Intrinsic value of SPI Energy - SPI

Previous Close

$0.26

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$0.26

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of SPI 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 0.2

 

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, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  143
  146
  150
  154
  159
  164
  170
  176
  182
  189
  197
  205
  213
  222
  232
  242
  253
  264
  276
  289
  302
  316
  331
  347
  363
  381
  399
  418
  439
  460
Variable operating expenses, $m
  53
  54
  56
  57
  59
  61
  63
  65
  67
  70
  71
  74
  77
  80
  83
  87
  91
  95
  99
  104
  109
  114
  119
  125
  131
  137
  144
  151
  158
  166
Fixed operating expenses, $m
  296
  303
  310
  316
  323
  330
  338
  345
  353
  361
  368
  377
  385
  393
  402
  411
  420
  429
  438
  448
  458
  468
  478
  489
  500
  511
  522
  533
  545
  557
Total operating expenses, $m
  349
  357
  366
  373
  382
  391
  401
  410
  420
  431
  439
  451
  462
  473
  485
  498
  511
  524
  537
  552
  567
  582
  597
  614
  631
  648
  666
  684
  703
  723
Operating income, $m
  -206
  -211
  -215
  -219
  -223
  -227
  -231
  -234
  -238
  -241
  -243
  -246
  -248
  -251
  -254
  -256
  -258
  -260
  -262
  -263
  -265
  -266
  -266
  -267
  -267
  -267
  -267
  -266
  -264
  -263
EBITDA, $m
  -200
  -204
  -208
  -212
  -216
  -219
  -223
  -226
  -229
  -232
  -235
  -238
  -240
  -243
  -245
  -247
  -249
  -250
  -251
  -253
  -253
  -254
  -254
  -254
  -254
  -253
  -252
  -250
  -248
  -246
Interest expense (income), $m
  6
  10
  8
  8
  9
  9
  10
  10
  11
  12
  13
  13
  14
  15
  16
  18
  19
  20
  21
  23
  24
  26
  28
  29
  31
  33
  35
  38
  40
  42
  45
Earnings before tax, $m
  -216
  -218
  -223
  -228
  -232
  -237
  -241
  -245
  -249
  -254
  -256
  -260
  -264
  -268
  -271
  -275
  -278
  -282
  -285
  -288
  -291
  -293
  -296
  -298
  -300
  -302
  -304
  -306
  -307
  -308
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
  -216
  -218
  -223
  -228
  -232
  -237
  -241
  -245
  -249
  -254
  -256
  -260
  -264
  -268
  -271
  -275
  -278
  -282
  -285
  -288
  -291
  -293
  -296
  -298
  -300
  -302
  -304
  -306
  -307
  -308

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
  370
  378
  388
  399
  411
  424
  438
  454
  471
  489
  508
  529
  551
  574
  599
  625
  653
  682
  713
  746
  781
  817
  856
  896
  939
  984
  1,031
  1,081
  1,133
  1,188
Adjusted assets (=assets-cash), $m
  370
  378
  388
  399
  411
  424
  438
  454
  471
  489
  508
  529
  551
  574
  599
  625
  653
  682
  713
  746
  781
  817
  856
  896
  939
  984
  1,031
  1,081
  1,133
  1,188
Revenue / Adjusted assets
  0.386
  0.386
  0.387
  0.386
  0.387
  0.387
  0.388
  0.388
  0.386
  0.387
  0.388
  0.388
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
  0.387
Average production assets, $m
  160
  164
  168
  173
  178
  184
  190
  197
  204
  212
  221
  230
  239
  249
  260
  271
  284
  296
  310
  324
  339
  355
  372
  389
  408
  427
  448
  469
  492
  516
Working capital, $m
  -47
  -48
  -49
  -50
  -52
  -53
  -55
  -57
  -59
  -62
  -64
  -67
  -70
  -72
  -76
  -79
  -82
  -86
  -90
  -94
  -99
  -103
  -108
  -113
  -118
  -124
  -130
  -136
  -143
  -150
Total debt, $m
  142
  150
  159
  168
  179
  191
  204
  218
  233
  250
  267
  286
  305
  326
  349
  372
  397
  424
  452
  481
  512
  545
  580
  616
  655
  695
  738
  782
  830
  879
Total liabilities, $m
  333
  340
  349
  359
  370
  382
  395
  409
  424
  440
  457
  476
  496
  517
  539
  563
  588
  614
  642
  672
  703
  736
  770
  807
  845
  886
  928
  973
  1,020
  1,070
Total equity, $m
  37
  38
  39
  40
  41
  42
  44
  45
  47
  49
  51
  53
  55
  57
  60
  63
  65
  68
  71
  75
  78
  82
  86
  90
  94
  98
  103
  108
  113
  119
Total liabilities and equity, $m
  370
  378
  388
  399
  411
  424
  439
  454
  471
  489
  508
  529
  551
  574
  599
  626
  653
  682
  713
  747
  781
  818
  856
  897
  939
  984
  1,031
  1,081
  1,133
  1,189
Debt-to-equity ratio
  3.850
  3.960
  4.090
  4.220
  4.360
  4.510
  4.660
  4.810
  4.960
  5.110
  5.250
  5.400
  5.540
  5.680
  5.820
  5.960
  6.080
  6.210
  6.330
  6.450
  6.560
  6.670
  6.780
  6.880
  6.970
  7.070
  7.150
  7.240
  7.320
  7.400
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
  -216
  -218
  -223
  -228
  -232
  -237
  -241
  -245
  -249
  -254
  -256
  -260
  -264
  -268
  -271
  -275
  -278
  -282
  -285
  -288
  -291
  -293
  -296
  -298
  -300
  -302
  -304
  -306
  -307
  -308
Depreciation, amort., depletion, $m
  7
  7
  7
  7
  7
  8
  8
  8
  8
  9
  7
  8
  8
  8
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  14
  14
  15
  16
  16
  17
Funds from operations, $m
  -209
  -212
  -216
  -220
  -225
  -229
  -233
  -237
  -241
  -245
  -249
  -252
  -256
  -259
  -263
  -266
  -269
  -272
  -274
  -277
  -279
  -282
  -284
  -285
  -287
  -288
  -289
  -290
  -290
  -290
Change in working capital, $m
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
Cash from operations, $m
  -209
  -210
  -215
  -219
  -223
  -227
  -231
  -235
  -239
  -243
  -246
  -250
  -253
  -256
  -259
  -262
  -265
  -268
  -270
  -273
  -275
  -277
  -279
  -280
  -281
  -282
  -283
  -284
  -284
  -283
Maintenance CAPEX, $m
  -5
  -5
  -5
  -6
  -6
  -6
  -6
  -6
  -7
  -7
  -7
  -7
  -8
  -8
  -8
  -9
  -9
  -9
  -10
  -10
  -11
  -11
  -12
  -12
  -13
  -14
  -14
  -15
  -16
  -16
New CAPEX, $m
  -3
  -4
  -4
  -5
  -5
  -6
  -6
  -7
  -7
  -8
  -8
  -9
  -10
  -10
  -11
  -11
  -12
  -13
  -13
  -14
  -15
  -16
  -17
  -18
  -19
  -20
  -21
  -22
  -23
  -24
Cash from investing activities, $m
  -8
  -9
  -9
  -11
  -11
  -12
  -12
  -13
  -14
  -15
  -15
  -16
  -18
  -18
  -19
  -20
  -21
  -22
  -23
  -24
  -26
  -27
  -29
  -30
  -32
  -34
  -35
  -37
  -39
  -40
Free cash flow, $m
  -217
  -219
  -224
  -229
  -234
  -239
  -244
  -248
  -253
  -257
  -262
  -266
  -270
  -274
  -279
  -282
  -286
  -290
  -294
  -297
  -301
  -304
  -307
  -310
  -313
  -316
  -318
  -320
  -322
  -324
Issuance/(repayment) of debt, $m
  -42
  8
  9
  10
  11
  12
  13
  14
  15
  16
  17
  19
  20
  21
  22
  24
  25
  26
  28
  30
  31
  33
  35
  36
  38
  40
  43
  45
  47
  50
Issuance/(repurchase) of shares, $m
  266
  219
  224
  229
  233
  238
  242
  247
  251
  255
  258
  262
  266
  270
  274
  277
  281
  284
  288
  291
  294
  297
  300
  302
  305
  307
  309
  311
  312
  313
Cash from financing (excl. dividends), $m  
  224
  227
  233
  239
  244
  250
  255
  261
  266
  271
  275
  281
  286
  291
  296
  301
  306
  310
  316
  321
  325
  330
  335
  338
  343
  347
  352
  356
  359
  363
Total cash flow (excl. dividends), $m
  7
  8
  8
  9
  10
  11
  12
  13
  13
  14
  14
  15
  16
  16
  17
  19
  20
  21
  22
  23
  24
  26
  27
  29
  30
  32
  33
  35
  37
  39
Retained Cash Flow (-), $m
  -266
  -219
  -224
  -229
  -233
  -238
  -242
  -247
  -251
  -255
  -258
  -262
  -266
  -270
  -274
  -277
  -281
  -284
  -288
  -291
  -294
  -297
  -300
  -302
  -305
  -307
  -309
  -311
  -312
  -313
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
  -259
  -212
  -216
  -220
  -223
  -227
  -231
  -234
  -238
  -241
  -244
  -247
  -251
  -253
  -256
  -259
  -261
  -264
  -266
  -268
  -270
  -271
  -273
  -274
  -275
  -275
  -275
  -275
  -275
  -274
Discount rate, %
  15.40
  16.17
  16.98
  17.83
  18.72
  19.65
  20.64
  21.67
  22.75
  23.89
  25.08
  26.34
  27.66
  29.04
  30.49
  32.02
  33.62
  35.30
  37.06
  38.92
  40.86
  42.90
  45.05
  47.30
  49.67
  52.15
  54.76
  57.50
  60.37
  63.39
PV of cash for distribution, $m
  -225
  -157
  -135
  -114
  -95
  -77
  -62
  -49
  -38
  -28
  -21
  -15
  -10
  -7
  -5
  -3
  -2
  -1
  -1
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  50.0
  7.2
  1.0
  0.2
  0.0
  0.0
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SPI Energy Co., Ltd. provides photovoltaic (PV) solutions for business, residential, government and utility customers and investors. The Company operates through solar energy products and services segment. The types of products and services in segment includes engineering, procurement and construction (EPC) services, sales of PV solar system, electricity revenue under power purchase agreements, trading of PV solar components, pre-development project sales and financial service revenue. It provides a spectrum of EPC services to third-party project developers, and develops, owns and operates solar projects that sell electricity to the grid in countries, including China, the United States, the United Kingdom, Greece, Japan and Italy. The Solar projects in its portfolio include projects at all stages of development, including projects in operation, projects under construction and projects in pipeline. Its www.solarbao.com (Solarbao) is an online energy e-commerce and investment platform.

FINANCIAL RATIOS  of  SPI Energy (SPI)

Valuation Ratios
P/E Ratio -0.8
Price to Sales 1.2
Price to Book -9.8
Price to Tangible Book
Price to Cash Flow -3.5
Price to Free Cash Flow -2
Growth Rates
Sales Growth Rate -26.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -22.2%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio 0
Current Ratio 0.1
LT Debt to Equity -211.8%
Total Debt to Equity -1082.4%
Interest Coverage -36
Management Effectiveness
Return On Assets -40.1%
Ret/ On Assets - 3 Yr. Avg. -23.2%
Return On Total Capital -68.8%
Ret/ On T. Cap. - 3 Yr. Avg. -38.2%
Return On Equity -225.5%
Return On Equity - 3 Yr. Avg. -102.4%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 13.6%
Gross Margin - 3 Yr. Avg. 10.3%
EBITDA Margin -149.3%
EBITDA Margin - 3 Yr. Avg. -80.3%
Operating Margin -142.9%
Oper. Margin - 3 Yr. Avg. -77.7%
Pre-Tax Margin -157.9%
Pre-Tax Margin - 3 Yr. Avg. -85.5%
Net Profit Margin -157.9%
Net Profit Margin - 3 Yr. Avg. -86.7%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. -50.2%
Payout Ratio 0%

SPI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SPI stock intrinsic value calculation we used $140.199 million for the last fiscal year's total revenue generated by SPI Energy. The default revenue input number comes from 0001 income statement of SPI Energy. 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 SPI stock valuation model: a) initial revenue growth rate of 2% 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 15.4%, whose default value for SPI is calculated based on our internal credit rating of SPI Energy, 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 SPI Energy.
    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 SPI stock the variable cost ratio is equal to 37.1%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $290 million in the base year in the intrinsic value calculation for SPI 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 SPI Energy.

Corporate tax rate of 27% is the nominal tax rate for SPI Energy. 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 SPI 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 SPI are equal to 112.2%.

Life of production assets of 35.7 years is the average useful life of capital assets used in SPI Energy 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 SPI is equal to -32.6%. 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 - $-12.928 million for SPI Energy - 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 725.067 million for SPI Energy 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 SPI Energy at the current share price and the inputted number of shares is $0.2 billion.

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COMPANY NEWS

▶ SPI Energy Co., Ltd. Provides Update on Nasdaq Matters   [Oct-05-18 06:50AM  GlobeNewswire]
▶ SPI Energy Co., Ltd. Announces Management and Board Changes   [Aug-23-18 09:40AM  GlobeNewswire]
▶ Nasdaq Scheduled Resumption in SPI Energy Co., Ltd.   [May-07-18 03:00PM  GlobeNewswire]
▶ Nasdaq Halts SPI Energy Co., Ltd.   [03:12PM  GlobeNewswire]
▶ SPI Energy Co., Ltd. Launched Global Miner Hosting   [Mar-29-18 08:00AM  GlobeNewswire]
▶ SPI Energy's Strategic Partnership   [Jan-18-18 11:38AM  GuruFocus.com]

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