
  7,498
  7,889
Depreciation, amort., depletion, $m
  3,186
  3,579
  4,000
  4,448
  4,923
  5,425
  5,952
  6,505
  7,083
  7,686
  7,798
  8,452
  9,132
  9,840
  10,575
  11,339
  12,133
  12,958
  13,816
  14,708
  15,637
  16,603
  17,610
  18,659
  19,753
  20,893
  22,084
  23,327
  24,625
  25,981
Funds from operations, $m
  3,986
  4,495
  5,040
  5,620
  6,234
  6,881
  7,561
  8,273
  9,018
  9,794
  10,464
  11,306
  12,182
  13,092
  14,037
  15,020
  16,042
  17,103
  18,207
  19,355
  20,550
  21,794
  23,090
  24,441
  25,849
  27,318
  28,851
  30,451
  32,123
  33,870
Change in working capital, $m
  -226
  -244
  -262
  -279
  -295
  -312
  -328
  -343
  -359
  -375
  -391
  -407
  -423
  -440
  -457
  -475
  -493
  -513
  -533
  -555
  -577
  -601
  -626
  -652
  -680
  -709
  -740
  -772
  -807
  -843
Cash from operations, $m
  4,212
  4,739
  5,302
  5,899
  6,529
  7,193
  7,889
  8,617
  9,377
  10,169
  10,855
  11,713
  12,604
  13,531
  14,494
  15,495
  16,535
  17,616
  18,740
  19,910
  21,127
  22,395
  23,716
  25,093
  26,528
  28,027
  29,590
  31,224
  32,930
  34,713
Maintenance CAPEX, $m
  -2,306
  -2,670
  -3,063
  -3,484
  -3,932
  -4,407
  -4,909
  -5,436
  -5,988
  -6,566
  -7,169
  -7,798
  -8,452
  -9,132
  -9,840
  -10,575
  -11,339
  -12,133
  -12,958
  -13,816
  -14,708
  -15,637
  -16,603
  -17,610
  -18,659
  -19,753
  -20,893
  -22,084
  -23,327
  -24,625
New CAPEX, $m
  -1,816
  -1,965
  -2,105
  -2,242
  -2,376
  -2,507
  -2,636
  -2,763
  -2,889
  -3,015
  -3,142
  -3,271
  -3,402
  -3,537
  -3,675
  -3,819
  -3,969
  -4,126
  -4,290
  -4,462
  -4,643
  -4,833
  -5,034
  -5,245
  -5,468
  -5,704
  -5,952
  -6,214
  -6,491
  -6,783
Cash from investing activities, $m
  -4,122
  -4,635
  -5,168
  -5,726
  -6,308
  -6,914
  -7,545
  -8,199
  -8,877
  -9,581
  -10,311
  -11,069
  -11,854
  -12,669
  -13,515
  -14,394
  -15,308
  -16,259
  -17,248
  -18,278
  -19,351
  -20,470
  -21,637
  -22,855
  -24,127
  -25,457
  -26,845
  -28,298
  -29,818
  -31,408
Free cash flow, $m
  90
  105
  134
  173
  221
  278
  344
  418
  499
  588
  543
  644
  750
  862
  979
  1,101
  1,227
  1,358
  1,493
  1,633
  1,777
  1,926
  2,079
  2,238
  2,401
  2,570
  2,745
  2,925
  3,112
  3,306
Issuance/(repayment) of debt, $m
  2,297
  2,465
  2,641
  2,813
  2,981
  3,145
  3,306
  3,466
  3,624
  3,782
  3,942
  4,103
  4,268
  4,436
  4,611
  4,791
  4,979
  5,175
  5,381
  5,597
  5,824
  6,063
  6,314
  6,580
  6,860
  7,155
  7,467
  7,795
  8,142
  8,508
Issuance/(repurchase) of shares, $m
  1,862
  1,965
  2,047
  2,117
  2,174
  2,221
  2,257
  2,284
  2,302
  2,314
  1,942
  1,943
  1,940
  1,935
  1,928
  1,920
  1,913
  1,906
  1,900
  1,896
  1,895
  1,897
  1,902
  1,911
  1,924
  1,941
  1,963
  1,990
  2,022
  2,059
Cash from financing (excl. dividends), $m  
  4,159
  4,430
  4,688
  4,930
  5,155
  5,366
  5,563
  5,750
  5,926
  6,096
  5,884
  6,046
  6,208
  6,371
  6,539
  6,711
  6,892
  7,081
  7,281
  7,493
  7,719
  7,960
  8,216
  8,491
  8,784
  9,096
  9,430
  9,785
  10,164
  10,567
Total cash flow (excl. dividends), $m
  4,249
  4,535
  4,822
  5,102
  5,376
  5,644
  5,908
  6,167
  6,426
  6,684
  6,427
  6,690
  6,958
  7,234
  7,518
  7,812
  8,119
  8,439
  8,774
  9,126
  9,496
  9,885
  10,296
  10,729
  11,185
  11,667
  12,175
  12,711
  13,276
  13,873
Retained Cash Flow (-), $m
  -2,663
  -2,882
  -3,088
  -3,289
  -3,485
  -3,677
  -3,866
  -4,052
  -4,237
  -4,422
  -4,609
  -4,797
  -4,990
  -5,187
  -5,391
  -5,602
  -5,822
  -6,051
  -6,292
  -6,544
  -6,809
  -7,088
  -7,383
  -7,693
  -8,020
  -8,366
  -8,730
  -9,114
  -9,520
  -9,948
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
  1,586
  1,653
  1,734
  1,814
  1,891
  1,967
  2,042
  2,115
  2,188
  2,261
  1,818
  1,893
  1,969
  2,047
  2,127
  2,210
  2,297
  2,388
  2,482
  2,582
  2,687
  2,797
  2,913
  3,035
  3,165
  3,301
  3,445
  3,596
  3,756
  3,925
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
  1,521
  1,513
  1,509
  1,493
  1,466
  1,428
  1,379
  1,322
  1,257
  1,185
  864
  808
  749
  687
  624
  562
  500
  440
  382
  328
  278
  232
  191
  155
  123
  96
  74
  56
  41
  30
Current shareholders' claim on cash, %
  86.4
  75.6
  66.9
  59.8
  54.0
  49.1
  45.1
  41.7
  38.8
  36.3
  34.5
  32.9
  31.5
  30.2
  29.1
  28.1
  27.2
  26.4
  25.7
  25.0
  24.4
  23.8
  23.3
  22.8
  22.4
  22.0
  21.6
  21.2
  20.8
  20.5

SK Telecom Co., Ltd. provides wireless telecommunications in Korea. The Company is engaged in the commercial development and implementation of wireless and fixed-line technologies and services, as well as develop its platforms, including Internet of things (IoT) solutions, lifestyle enhancement and advanced media. It operates through three segments: cellular services, which include wireless voice and data transmission services, sales of wireless devices, IoT solutions platform services and lifestyle enhancement platform services; fixed-line telecommunication services, which include fixed-line telephone services, broadband Internet services, advanced media platform services (including Internet Protocol television (IPTV)) and business communications services, and other businesses, which include its commerce business, its hardware business and other operations. Its brands include SK Telecom, T-Roaming, 7Mobile, B phone, 00700, B tv, Syrup, UO Smart Beam Laser, Astell&Kern and Nate.

FINANCIAL RATIOS  of  SK Telecom ADR (SKM)

Valuation Ratios
P/E Ratio 1.3
Price to Sales 0.1
Price to Book 0.1
Price to Tangible Book
Price to Cash Flow 0.5
Price to Free Cash Flow 1.9
Growth Rates
Sales Growth Rate -0.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 19.9%
Cap. Spend. - 3 Yr. Gr. Rate 0%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 40.6%
Total Debt to Equity 46.1%
Interest Coverage 9
Management Effectiveness
Return On Assets 6.3%
Ret/ On Assets - 3 Yr. Avg. 6.6%
Return On Total Capital 7.3%
Ret/ On T. Cap. - 3 Yr. Avg. 7.6%
Return On Equity 10.7%
Return On Equity - 3 Yr. Avg. 11.3%
Asset Turnover 0.6
Profitability Ratios
Gross Margin 94.4%
Gross Margin - 3 Yr. Avg. 94.3%
EBITDA Margin 31.8%
EBITDA Margin - 3 Yr. Avg. 31.5%
Operating Margin 8.8%
Oper. Margin - 3 Yr. Avg. 9.3%
Pre-Tax Margin 12.3%
Pre-Tax Margin - 3 Yr. Avg. 12.4%
Net Profit Margin 9.8%
Net Profit Margin - 3 Yr. Avg. 9.7%
Effective Tax Rate 20.8%
Eff/ Tax Rate - 3 Yr. Avg. 22.2%
Payout Ratio 42.1%

SKM stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SKM stock intrinsic value calculation we used $16466.8449198 million for the last fiscal year's total revenue generated by SK Telecom ADR. The default revenue input number comes from 0001 income statement of SK Telecom 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 SKM stock valuation model: a) initial revenue growth rate of 15.8% 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 SKM is calculated based on our internal credit rating of SK Telecom 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 SK Telecom 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 SKM stock the variable cost ratio is equal to 92.4%.

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 SKM 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 6.2% for SK Telecom ADR.

Corporate tax rate of 27% is the nominal tax rate for SK Telecom 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 SKM 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 SKM are equal to 70%.

Life of production assets of 0 years is the average useful life of capital assets used in SK Telecom 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 SKM is equal to -8.7%. 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 - $16914.5276292 million for SK Telecom 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 79.644 million for SK Telecom 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 SK Telecom ADR at the current share price and the inputted number of shares is $2.1 billion.

RELATED COMPANIES Price Int.Val. Rating
KT KT ADR 14.46 52.35  str.buy
TLK Telekomunikasi 25.95 675.79  str.buy
CHT Chunghwa Telec 34.49 207.30  str.buy
VZ Verizon Commun 58.94 66.50  buy

COMPANY NEWS

▶ 5 Undervalued Companies Growing Earnings   [Oct-23-18 01:35PM  GuruFocus.com]
▶ 5 Stocks Jeremy Grantham Keeps Buying   [Sep-24-18 01:40PM  GuruFocus.com]
▶ The Best Bargain in Wireless Communications   [Sep-07-18 01:50PM  GuruFocus.com]
▶ 20 Stocks With Renewed Bull Cases After Trump-Kim Summit   [Jun-13-18 03:23PM  InvestorPlace]
▶ [$$] SK Telecom and Macquarie to Buy Carlyle-Backed ADT Caps   [May-08-18 02:24PM  The Wall Street Journal]
▶ SK Telecom Co. Ltd. Files Its Annual Report on Form 20-F   [Apr-27-18 09:00AM  PR Newswire]
▶ SK Telecom Earns RS Rating Upgrade   [Jan-08-18 03:00AM  Investor's Business Daily]
▶ 5 Undervalued Stocks With Growing Book Value   [Dec-19-17 11:00AM  GuruFocus.com]
▶ Stocks With Rising Relative Price Strength: SK Telecom   [03:00AM  Investor's Business Daily]
▶ Top Ranked Value Stocks to Buy for December 13th   [Dec-13-17 03:50PM  InvestorPlace]
▶ Stocks With Rising Relative Price Strength: SK Telecom   [Dec-06-17 03:00AM  Investor's Business Daily]
▶ 7 Low Price-to-Sales Stocks Worth Buying   [Aug-25-17 09:15AM  Zacks]
▶ SK Telecom Co. Ltd. Files its Annual Report on Form 20-F   [Apr-27-17 07:07AM  PR Newswire]

CONTACT US       ASSET ALLOCATION

About X-FIN       Site news       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2018. All rigths reserved.