Intrinsic value of Teligent, Inc. - TLGT

Previous Close

$1.16

  Intrinsic Value

$2.37

stock screener

  Rating & Target

str. buy

+104%

Previous close

$1.16

 
Intrinsic value

$2.37

 
Up/down potential

+104%

 
Rating

str. buy

We calculate the intrinsic value of TLGT 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 0.1

 

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, %
  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
  107
  166
  248
  359
  507
  697
  936
  1,229
  1,581
  1,997
  2,480
  3,032
  3,654
  4,348
  5,112
  5,946
  6,850
  7,821
  8,857
  9,958
  11,122
  12,347
  13,633
  14,980
  16,386
  17,852
  19,379
  20,968
  22,620
  24,337
Variable operating expenses, $m
  99
  150
  221
  319
  447
  613
  821
  1,076
  1,383
  1,746
  2,161
  2,642
  3,184
  3,789
  4,455
  5,182
  5,969
  6,815
  7,718
  8,678
  9,692
  10,760
  11,880
  13,054
  14,279
  15,557
  16,887
  18,272
  19,711
  21,207
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
  99
  150
  221
  319
  447
  613
  821
  1,076
  1,383
  1,746
  2,161
  2,642
  3,184
  3,789
  4,455
  5,182
  5,969
  6,815
  7,718
  8,678
  9,692
  10,760
  11,880
  13,054
  14,279
  15,557
  16,887
  18,272
  19,711
  21,207
Operating income, $m
  8
  16
  26
  41
  60
  84
  115
  152
  198
  251
  319
  390
  470
  559
  657
  765
  881
  1,006
  1,139
  1,280
  1,430
  1,588
  1,753
  1,926
  2,107
  2,295
  2,492
  2,696
  2,908
  3,129
EBITDA, $m
  19
  30
  44
  64
  91
  125
  168
  220
  283
  358
  444
  543
  655
  779
  916
  1,066
  1,228
  1,402
  1,587
  1,785
  1,993
  2,213
  2,443
  2,685
  2,937
  3,199
  3,473
  3,758
  4,054
  4,362
Interest expense (income), $m
  5
  12
  20
  31
  48
  70
  100
  138
  186
  245
  315
  399
  496
  606
  731
  870
  1,024
  1,191
  1,372
  1,567
  1,775
  1,996
  2,229
  2,475
  2,733
  3,003
  3,285
  3,580
  3,886
  4,205
  4,536
Earnings before tax, $m
  -3
  -4
  -5
  -7
  -11
  -16
  -23
  -34
  -47
  -64
  -80
  -106
  -137
  -172
  -213
  -259
  -310
  -367
  -428
  -495
  -566
  -642
  -722
  -807
  -896
  -990
  -1,088
  -1,190
  -1,296
  -1,407
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
  -3
  -4
  -5
  -7
  -11
  -16
  -23
  -34
  -47
  -64
  -80
  -106
  -137
  -172
  -213
  -259
  -310
  -367
  -428
  -495
  -566
  -642
  -722
  -807
  -896
  -990
  -1,088
  -1,190
  -1,296
  -1,407

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
  283
  437
  654
  948
  1,338
  1,839
  2,469
  3,242
  4,171
  5,269
  6,542
  7,999
  9,641
  11,471
  13,488
  15,690
  18,073
  20,635
  23,370
  26,275
  29,345
  32,579
  35,972
  39,524
  43,234
  47,103
  51,132
  55,324
  59,683
  64,213
Adjusted assets (=assets-cash), $m
  283
  437
  654
  948
  1,338
  1,839
  2,469
  3,242
  4,171
  5,269
  6,542
  7,999
  9,641
  11,471
  13,488
  15,690
  18,073
  20,635
  23,370
  26,275
  29,345
  32,579
  35,972
  39,524
  43,234
  47,103
  51,132
  55,324
  59,683
  64,213
Revenue / Adjusted assets
  0.378
  0.380
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
  0.379
Average production assets, $m
  119
  185
  276
  400
  565
  777
  1,042
  1,369
  1,761
  2,224
  2,762
  3,377
  4,071
  4,843
  5,695
  6,624
  7,631
  8,712
  9,867
  11,093
  12,390
  13,755
  15,188
  16,687
  18,254
  19,887
  21,588
  23,358
  25,198
  27,111
Working capital, $m
  22
  34
  51
  74
  104
  143
  192
  252
  324
  409
  508
  621
  749
  891
  1,048
  1,219
  1,404
  1,603
  1,816
  2,041
  2,280
  2,531
  2,795
  3,071
  3,359
  3,660
  3,973
  4,298
  4,637
  4,989
Total debt, $m
  205
  327
  499
  732
  1,041
  1,438
  1,936
  2,549
  3,285
  4,154
  5,163
  6,316
  7,617
  9,066
  10,664
  12,407
  14,295
  16,324
  18,490
  20,791
  23,223
  25,783
  28,471
  31,284
  34,223
  37,287
  40,478
  43,798
  47,250
  50,838
Total liabilities, $m
  224
  346
  518
  751
  1,060
  1,457
  1,955
  2,567
  3,304
  4,173
  5,182
  6,335
  7,636
  9,085
  10,682
  12,426
  14,314
  16,343
  18,509
  20,810
  23,241
  25,802
  28,490
  31,303
  34,242
  37,306
  40,497
  43,817
  47,269
  50,857
Total equity, $m
  59
  91
  136
  197
  278
  383
  514
  674
  868
  1,096
  1,361
  1,664
  2,005
  2,386
  2,805
  3,263
  3,759
  4,292
  4,861
  5,465
  6,104
  6,776
  7,482
  8,221
  8,993
  9,797
  10,635
  11,507
  12,414
  13,356
Total liabilities and equity, $m
  283
  437
  654
  948
  1,338
  1,840
  2,469
  3,241
  4,172
  5,269
  6,543
  7,999
  9,641
  11,471
  13,487
  15,689
  18,073
  20,635
  23,370
  26,275
  29,345
  32,578
  35,972
  39,524
  43,235
  47,103
  51,132
  55,324
  59,683
  64,213
Debt-to-equity ratio
  3.490
  3.600
  3.670
  3.710
  3.740
  3.760
  3.770
  3.780
  3.790
  3.790
  3.790
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.800
  3.810
  3.810
  3.810
  3.810
  3.810
  3.810
  3.810
  3.810
Adjusted equity ratio
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208
  0.208

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -3
  -4
  -5
  -7
  -11
  -16
  -23
  -34
  -47
  -64
  -80
  -106
  -137
  -172
  -213
  -259
  -310
  -367
  -428
  -495
  -566
  -642
  -722
  -807
  -896
  -990
  -1,088
  -1,190
  -1,296
  -1,407
Depreciation, amort., depletion, $m
  11
  14
  18
  24
  31
  41
  53
  68
  86
  107
  126
  154
  185
  220
  259
  301
  347
  396
  448
  504
  563
  625
  690
  759
  830
  904
  981
  1,062
  1,145
  1,232
Funds from operations, $m
  8
  10
  13
  17
  21
  25
  30
  34
  39
  43
  46
  48
  49
  48
  46
  42
  36
  29
  20
  10
  -3
  -17
  -32
  -49
  -67
  -86
  -106
  -128
  -151
  -174
Change in working capital, $m
  8
  12
  17
  23
  30
  39
  49
  60
  72
  85
  99
  113
  128
  142
  157
  171
  185
  199
  213
  226
  239
  251
  264
  276
  288
  301
  313
  326
  339
  352
Cash from operations, $m
  -1
  -2
  -4
  -6
  -10
  -14
  -19
  -26
  -34
  -43
  -53
  -65
  -79
  -94
  -111
  -129
  -149
  -170
  -192
  -216
  -241
  -268
  -296
  -325
  -355
  -387
  -419
  -454
  -489
  -526
Maintenance CAPEX, $m
  -3
  -5
  -8
  -13
  -18
  -26
  -35
  -47
  -62
  -80
  -101
  -126
  -154
  -185
  -220
  -259
  -301
  -347
  -396
  -448
  -504
  -563
  -625
  -690
  -759
  -830
  -904
  -981
  -1,062
  -1,145
New CAPEX, $m
  -45
  -65
  -91
  -124
  -164
  -212
  -266
  -326
  -392
  -463
  -538
  -615
  -693
  -773
  -852
  -930
  -1,006
  -1,081
  -1,155
  -1,226
  -1,296
  -1,365
  -1,433
  -1,500
  -1,566
  -1,633
  -1,701
  -1,770
  -1,840
  -1,913
Cash from investing activities, $m
  -48
  -70
  -99
  -137
  -182
  -238
  -301
  -373
  -454
  -543
  -639
  -741
  -847
  -958
  -1,072
  -1,189
  -1,307
  -1,428
  -1,551
  -1,674
  -1,800
  -1,928
  -2,058
  -2,190
  -2,325
  -2,463
  -2,605
  -2,751
  -2,902
  -3,058
Free cash flow, $m
  -49
  -73
  -104
  -143
  -192
  -251
  -320
  -399
  -488
  -586
  -692
  -806
  -926
  -1,052
  -1,183
  -1,318
  -1,456
  -1,598
  -1,743
  -1,891
  -2,042
  -2,196
  -2,353
  -2,515
  -2,680
  -2,850
  -3,025
  -3,205
  -3,391
  -3,584
Issuance/(repayment) of debt, $m
  84
  122
  171
  233
  309
  397
  499
  612
  736
  869
  1,009
  1,153
  1,301
  1,449
  1,597
  1,744
  1,888
  2,029
  2,166
  2,301
  2,432
  2,561
  2,688
  2,813
  2,938
  3,064
  3,191
  3,320
  3,452
  3,588
Issuance/(repurchase) of shares, $m
  26
  36
  50
  69
  92
  120
  154
  194
  240
  292
  345
  409
  478
  553
  633
  717
  806
  900
  997
  1,099
  1,205
  1,314
  1,428
  1,546
  1,668
  1,795
  1,926
  2,062
  2,203
  2,349
Cash from financing (excl. dividends), $m  
  110
  158
  221
  302
  401
  517
  653
  806
  976
  1,161
  1,354
  1,562
  1,779
  2,002
  2,230
  2,461
  2,694
  2,929
  3,163
  3,400
  3,637
  3,875
  4,116
  4,359
  4,606
  4,859
  5,117
  5,382
  5,655
  5,937
Total cash flow (excl. dividends), $m
  61
  86
  118
  159
  208
  266
  333
  407
  488
  575
  661
  756
  853
  950
  1,047
  1,143
  1,238
  1,330
  1,420
  1,508
  1,595
  1,679
  1,762
  1,845
  1,927
  2,009
  2,092
  2,177
  2,263
  2,353
Retained Cash Flow (-), $m
  -26
  -36
  -50
  -69
  -92
  -120
  -154
  -194
  -240
  -292
  -345
  -409
  -478
  -553
  -633
  -717
  -806
  -900
  -997
  -1,099
  -1,205
  -1,314
  -1,428
  -1,546
  -1,668
  -1,795
  -1,926
  -2,062
  -2,203
  -2,349
Prev. year cash balance distribution, $m
  8
  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
  43
  50
  68
  90
  116
  146
  178
  213
  248
  283
  317
  348
  375
  397
  415
  426
  432
  431
  423
  410
  390
  365
  334
  299
  259
  214
  166
  115
  61
  4
Discount rate, %
  10.20
  10.71
  11.25
  11.81
  12.40
  13.02
  13.67
  14.35
  15.07
  15.82
  16.61
  17.45
  18.32
  19.23
  20.20
  21.21
  22.27
  23.38
  24.55
  25.77
  27.06
  28.42
  29.84
  31.33
  32.90
  34.54
  36.27
  38.08
  39.99
  41.98
PV of cash for distribution, $m
  39
  40
  49
  58
  65
  70
  73
  73
  70
  65
  58
  50
  42
  34
  26
  20
  14
  10
  7
  4
  3
  1
  1
  0
  0
  0
  0
  0
  0
  0
Current shareholders' claim on cash, %
  66.8
  46.4
  33.2
  24.4
  18.3
  14.0
  10.8
  8.5
  6.8
  5.5
  4.5
  3.7
  3.0
  2.5
  2.1
  1.8
  1.5
  1.3
  1.1
  1.0
  0.8
  0.7
  0.6
  0.5
  0.5
  0.4
  0.4
  0.3
  0.3
  0.2

Teligent, Inc. is a specialty generic pharmaceutical company. Under the Company's own label, it markets and sells generic injectable pharmaceutical products in the United States and Canada. In the United States it marketed 16 generic topical pharmaceutical products and four branded generic pharmaceutical products, as of December 31, 2016. It provides development, formulation and manufacturing services to the pharmaceutical, over-the-counter (OTC) and cosmetic industries. It focuses on developing, manufacturing and marketing a portfolio of generic pharmaceutical products under its own label in topical, injectable, complex and ophthalmic dosage forms, and managing its contract manufacturing and formulation services business. Its pipeline included 34 Abbreviated New Drug Application(ANDAs) filed with the United States Food and Drug Administration (FDA) for additional pharmaceutical products, as of December 31, 2016.

FINANCIAL RATIOS  of  Teligent, Inc. (TLGT)

Valuation Ratios
P/E Ratio -5.1
Price to Sales 0.9
Price to Book 1.1
Price to Tangible Book
Price to Cash Flow 61.7
Price to Free Cash Flow -3.4
Growth Rates
Sales Growth Rate 52.3%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 216.7%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 194.7%
Total Debt to Equity 194.7%
Interest Coverage -1
Management Effectiveness
Return On Assets -3.8%
Ret/ On Assets - 3 Yr. Avg. 2.6%
Return On Total Capital -7.1%
Ret/ On T. Cap. - 3 Yr. Avg. 1.3%
Return On Equity -19.4%
Return On Equity - 3 Yr. Avg. 5.2%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 52.2%
Gross Margin - 3 Yr. Avg. 50%
EBITDA Margin -4.5%
EBITDA Margin - 3 Yr. Avg. 14.8%
Operating Margin 4.5%
Oper. Margin - 3 Yr. Avg. 3.1%
Pre-Tax Margin -17.9%
Pre-Tax Margin - 3 Yr. Avg. 4.2%
Net Profit Margin -17.9%
Net Profit Margin - 3 Yr. Avg. 4.2%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

TLGT stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TLGT stock intrinsic value calculation we used $67 million for the last fiscal year's total revenue generated by Teligent, Inc.. The default revenue input number comes from 0001 income statement of Teligent, Inc.. 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 TLGT 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 10.2%, whose default value for TLGT is calculated based on our internal credit rating of Teligent, Inc., 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 Teligent, Inc..
    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 TLGT stock the variable cost ratio is equal to 95.5%.

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 TLGT 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 9.6% for Teligent, Inc..

Corporate tax rate of 27% is the nominal tax rate for Teligent, Inc.. 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 TLGT 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 TLGT are equal to 111.4%.

Life of production assets of 22 years is the average useful life of capital assets used in Teligent, Inc. 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 TLGT is equal to 20.5%. 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 - $44.753 million for Teligent, Inc. - 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 53.771 million for Teligent, Inc. 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 Teligent, Inc. at the current share price and the inputted number of shares is $0.1 billion.

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