Intrinsic value of United Natural Foods, Inc. - UNFI

Previous Close

$10.27

  Intrinsic Value

$6.35

stock screener

  Rating & Target

sell

-38%

Previous close

$10.27

 
Intrinsic value

$6.35

 
Up/down potential

-38%

 
Rating

sell

We calculate the intrinsic value of UNFI 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 0.5

 

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
  16,363
  25,281
  37,808
  54,857
  77,396
  106,402
  142,822
  187,534
  241,311
  304,795
  378,487
  462,736
  557,753
  663,616
  780,294
  907,670
  1,045,560
  1,193,741
  1,351,974
  1,520,020
  1,697,660
  1,884,709
  2,081,025
  2,286,518
  2,501,157
  2,724,972
  2,958,055
  3,200,563
  3,452,717
  3,714,798
Variable operating expenses, $m
  15,937
  24,593
  36,751
  53,298
  75,173
  103,325
  138,673
  182,070
  234,263
  295,879
  367,345
  449,115
  541,335
  644,081
  757,325
  880,951
  1,014,782
  1,158,601
  1,312,176
  1,475,276
  1,647,687
  1,829,230
  2,019,767
  2,219,211
  2,427,532
  2,644,758
  2,870,980
  3,106,349
  3,351,080
  3,605,447
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
  15,937
  24,593
  36,751
  53,298
  75,173
  103,325
  138,673
  182,070
  234,263
  295,879
  367,345
  449,115
  541,335
  644,081
  757,325
  880,951
  1,014,782
  1,158,601
  1,312,176
  1,475,276
  1,647,687
  1,829,230
  2,019,767
  2,219,211
  2,427,532
  2,644,758
  2,870,980
  3,106,349
  3,351,080
  3,605,447
Operating income, $m
  426
  689
  1,057
  1,559
  2,223
  3,076
  4,149
  5,465
  7,048
  8,917
  11,141
  13,621
  16,418
  19,535
  22,969
  26,719
  30,778
  35,140
  39,797
  44,744
  49,973
  55,479
  61,258
  67,307
  73,626
  80,214
  87,075
  94,214
  101,636
  109,351
EBITDA, $m
  587
  907
  1,356
  1,968
  2,777
  3,817
  5,124
  6,728
  8,657
  10,935
  13,579
  16,601
  20,010
  23,808
  27,994
  32,564
  37,510
  42,827
  48,503
  54,532
  60,905
  67,616
  74,659
  82,031
  89,731
  97,761
  106,123
  114,823
  123,870
  133,272
Interest expense (income), $m
  17
  19
  55
  108
  182
  282
  415
  587
  801
  1,065
  1,383
  1,757
  2,192
  2,689
  3,250
  3,875
  4,563
  5,315
  6,128
  7,003
  7,936
  8,928
  9,976
  11,080
  12,239
  13,451
  14,718
  16,038
  17,414
  18,845
  20,333
Earnings before tax, $m
  407
  633
  950
  1,377
  1,940
  2,661
  3,562
  4,663
  5,983
  7,534
  9,384
  11,429
  13,729
  16,285
  19,095
  22,156
  25,463
  29,011
  32,795
  36,808
  41,045
  45,503
  50,178
  55,069
  60,174
  65,496
  71,037
  76,800
  82,791
  89,018
Tax expense, $m
  110
  171
  256
  372
  524
  719
  962
  1,259
  1,615
  2,034
  2,534
  3,086
  3,707
  4,397
  5,156
  5,982
  6,875
  7,833
  8,855
  9,938
  11,082
  12,286
  13,548
  14,869
  16,247
  17,684
  19,180
  20,736
  22,354
  24,035
Net income, $m
  297
  462
  693
  1,006
  1,416
  1,943
  2,600
  3,404
  4,367
  5,500
  6,850
  8,343
  10,022
  11,888
  13,939
  16,174
  18,588
  21,178
  23,940
  26,870
  29,963
  33,217
  36,630
  40,200
  43,927
  47,812
  51,857
  56,064
  60,438
  64,983

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
  4,743
  7,328
  10,959
  15,901
  22,434
  30,841
  41,398
  54,358
  69,945
  88,347
  109,706
  134,127
  161,668
  192,352
  226,172
  263,093
  303,061
  346,012
  391,876
  440,585
  492,075
  546,293
  603,196
  662,759
  724,973
  789,847
  857,407
  927,699
  1,000,787
  1,076,753
Adjusted assets (=assets-cash), $m
  4,743
  7,328
  10,959
  15,901
  22,434
  30,841
  41,398
  54,358
  69,945
  88,347
  109,706
  134,127
  161,668
  192,352
  226,172
  263,093
  303,061
  346,012
  391,876
  440,585
  492,075
  546,293
  603,196
  662,759
  724,973
  789,847
  857,407
  927,699
  1,000,787
  1,076,753
Revenue / Adjusted assets
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
  3.450
Average production assets, $m
  1,391
  2,149
  3,214
  4,663
  6,579
  9,044
  12,140
  15,940
  20,511
  25,908
  32,171
  39,333
  47,409
  56,407
  66,325
  77,152
  88,873
  101,468
  114,918
  129,202
  144,301
  160,200
  176,887
  194,354
  212,598
  231,623
  251,435
  272,048
  293,481
  315,758
Working capital, $m
  1,718
  2,655
  3,970
  5,760
  8,127
  11,172
  14,996
  19,691
  25,338
  32,004
  39,741
  48,587
  58,564
  69,680
  81,931
  95,305
  109,784
  125,343
  141,957
  159,602
  178,254
  197,894
  218,508
  240,084
  262,622
  286,122
  310,596
  336,059
  362,535
  390,054
Total debt, $m
  1,022
  1,997
  3,366
  5,229
  7,692
  10,861
  14,841
  19,727
  25,604
  32,541
  40,594
  49,800
  60,183
  71,751
  84,501
  98,420
  113,488
  129,681
  146,972
  165,335
  184,747
  205,187
  226,639
  249,094
  272,549
  297,007
  322,477
  348,977
  376,531
  405,170
Total liabilities, $m
  1,788
  2,763
  4,131
  5,995
  8,457
  11,627
  15,607
  20,493
  26,369
  33,307
  41,359
  50,566
  60,949
  72,517
  85,267
  99,186
  114,254
  130,446
  147,737
  166,101
  185,512
  205,952
  227,405
  249,860
  273,315
  297,772
  323,243
  349,743
  377,297
  405,936
Total equity, $m
  2,955
  4,565
  6,827
  9,906
  13,976
  19,214
  25,791
  33,865
  43,576
  55,040
  68,347
  83,561
  100,719
  119,836
  140,905
  163,907
  188,807
  215,565
  244,139
  274,485
  306,563
  340,340
  375,791
  412,899
  451,658
  492,075
  534,165
  577,957
  623,491
  670,817
Total liabilities and equity, $m
  4,743
  7,328
  10,958
  15,901
  22,433
  30,841
  41,398
  54,358
  69,945
  88,347
  109,706
  134,127
  161,668
  192,353
  226,172
  263,093
  303,061
  346,011
  391,876
  440,586
  492,075
  546,292
  603,196
  662,759
  724,973
  789,847
  857,408
  927,700
  1,000,788
  1,076,753
Debt-to-equity ratio
  0.350
  0.440
  0.490
  0.530
  0.550
  0.570
  0.580
  0.580
  0.590
  0.590
  0.590
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
  0.600
Adjusted equity ratio
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623
  0.623

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  297
  462
  693
  1,006
  1,416
  1,943
  2,600
  3,404
  4,367
  5,500
  6,850
  8,343
  10,022
  11,888
  13,939
  16,174
  18,588
  21,178
  23,940
  26,870
  29,963
  33,217
  36,630
  40,200
  43,927
  47,812
  51,857
  56,064
  60,438
  64,983
Depreciation, amort., depletion, $m
  161
  218
  299
  409
  554
  741
  975
  1,263
  1,609
  2,018
  2,437
  2,980
  3,592
  4,273
  5,025
  5,845
  6,733
  7,687
  8,706
  9,788
  10,932
  12,136
  13,401
  14,724
  16,106
  17,547
  19,048
  20,610
  22,233
  23,921
Funds from operations, $m
  458
  681
  992
  1,414
  1,970
  2,683
  3,576
  4,667
  5,977
  7,518
  9,288
  11,323
  13,614
  16,161
  18,964
  22,018
  25,321
  28,865
  32,646
  36,658
  40,895
  45,354
  50,031
  54,924
  60,033
  65,359
  70,905
  76,674
  82,671
  88,904
Change in working capital, $m
  644
  936
  1,315
  1,790
  2,367
  3,046
  3,824
  4,695
  5,647
  6,666
  7,738
  8,846
  9,977
  11,116
  12,251
  13,374
  14,478
  15,559
  16,614
  17,645
  18,652
  19,640
  20,613
  21,577
  22,537
  23,501
  24,474
  25,463
  26,476
  27,518
Cash from operations, $m
  -186
  -256
  -323
  -376
  -396
  -362
  -249
  -27
  330
  852
  1,550
  2,477
  3,637
  5,046
  6,712
  8,644
  10,842
  13,306
  16,032
  19,013
  22,243
  25,713
  29,417
  33,347
  37,496
  41,859
  46,431
  51,210
  56,195
  61,386
Maintenance CAPEX, $m
  -66
  -105
  -163
  -243
  -353
  -498
  -685
  -920
  -1,208
  -1,554
  -1,963
  -2,437
  -2,980
  -3,592
  -4,273
  -5,025
  -5,845
  -6,733
  -7,687
  -8,706
  -9,788
  -10,932
  -12,136
  -13,401
  -14,724
  -16,106
  -17,547
  -19,048
  -20,610
  -22,233
New CAPEX, $m
  -520
  -758
  -1,065
  -1,449
  -1,916
  -2,465
  -3,096
  -3,801
  -4,571
  -5,396
  -6,264
  -7,161
  -8,076
  -8,998
  -9,918
  -10,827
  -11,721
  -12,595
  -13,450
  -14,284
  -15,099
  -15,899
  -16,687
  -17,467
  -18,244
  -19,024
  -19,812
  -20,613
  -21,433
  -22,277
Cash from investing activities, $m
  -586
  -863
  -1,228
  -1,692
  -2,269
  -2,963
  -3,781
  -4,721
  -5,779
  -6,950
  -8,227
  -9,598
  -11,056
  -12,590
  -14,191
  -15,852
  -17,566
  -19,328
  -21,137
  -22,990
  -24,887
  -26,831
  -28,823
  -30,868
  -32,968
  -35,130
  -37,359
  -39,661
  -42,043
  -44,510
Free cash flow, $m
  -773
  -1,119
  -1,551
  -2,068
  -2,665
  -3,326
  -4,029
  -4,748
  -5,448
  -6,098
  -6,676
  -7,121
  -7,419
  -7,544
  -7,478
  -7,207
  -6,723
  -6,022
  -5,105
  -3,977
  -2,645
  -1,118
  594
  2,480
  4,528
  6,729
  9,072
  11,549
  14,152
  16,876
Issuance/(repayment) of debt, $m
  670
  975
  1,369
  1,863
  2,463
  3,170
  3,980
  4,886
  5,876
  6,937
  8,053
  9,206
  10,383
  11,568
  12,750
  13,919
  15,068
  16,193
  17,291
  18,363
  19,412
  20,440
  21,452
  22,455
  23,455
  24,457
  25,470
  26,500
  27,554
  28,639
Issuance/(repurchase) of shares, $m
  812
  1,148
  1,569
  2,073
  2,654
  3,295
  3,976
  4,670
  5,344
  5,964
  6,457
  6,870
  7,136
  7,229
  7,131
  6,828
  6,312
  5,580
  4,633
  3,476
  2,115
  560
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  1,482
  2,123
  2,938
  3,936
  5,117
  6,465
  7,956
  9,556
  11,220
  12,901
  14,510
  16,076
  17,519
  18,797
  19,881
  20,747
  21,380
  21,773
  21,924
  21,839
  21,527
  21,000
  21,452
  22,455
  23,455
  24,457
  25,470
  26,500
  27,554
  28,639
Total cash flow (excl. dividends), $m
  709
  1,004
  1,387
  1,868
  2,451
  3,139
  3,927
  4,808
  5,772
  6,804
  7,833
  8,955
  10,100
  11,253
  12,402
  13,539
  14,657
  15,751
  16,819
  17,862
  18,882
  19,882
  22,047
  24,935
  27,983
  31,186
  34,542
  38,049
  41,706
  45,515
Retained Cash Flow (-), $m
  -1,109
  -1,610
  -2,262
  -3,079
  -4,070
  -5,238
  -6,577
  -8,074
  -9,711
  -11,464
  -13,307
  -15,214
  -17,158
  -19,117
  -21,070
  -23,001
  -24,900
  -26,759
  -28,574
  -30,346
  -32,078
  -33,777
  -35,451
  -37,108
  -38,759
  -40,416
  -42,090
  -43,792
  -45,534
  -47,326
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
  -400
  -607
  -875
  -1,211
  -1,619
  -2,099
  -2,650
  -3,266
  -3,939
  -4,660
  -5,474
  -6,259
  -7,058
  -7,864
  -8,667
  -9,462
  -10,243
  -11,008
  -11,754
  -12,483
  -13,196
  -13,895
  -13,404
  -12,173
  -10,777
  -9,230
  -7,548
  -5,743
  -3,827
  -1,812
Discount rate, %
  4.70
  4.94
  5.18
  5.44
  5.71
  6.00
  6.30
  6.61
  6.94
  7.29
  7.66
  8.04
  8.44
  8.86
  9.31
  9.77
  10.26
  10.77
  11.31
  11.88
  12.47
  13.09
  13.75
  14.44
  15.16
  15.92
  16.71
  17.55
  18.42
  19.35
PV of cash for distribution, $m
  -382
  -551
  -752
  -980
  -1,226
  -1,480
  -1,728
  -1,957
  -2,153
  -2,306
  -2,432
  -2,475
  -2,462
  -2,395
  -2,282
  -2,129
  -1,947
  -1,746
  -1,535
  -1,323
  -1,118
  -927
  -693
  -478
  -316
  -198
  -116
  -62
  -28
  -9
Current shareholders' claim on cash, %
  61.4
  39.5
  26.5
  18.5
  13.4
  10.0
  7.7
  6.1
  5.0
  4.2
  3.6
  3.1
  2.8
  2.5
  2.3
  2.2
  2.1
  2.0
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9
  1.9

United Natural Foods, Inc. is a distributor and retailer of natural, organic and specialty products. The Company's segments include Wholesale and Other. The Wholesale segment is engaged in the national distribution of natural, organic and specialty foods, produce and related products in the United States and Canada. The Other segment includes a retail division, which engages in the sale of natural foods and related products to the general public through retail storefronts on the east coast of the United States; a manufacturing division, which engages in importing, roasting and packaging of nuts, seeds, dried fruit and snack items, and its branded product lines. Its operations consist of three operating divisions: Wholesale Division, Retail Division, and Manufacturing and Branded Products divisions. As of July 30, 2016, the Company had offered 100,000 natural, organic and specialty foods, and non-food products, consisting of national, regional and private-label brands.

FINANCIAL RATIOS  of  United Natural Foods, Inc. (UNFI)

Valuation Ratios
P/E Ratio 4
Price to Sales 0.1
Price to Book 0.3
Price to Tangible Book
Price to Cash Flow 1.9
Price to Free Cash Flow 2.3
Growth Rates
Sales Growth Rate 9.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 36.6%
Cap. Spend. - 3 Yr. Gr. Rate -17.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.1
LT Debt to Equity 22.2%
Total Debt to Equity 22.9%
Interest Coverage 14
Management Effectiveness
Return On Assets 4.9%
Ret/ On Assets - 3 Yr. Avg. 5.4%
Return On Total Capital 6.2%
Ret/ On T. Cap. - 3 Yr. Avg. 6.7%
Return On Equity 8.1%
Return On Equity - 3 Yr. Avg. 9.1%
Asset Turnover 3.2
Profitability Ratios
Gross Margin 15.4%
Gross Margin - 3 Yr. Avg. 15.3%
EBITDA Margin 3.4%
EBITDA Margin - 3 Yr. Avg. 3.6%
Operating Margin 2.4%
Oper. Margin - 3 Yr. Avg. 2.7%
Pre-Tax Margin 2.3%
Pre-Tax Margin - 3 Yr. Avg. 2.5%
Net Profit Margin 1.4%
Net Profit Margin - 3 Yr. Avg. 1.5%
Effective Tax Rate 39.3%
Eff/ Tax Rate - 3 Yr. Avg. 39.4%
Payout Ratio 0%

UNFI stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the UNFI stock intrinsic value calculation we used $10227 million for the last fiscal year's total revenue generated by United Natural Foods, Inc.. The default revenue input number comes from 0001 income statement of United Natural Foods, 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 UNFI 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 4.7%, whose default value for UNFI is calculated based on our internal credit rating of United Natural Foods, 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 United Natural Foods, 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 UNFI stock the variable cost ratio is equal to 97.6%.

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 UNFI 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 United Natural Foods, Inc..

Corporate tax rate of 27% is the nominal tax rate for United Natural Foods, 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 UNFI 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 UNFI are equal to 8.5%.

Life of production assets of 13.2 years is the average useful life of capital assets used in United Natural Foods, 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 UNFI is equal to 10.5%. 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 - $1845.955 million for United Natural Foods, 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 50.820 million for United Natural Foods, 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 United Natural Foods, Inc. at the current share price and the inputted number of shares is $0.5 billion.

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