Intrinsic value of TOP Ships Inc. - TOPS

Previous Close

$0.48

  Intrinsic Value

$1.14

stock screener

  Rating & Target

str. buy

+139%

Previous close

$0.48

 
Intrinsic value

$1.14

 
Up/down potential

+139%

 
Rating

str. buy

We calculate the intrinsic value of TOPS 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 0.0

 

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, %
  38.40
  35.06
  32.05
  29.35
  26.91
  24.72
  22.75
  20.98
  19.38
  17.94
  16.65
  15.48
  14.43
  13.49
  12.64
  11.88
  11.19
  10.57
  10.01
  9.51
  9.06
  8.65
  8.29
  7.96
  7.66
  7.40
  7.16
  6.94
  6.75
  6.57
Revenue, $m
  54
  73
  96
  125
  158
  197
  242
  293
  349
  412
  481
  555
  635
  721
  812
  908
  1,010
  1,117
  1,229
  1,346
  1,468
  1,595
  1,727
  1,864
  2,007
  2,156
  2,310
  2,470
  2,637
  2,810
Variable operating expenses, $m
  44
  60
  79
  102
  130
  162
  199
  240
  287
  338
  395
  456
  522
  592
  667
  746
  829
  917
  1,009
  1,105
  1,205
  1,309
  1,418
  1,531
  1,648
  1,770
  1,896
  2,028
  2,165
  2,307
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
  44
  60
  79
  102
  130
  162
  199
  240
  287
  338
  395
  456
  522
  592
  667
  746
  829
  917
  1,009
  1,105
  1,205
  1,309
  1,418
  1,531
  1,648
  1,770
  1,896
  2,028
  2,165
  2,307
Operating income, $m
  10
  13
  17
  22
  28
  35
  43
  52
  63
  74
  86
  99
  114
  129
  145
  163
  181
  200
  220
  241
  263
  285
  309
  334
  359
  386
  413
  442
  472
  503
EBITDA, $m
  18
  24
  32
  41
  52
  65
  80
  96
  115
  136
  158
  183
  209
  238
  268
  299
  333
  368
  405
  443
  484
  526
  569
  614
  661
  710
  761
  814
  869
  926
Interest expense (income), $m
  2
  17
  24
  31
  41
  52
  66
  82
  100
  121
  144
  170
  198
  228
  261
  296
  333
  373
  414
  458
  504
  552
  601
  653
  707
  763
  822
  883
  946
  1,011
  1,079
Earnings before tax, $m
  -8
  -11
  -14
  -19
  -24
  -31
  -39
  -48
  -59
  -71
  -84
  -99
  -115
  -132
  -151
  -171
  -192
  -214
  -238
  -263
  -289
  -316
  -344
  -374
  -404
  -436
  -469
  -503
  -539
  -576
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
  -8
  -11
  -14
  -19
  -24
  -31
  -39
  -48
  -59
  -71
  -84
  -99
  -115
  -132
  -151
  -171
  -192
  -214
  -238
  -263
  -289
  -316
  -344
  -374
  -404
  -436
  -469
  -503
  -539
  -576

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
  278
  376
  496
  642
  815
  1,016
  1,247
  1,509
  1,801
  2,124
  2,478
  2,861
  3,274
  3,716
  4,186
  4,683
  5,207
  5,757
  6,334
  6,936
  7,565
  8,219
  8,901
  9,609
  10,346
  11,111
  11,906
  12,733
  13,592
  14,486
Adjusted assets (=assets-cash), $m
  278
  376
  496
  642
  815
  1,016
  1,247
  1,509
  1,801
  2,124
  2,478
  2,861
  3,274
  3,716
  4,186
  4,683
  5,207
  5,757
  6,334
  6,936
  7,565
  8,219
  8,901
  9,609
  10,346
  11,111
  11,906
  12,733
  13,592
  14,486
Revenue / Adjusted assets
  0.194
  0.194
  0.194
  0.195
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
  0.194
Average production assets, $m
  201
  271
  358
  463
  588
  733
  900
  1,089
  1,299
  1,533
  1,788
  2,064
  2,362
  2,681
  3,020
  3,379
  3,757
  4,154
  4,570
  5,004
  5,458
  5,930
  6,422
  6,933
  7,464
  8,016
  8,590
  9,187
  9,807
  10,451
Working capital, $m
  -3
  -4
  -5
  -7
  -9
  -11
  -14
  -16
  -20
  -23
  -27
  -31
  -36
  -40
  -45
  -51
  -57
  -63
  -69
  -75
  -82
  -89
  -97
  -104
  -112
  -121
  -129
  -138
  -148
  -157
Total debt, $m
  140
  186
  243
  312
  394
  489
  598
  721
  859
  1,012
  1,179
  1,360
  1,555
  1,763
  1,985
  2,219
  2,467
  2,727
  2,999
  3,283
  3,580
  3,889
  4,210
  4,545
  4,892
  5,253
  5,629
  6,019
  6,425
  6,846
Total liabilities, $m
  131
  177
  234
  303
  384
  480
  589
  712
  850
  1,003
  1,170
  1,351
  1,545
  1,754
  1,976
  2,210
  2,458
  2,717
  2,990
  3,274
  3,571
  3,880
  4,201
  4,536
  4,883
  5,244
  5,620
  6,010
  6,416
  6,837
Total equity, $m
  147
  198
  262
  339
  430
  536
  658
  797
  951
  1,122
  1,308
  1,511
  1,729
  1,962
  2,210
  2,473
  2,749
  3,040
  3,344
  3,662
  3,994
  4,340
  4,700
  5,074
  5,463
  5,867
  6,287
  6,723
  7,177
  7,648
Total liabilities and equity, $m
  278
  375
  496
  642
  814
  1,016
  1,247
  1,509
  1,801
  2,125
  2,478
  2,862
  3,274
  3,716
  4,186
  4,683
  5,207
  5,757
  6,334
  6,936
  7,565
  8,220
  8,901
  9,610
  10,346
  11,111
  11,907
  12,733
  13,593
  14,485
Debt-to-equity ratio
  0.960
  0.940
  0.930
  0.920
  0.920
  0.910
  0.910
  0.910
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
  0.900
Adjusted equity ratio
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528
  0.528

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -8
  -11
  -14
  -19
  -24
  -31
  -39
  -48
  -59
  -71
  -84
  -99
  -115
  -132
  -151
  -171
  -192
  -214
  -238
  -263
  -289
  -316
  -344
  -374
  -404
  -436
  -469
  -503
  -539
  -576
Depreciation, amort., depletion, $m
  8
  11
  14
  19
  24
  30
  36
  44
  53
  62
  72
  84
  96
  109
  122
  137
  152
  168
  185
  203
  221
  240
  260
  281
  302
  325
  348
  372
  397
  423
Funds from operations, $m
  0
  0
  0
  0
  0
  -1
  -2
  -4
  -6
  -9
  -12
  -15
  -19
  -24
  -29
  -34
  -40
  -46
  -53
  -60
  -68
  -76
  -84
  -93
  -102
  -111
  -121
  -132
  -142
  -153
Change in working capital, $m
  -1
  -1
  -1
  -2
  -2
  -2
  -3
  -3
  -3
  -4
  -4
  -4
  -4
  -5
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -7
  -7
  -8
  -8
  -8
  -9
  -9
  -9
  -10
Cash from operations, $m
  1
  2
  2
  2
  2
  1
  0
  -1
  -3
  -5
  -8
  -11
  -15
  -19
  -23
  -29
  -34
  -40
  -47
  -54
  -61
  -69
  -77
  -85
  -94
  -103
  -113
  -123
  -133
  -143
Maintenance CAPEX, $m
  -6
  -8
  -11
  -14
  -19
  -24
  -30
  -36
  -44
  -53
  -62
  -72
  -84
  -96
  -109
  -122
  -137
  -152
  -168
  -185
  -203
  -221
  -240
  -260
  -281
  -302
  -325
  -348
  -372
  -397
New CAPEX, $m
  -56
  -70
  -87
  -105
  -125
  -145
  -167
  -189
  -211
  -233
  -255
  -277
  -298
  -319
  -339
  -359
  -378
  -397
  -416
  -435
  -453
  -472
  -492
  -511
  -531
  -552
  -574
  -596
  -620
  -645
Cash from investing activities, $m
  -62
  -78
  -98
  -119
  -144
  -169
  -197
  -225
  -255
  -286
  -317
  -349
  -382
  -415
  -448
  -481
  -515
  -549
  -584
  -620
  -656
  -693
  -732
  -771
  -812
  -854
  -899
  -944
  -992
  -1,042
Free cash flow, $m
  -60
  -77
  -96
  -118
  -142
  -168
  -196
  -226
  -258
  -291
  -325
  -360
  -396
  -433
  -471
  -510
  -549
  -590
  -631
  -673
  -717
  -762
  -808
  -856
  -906
  -958
  -1,011
  -1,067
  -1,125
  -1,185
Issuance/(repayment) of debt, $m
  36
  46
  57
  69
  82
  95
  109
  123
  138
  153
  167
  181
  195
  208
  222
  235
  247
  260
  272
  284
  297
  309
  322
  334
  348
  361
  375
  390
  406
  422
Issuance/(repurchase) of shares, $m
  49
  62
  78
  95
  115
  137
  161
  186
  213
  241
  271
  301
  333
  365
  399
  433
  469
  505
  542
  581
  621
  662
  704
  748
  793
  840
  889
  940
  993
  1,048
Cash from financing (excl. dividends), $m  
  85
  108
  135
  164
  197
  232
  270
  309
  351
  394
  438
  482
  528
  573
  621
  668
  716
  765
  814
  865
  918
  971
  1,026
  1,082
  1,141
  1,201
  1,264
  1,330
  1,399
  1,470
Total cash flow (excl. dividends), $m
  25
  31
  38
  46
  55
  64
  74
  83
  93
  103
  113
  122
  132
  141
  150
  158
  167
  175
  184
  192
  200
  209
  217
  226
  235
  244
  253
  263
  274
  285
Retained Cash Flow (-), $m
  -49
  -62
  -78
  -95
  -115
  -137
  -161
  -186
  -213
  -241
  -271
  -301
  -333
  -365
  -399
  -433
  -469
  -505
  -542
  -581
  -621
  -662
  -704
  -748
  -793
  -840
  -889
  -940
  -993
  -1,048
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
  -24
  -31
  -39
  -49
  -60
  -73
  -87
  -103
  -120
  -138
  -158
  -179
  -201
  -225
  -249
  -275
  -302
  -330
  -359
  -389
  -420
  -453
  -487
  -522
  -558
  -596
  -636
  -677
  -719
  -763
Discount rate, %
  8.20
  8.61
  9.04
  9.49
  9.97
  10.47
  10.99
  11.54
  12.12
  12.72
  13.36
  14.02
  14.73
  15.46
  16.24
  17.05
  17.90
  18.79
  19.73
  20.72
  21.76
  22.84
  23.99
  25.19
  26.45
  27.77
  29.16
  30.61
  32.15
  33.75
PV of cash for distribution, $m
  -22
  -26
  -30
  -34
  -38
  -40
  -42
  -43
  -43
  -42
  -40
  -37
  -34
  -30
  -26
  -22
  -18
  -15
  -12
  -9
  -7
  -5
  -3
  -2
  -2
  -1
  -1
  0
  0
  0
Current shareholders' claim on cash, %
  60.4
  37.7
  24.2
  15.9
  10.7
  7.3
  5.1
  3.7
  2.7
  1.9
  1.4
  1.1
  0.8
  0.6
  0.5
  0.4
  0.3
  0.2
  0.2
  0.2
  0.1
  0.1
  0.1
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0

Top Ships Inc. is an international provider of oil, petroleum products and chemicals transportation services. The Company owns and operates eco medium range (MR) tanker vessels focusing on the transportation of crude oil, petroleum products (clean and dirty) and bulk liquid chemicals. The Company's fleet includes over two chartered-in 50,000 deadweight ton (dwt) product/chemical tankers vessels, the Motor Tanker (M/T) Stenaweco Energy and the M/T Stenaweco Evolution; approximately two 39,000 dwt product/chemical tankers vessels, the M/T Eco Fleet and the M/T Eco Revolution, and over two 50,000 dwt product/chemical tankers scheduled for delivery from Hyundai Dockyard. Its newbuilding fleet consists of Hull No S414 (tbn M/T Stenaweco Excellence) and Hull No S417 (tbn M/T Nord Valiant). The Company's subsidiaries include Ocean Holdings Inc., Top Tanker Management Inc. and Lyndon International Co.

FINANCIAL RATIOS  of  TOP Ships Inc. (TOPS)

Valuation Ratios
P/E Ratio 0
Price to Sales 0
Price to Book 0
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow 0
Growth Rates
Sales Growth Rate 115.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 37.7%
Cap. Spend. - 3 Yr. Gr. Rate 39.1%
Financial Strength
Quick Ratio 0
Current Ratio 0.1
LT Debt to Equity 155.3%
Total Debt to Equity 180.9%
Interest Coverage 2
Management Effectiveness
Return On Assets 2.8%
Ret/ On Assets - 3 Yr. Avg. -1.2%
Return On Total Capital 1.1%
Ret/ On T. Cap. - 3 Yr. Avg. -2.1%
Return On Equity 2.5%
Return On Equity - 3 Yr. Avg. -3.5%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 100%
Gross Margin - 3 Yr. Avg. 91.7%
EBITDA Margin 25%
EBITDA Margin - 3 Yr. Avg. 21.2%
Operating Margin 14.3%
Oper. Margin - 3 Yr. Avg. -13.2%
Pre-Tax Margin 3.6%
Pre-Tax Margin - 3 Yr. Avg. 3.1%
Net Profit Margin 3.6%
Net Profit Margin - 3 Yr. Avg. 3.1%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

TOPS stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the TOPS stock intrinsic value calculation we used $39 million for the last fiscal year's total revenue generated by TOP Ships Inc.. The default revenue input number comes from 0001 income statement of TOP Ships 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 TOPS stock valuation model: a) initial revenue growth rate of 38.4% 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 8.2%, whose default value for TOPS is calculated based on our internal credit rating of TOP Ships 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 TOP Ships 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 TOPS stock the variable cost ratio is equal to 82.1%.

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 TOPS 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 16.8% for TOP Ships Inc..

Corporate tax rate of 27% is the nominal tax rate for TOP Ships 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 TOPS 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 TOPS are equal to 371.9%.

Life of production assets of 24.7 years is the average useful life of capital assets used in TOP Ships 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 TOPS is equal to -5.6%. 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 - $106.089 million for TOP Ships 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 23.316 million for TOP Ships 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 TOP Ships Inc. at the current share price and the inputted number of shares is $0.0 billion.

RELATED COMPANIES Price Int.Val. Rating
CPLP Capital Produc 10.49 1.83  sell
GASS StealthGas, In 3.28 3.60  hold
PXS Pyxis Tankers 1.02 0.58  str.sell
DRYS DryShips Inc. 3.59 1.84  str.sell
NVGS Navigator Hold 9.32 4.33  str.sell

CONTACT US      

About X-FIN       Privacy policy       Terms of use      

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