Intrinsic value of Bio-Techne Corp - TECH

Previous Close

$196.75

  Intrinsic Value

$6.18

stock screener

  Rating & Target

str. sell

-97%

Previous close

$196.75

 
Intrinsic value

$6.18

 
Up/down potential

-97%

 
Rating

str. sell

We calculate the intrinsic value of TECH 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 7.4

 

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, %
  13.20
  12.38
  11.64
  10.98
  10.38
  9.84
  9.36
  8.92
  8.53
  8.18
  7.86
  7.57
  7.32
  7.08
  6.88
  6.69
  6.52
  6.37
  6.23
  6.11
  6.00
  5.90
  5.81
  5.73
  5.65
  5.59
  5.53
  5.48
  5.43
  5.39
Revenue, $m
  728
  818
  913
  1,013
  1,119
  1,229
  1,344
  1,464
  1,588
  1,718
  1,853
  1,994
  2,140
  2,291
  2,449
  2,613
  2,783
  2,960
  3,145
  3,337
  3,537
  3,745
  3,963
  4,190
  4,427
  4,674
  4,932
  5,203
  5,485
  5,780
Variable operating expenses, $m
  569
  638
  711
  787
  867
  951
  1,039
  1,130
  1,226
  1,325
  1,413
  1,520
  1,631
  1,747
  1,867
  1,992
  2,122
  2,257
  2,398
  2,544
  2,697
  2,856
  3,021
  3,194
  3,375
  3,564
  3,761
  3,967
  4,182
  4,407
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
  569
  638
  711
  787
  867
  951
  1,039
  1,130
  1,226
  1,325
  1,413
  1,520
  1,631
  1,747
  1,867
  1,992
  2,122
  2,257
  2,398
  2,544
  2,697
  2,856
  3,021
  3,194
  3,375
  3,564
  3,761
  3,967
  4,182
  4,407
Operating income, $m
  158
  180
  202
  226
  251
  277
  305
  333
  363
  394
  440
  474
  508
  544
  582
  621
  661
  703
  747
  793
  840
  890
  941
  995
  1,052
  1,110
  1,172
  1,236
  1,303
  1,373
EBITDA, $m
  214
  240
  268
  298
  328
  361
  394
  430
  466
  504
  544
  585
  628
  673
  719
  767
  817
  869
  923
  979
  1,038
  1,099
  1,163
  1,230
  1,299
  1,372
  1,448
  1,527
  1,610
  1,697
Interest expense (income), $m
  7
  18
  22
  26
  30
  34
  39
  44
  49
  54
  59
  65
  71
  77
  83
  90
  96
  103
  111
  118
  126
  135
  143
  152
  162
  172
  182
  193
  204
  215
  228
Earnings before tax, $m
  140
  158
  177
  196
  217
  238
  261
  285
  309
  334
  375
  403
  432
  461
  492
  524
  558
  592
  628
  666
  705
  746
  789
  833
  880
  928
  979
  1,032
  1,088
  1,146
Tax expense, $m
  38
  43
  48
  53
  59
  64
  70
  77
  83
  90
  101
  109
  117
  125
  133
  142
  151
  160
  170
  180
  190
  201
  213
  225
  238
  251
  264
  279
  294
  309
Net income, $m
  102
  115
  129
  143
  158
  174
  191
  208
  226
  244
  274
  294
  315
  337
  359
  383
  407
  432
  459
  486
  515
  545
  576
  608
  642
  678
  715
  753
  794
  836

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
  1,689
  1,898
  2,119
  2,351
  2,596
  2,851
  3,118
  3,396
  3,686
  3,987
  4,300
  4,626
  4,964
  5,316
  5,682
  6,062
  6,457
  6,868
  7,296
  7,741
  8,206
  8,690
  9,194
  9,721
  10,270
  10,844
  11,444
  12,071
  12,726
  13,412
Adjusted assets (=assets-cash), $m
  1,689
  1,898
  2,119
  2,351
  2,596
  2,851
  3,118
  3,396
  3,686
  3,987
  4,300
  4,626
  4,964
  5,316
  5,682
  6,062
  6,457
  6,868
  7,296
  7,741
  8,206
  8,690
  9,194
  9,721
  10,270
  10,844
  11,444
  12,071
  12,726
  13,412
Revenue / Adjusted assets
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
  0.431
Average production assets, $m
  746
  838
  936
  1,039
  1,147
  1,259
  1,377
  1,500
  1,628
  1,761
  1,900
  2,044
  2,193
  2,349
  2,510
  2,678
  2,852
  3,034
  3,223
  3,420
  3,625
  3,839
  4,062
  4,294
  4,537
  4,791
  5,056
  5,333
  5,622
  5,925
Working capital, $m
  155
  174
  195
  216
  238
  262
  286
  312
  338
  366
  395
  425
  456
  488
  522
  556
  593
  630
  670
  711
  753
  798
  844
  892
  943
  996
  1,051
  1,108
  1,168
  1,231
Total debt, $m
  407
  480
  556
  636
  720
  808
  900
  996
  1,096
  1,200
  1,308
  1,421
  1,538
  1,659
  1,785
  1,916
  2,052
  2,194
  2,342
  2,496
  2,656
  2,823
  2,997
  3,179
  3,368
  3,566
  3,773
  3,989
  4,215
  4,452
Total liabilities, $m
  583
  655
  731
  811
  895
  984
  1,076
  1,172
  1,272
  1,375
  1,484
  1,596
  1,713
  1,834
  1,960
  2,091
  2,228
  2,369
  2,517
  2,671
  2,831
  2,998
  3,172
  3,354
  3,543
  3,741
  3,948
  4,164
  4,391
  4,627
Total equity, $m
  1,106
  1,243
  1,388
  1,540
  1,700
  1,867
  2,042
  2,224
  2,414
  2,611
  2,817
  3,030
  3,252
  3,482
  3,721
  3,970
  4,229
  4,499
  4,779
  5,071
  5,375
  5,692
  6,022
  6,367
  6,727
  7,103
  7,496
  7,906
  8,336
  8,785
Total liabilities and equity, $m
  1,689
  1,898
  2,119
  2,351
  2,595
  2,851
  3,118
  3,396
  3,686
  3,986
  4,301
  4,626
  4,965
  5,316
  5,681
  6,061
  6,457
  6,868
  7,296
  7,742
  8,206
  8,690
  9,194
  9,721
  10,270
  10,844
  11,444
  12,070
  12,727
  13,412
Debt-to-equity ratio
  0.370
  0.390
  0.400
  0.410
  0.420
  0.430
  0.440
  0.450
  0.450
  0.460
  0.460
  0.470
  0.470
  0.480
  0.480
  0.480
  0.490
  0.490
  0.490
  0.490
  0.490
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.500
  0.510
  0.510
Adjusted equity ratio
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655
  0.655

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  102
  115
  129
  143
  158
  174
  191
  208
  226
  244
  274
  294
  315
  337
  359
  383
  407
  432
  459
  486
  515
  545
  576
  608
  642
  678
  715
  753
  794
  836
Depreciation, amort., depletion, $m
  55
  60
  66
  71
  77
  83
  90
  96
  103
  111
  104
  112
  120
  128
  137
  146
  156
  166
  176
  187
  198
  210
  222
  235
  248
  262
  276
  291
  307
  324
Funds from operations, $m
  158
  176
  195
  215
  235
  257
  280
  304
  329
  355
  378
  406
  435
  465
  496
  529
  563
  598
  635
  673
  713
  755
  798
  843
  890
  940
  991
  1,045
  1,101
  1,160
Change in working capital, $m
  18
  19
  20
  21
  22
  23
  24
  26
  27
  28
  29
  30
  31
  32
  34
  35
  36
  38
  39
  41
  43
  44
  46
  48
  50
  53
  55
  58
  60
  63
Cash from operations, $m
  139
  156
  174
  193
  213
  234
  256
  279
  302
  327
  349
  376
  404
  433
  463
  494
  527
  560
  596
  632
  670
  710
  752
  795
  840
  887
  936
  987
  1,041
  1,097
Maintenance CAPEX, $m
  -36
  -41
  -46
  -51
  -57
  -63
  -69
  -75
  -82
  -89
  -96
  -104
  -112
  -120
  -128
  -137
  -146
  -156
  -166
  -176
  -187
  -198
  -210
  -222
  -235
  -248
  -262
  -276
  -291
  -307
New CAPEX, $m
  -87
  -92
  -98
  -103
  -108
  -113
  -118
  -123
  -128
  -133
  -138
  -144
  -150
  -155
  -161
  -168
  -175
  -182
  -189
  -197
  -205
  -214
  -223
  -233
  -243
  -254
  -265
  -277
  -290
  -303
Cash from investing activities, $m
  -123
  -133
  -144
  -154
  -165
  -176
  -187
  -198
  -210
  -222
  -234
  -248
  -262
  -275
  -289
  -305
  -321
  -338
  -355
  -373
  -392
  -412
  -433
  -455
  -478
  -502
  -527
  -553
  -581
  -610
Free cash flow, $m
  16
  23
  31
  39
  48
  58
  69
  81
  93
  105
  114
  128
  143
  158
  173
  189
  206
  223
  241
  259
  278
  298
  319
  340
  362
  385
  409
  434
  460
  487
Issuance/(repayment) of debt, $m
  68
  72
  76
  80
  84
  88
  92
  96
  100
  104
  108
  112
  117
  121
  126
  131
  136
  142
  148
  154
  160
  167
  174
  182
  190
  198
  207
  216
  226
  236
Issuance/(repurchase) of shares, $m
  27
  22
  16
  9
  2
  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  
  95
  94
  92
  89
  86
  88
  92
  96
  100
  104
  108
  112
  117
  121
  126
  131
  136
  142
  148
  154
  160
  167
  174
  182
  190
  198
  207
  216
  226
  236
Total cash flow (excl. dividends), $m
  112
  117
  123
  129
  134
  147
  161
  176
  192
  209
  223
  241
  259
  279
  299
  320
  342
  365
  388
  413
  439
  465
  493
  522
  552
  583
  616
  650
  686
  724
Retained Cash Flow (-), $m
  -129
  -137
  -145
  -152
  -160
  -167
  -175
  -182
  -190
  -197
  -205
  -213
  -222
  -230
  -239
  -249
  -259
  -269
  -280
  -292
  -304
  -317
  -331
  -345
  -360
  -376
  -393
  -411
  -429
  -449
Prev. year cash balance distribution, $m
  102
  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
  85
  -20
  -22
  -24
  -26
  -21
  -14
  -6
  3
  12
  17
  27
  38
  49
  60
  71
  83
  96
  108
  121
  134
  148
  162
  177
  192
  207
  223
  240
  257
  275
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
  81
  -18
  -19
  -20
  -20
  -15
  -9
  -4
  2
  6
  8
  12
  14
  16
  18
  18
  18
  18
  17
  15
  14
  12
  11
  9
  7
  6
  5
  4
  3
  2
Current shareholders' claim on cash, %
  99.6
  99.3
  99.1
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0
  99.0

Bio-Techne Corporation develops, manufactures and sells biotechnology reagents and instruments for the research and clinical diagnostic markets. The Company operates through three segments: Biotechnology, Clinical Controls and Protein Platforms. The Biotechnology segment develops, manufactures and sells biotechnology research and diagnostic products, such as cytokines, growth factors, immunoassays, antibodies and related reagents, across the world. The Clinical Controls segment develops and manufactures controls, calibrators, immunoassays and other reagents for the global clinical market. The Protein Platforms segment develops and commercializes systems and consumables for protein analysis. It markets immunoassays on different testing platforms, including microtiter-plate based kits sold under the trade name Quantikine, and immunoassays based on planar spotted surfaces and microfluidic-based multiplex immunoassays on automated testing platform.

FINANCIAL RATIOS  of  Bio-Techne Corp (TECH)

Valuation Ratios
P/E Ratio 96.7
Price to Sales 13.1
Price to Book 7.7
Price to Tangible Book
Price to Cash Flow 51.4
Price to Free Cash Flow 57.4
Growth Rates
Sales Growth Rate 12.8%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -11.8%
Cap. Spend. - 3 Yr. Gr. Rate 1.4%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 36.2%
Total Debt to Equity 36.2%
Interest Coverage 17
Management Effectiveness
Return On Assets 6%
Ret/ On Assets - 3 Yr. Avg. 9%
Return On Total Capital 6.7%
Ret/ On T. Cap. - 3 Yr. Avg. 10%
Return On Equity 8.3%
Return On Equity - 3 Yr. Avg. 11.2%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 66.6%
Gross Margin - 3 Yr. Avg. 67.4%
EBITDA Margin 31.8%
EBITDA Margin - 3 Yr. Avg. 37.7%
Operating Margin 21.5%
Oper. Margin - 3 Yr. Avg. 28.1%
Pre-Tax Margin 19.9%
Pre-Tax Margin - 3 Yr. Avg. 27.8%
Net Profit Margin 13.5%
Net Profit Margin - 3 Yr. Avg. 19.4%
Effective Tax Rate 32.1%
Eff/ Tax Rate - 3 Yr. Avg. 30.4%
Payout Ratio 61.8%

TECH stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TECH stock intrinsic value calculation we used $643 million for the last fiscal year's total revenue generated by Bio-Techne Corp. The default revenue input number comes from 0001 income statement of Bio-Techne Corp. 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 TECH stock valuation model: a) initial revenue growth rate of 13.2% 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 4.3%, whose default value for TECH is calculated based on our internal credit rating of Bio-Techne Corp, 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 Bio-Techne Corp.
    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 TECH stock the variable cost ratio is equal to 78.5%.

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 TECH 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 Bio-Techne Corp.

Corporate tax rate of 27% is the nominal tax rate for Bio-Techne Corp. 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 TECH 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 TECH are equal to 102.5%.

Life of production assets of 18.3 years is the average useful life of capital assets used in Bio-Techne Corp 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 TECH is equal to 21.3%. 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 - $1079.061 million for Bio-Techne Corp - 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 37.772 million for Bio-Techne Corp 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 Bio-Techne Corp at the current share price and the inputted number of shares is $7.4 billion.

RELATED COMPANIES Price Int.Val. Rating
LMNX Luminex Corpor 24.00 7.82  str.sell
BIO Bio-Rad Labora 313.67 63.05  str.sell
DHR Danaher Corpor 128.07 98.24  sell
BDX Becton, Dickin 244.67 396.45  str.buy
NSTG NanoString Tec 27.27 0.30  str.sell
RGEN Repligen Corpo 59.41 0.87  str.sell
ENZ Enzo Biochem, 2.55 0.41  str.sell

CONTACT US       ASSET ALLOCATION

About X-FIN       Privacy policy       Terms of use       FAQ

Copyright © X-FIN.com 2005-2019. All rigths reserved.