Intrinsic value of 58.com ADR - WUBA

Previous Close

$65.22

  Intrinsic Value

$106.02

stock screener

  Rating & Target

str. buy

+63%

Previous close

$65.22

 
Intrinsic value

$106.02

 
Up/down potential

+63%

 
Rating

str. buy

We calculate the intrinsic value of WUBA 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 2016), $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 18.7

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  58.50
  53.15
  48.34
  44.00
  40.10
  36.59
  33.43
  30.59
  28.03
  25.73
  23.65
  21.79
  20.11
  18.60
  17.24
  16.02
  14.91
  13.92
  13.03
  12.23
  11.50
  10.85
  10.27
  9.74
  9.27
  8.84
  8.46
  8.11
  7.80
  7.52
Revenue, $m
  1,732
  2,653
  3,936
  5,667
  7,940
  10,845
  14,471
  18,898
  24,195
  30,419
  37,615
  45,811
  55,023
  65,257
  76,506
  88,759
  101,996
  116,197
  131,337
  147,396
  164,353
  182,191
  200,900
  220,471
  240,903
  262,200
  284,374
  307,440
  331,420
  356,342
Variable operating expenses, $m
  395
  472
  579
  723
  912
  1,154
  1,456
  1,825
  2,266
  2,784
  3,132
  3,814
  4,582
  5,434
  6,370
  7,391
  8,493
  9,675
  10,936
  12,273
  13,685
  15,170
  16,728
  18,358
  20,059
  21,832
  23,678
  25,599
  27,596
  29,671
Fixed operating expenses, $m
  749
  766
  782
  800
  817
  835
  854
  872
  892
  911
  931
  952
  973
  994
  1,016
  1,038
  1,061
  1,084
  1,108
  1,133
  1,158
  1,183
  1,209
  1,236
  1,263
  1,291
  1,319
  1,348
  1,378
  1,408
Total operating expenses, $m
  1,144
  1,238
  1,361
  1,523
  1,729
  1,989
  2,310
  2,697
  3,158
  3,695
  4,063
  4,766
  5,555
  6,428
  7,386
  8,429
  9,554
  10,759
  12,044
  13,406
  14,843
  16,353
  17,937
  19,594
  21,322
  23,123
  24,997
  26,947
  28,974
  31,079
Operating income, $m
  588
  1,416
  2,574
  4,145
  6,210
  8,856
  12,161
  16,201
  21,037
  26,724
  33,551
  41,044
  49,469
  58,829
  69,120
  80,330
  92,442
  105,437
  119,293
  133,990
  149,510
  165,838
  182,963
  200,877
  219,581
  239,078
  259,376
  280,492
  302,446
  325,263
EBITDA, $m
  1,281
  2,344
  3,830
  5,843
  8,489
  11,876
  16,107
  21,276
  27,465
  34,741
  43,155
  52,740
  63,516
  75,489
  88,652
  102,990
  118,482
  135,102
  152,823
  171,620
  191,469
  212,351
  234,252
  257,164
  281,084
  306,017
  331,977
  358,982
  387,057
  416,237
Interest expense (income), $m
  0
  15
  50
  100
  169
  262
  384
  540
  736
  974
  1,259
  1,594
  1,981
  2,422
  2,918
  3,469
  4,074
  4,734
  5,446
  6,210
  7,025
  7,890
  8,802
  9,762
  10,769
  11,822
  12,922
  14,068
  15,262
  16,503
  17,794
Earnings before tax, $m
  572
  1,366
  2,475
  3,976
  5,949
  8,472
  11,621
  15,465
  20,064
  25,465
  31,958
  39,063
  47,047
  55,911
  65,651
  76,256
  87,709
  99,991
  113,083
  126,965
  141,621
  157,036
  173,200
  190,108
  207,759
  226,155
  245,308
  265,231
  285,943
  307,469
Tax expense, $m
  155
  369
  668
  1,074
  1,606
  2,287
  3,138
  4,176
  5,417
  6,876
  8,629
  10,547
  12,703
  15,096
  17,726
  20,589
  23,681
  26,998
  30,532
  34,280
  38,238
  42,400
  46,764
  51,329
  56,095
  61,062
  66,233
  71,612
  77,205
  83,017
Net income, $m
  418
  997
  1,807
  2,903
  4,343
  6,184
  8,483
  11,290
  14,646
  18,590
  23,329
  28,516
  34,344
  40,815
  47,926
  55,667
  64,027
  72,993
  82,550
  92,684
  103,383
  114,636
  126,436
  138,779
  151,664
  165,093
  179,075
  193,618
  208,738
  224,453

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
  5,775
  8,844
  13,119
  18,891
  26,467
  36,151
  48,237
  62,992
  80,649
  101,398
  125,382
  152,702
  183,410
  217,523
  255,022
  295,864
  339,988
  387,322
  437,790
  491,319
  547,842
  607,305
  669,666
  734,902
  803,010
  874,002
  947,913
  1,024,798
  1,104,732
  1,187,807
Adjusted assets (=assets-cash), $m
  5,775
  8,844
  13,119
  18,891
  26,467
  36,151
  48,237
  62,992
  80,649
  101,398
  125,382
  152,702
  183,410
  217,523
  255,022
  295,864
  339,988
  387,322
  437,790
  491,319
  547,842
  607,305
  669,666
  734,902
  803,010
  874,002
  947,913
  1,024,798
  1,104,732
  1,187,807
Revenue / Adjusted assets
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
  0.300
Average production assets, $m
  4,423
  6,774
  10,048
  14,469
  20,271
  27,688
  36,945
  48,246
  61,769
  77,660
  96,030
  116,954
  140,474
  166,601
  195,321
  226,602
  260,397
  296,650
  335,304
  376,301
  419,592
  465,135
  512,897
  562,862
  615,025
  669,398
  726,007
  784,893
  846,114
  909,741
Working capital, $m
  -140
  -215
  -319
  -459
  -643
  -878
  -1,172
  -1,531
  -1,960
  -2,464
  -3,047
  -3,711
  -4,457
  -5,286
  -6,197
  -7,189
  -8,262
  -9,412
  -10,638
  -11,939
  -13,313
  -14,758
  -16,273
  -17,858
  -19,513
  -21,238
  -23,034
  -24,903
  -26,845
  -28,864
Total debt, $m
  925
  1,843
  3,121
  4,847
  7,112
  10,007
  13,621
  18,033
  23,312
  29,516
  36,688
  44,856
  54,038
  64,238
  75,450
  87,662
  100,855
  115,008
  130,098
  146,103
  163,003
  180,782
  199,428
  218,934
  239,298
  260,525
  282,624
  305,613
  329,513
  354,352
Total liabilities, $m
  1,727
  2,644
  3,922
  5,648
  7,914
  10,809
  14,423
  18,835
  24,114
  30,318
  37,489
  45,658
  54,840
  65,039
  76,251
  88,463
  101,656
  115,809
  130,899
  146,904
  163,805
  181,584
  200,230
  219,736
  240,100
  261,326
  283,426
  306,415
  330,315
  355,154
Total equity, $m
  4,048
  6,200
  9,196
  13,243
  18,553
  25,342
  33,814
  44,158
  56,535
  71,080
  87,893
  107,044
  128,571
  152,483
  178,770
  207,400
  238,331
  271,513
  306,891
  344,415
  384,037
  425,720
  469,436
  515,167
  562,910
  612,675
  664,487
  718,384
  774,417
  832,653
Total liabilities and equity, $m
  5,775
  8,844
  13,118
  18,891
  26,467
  36,151
  48,237
  62,993
  80,649
  101,398
  125,382
  152,702
  183,411
  217,522
  255,021
  295,863
  339,987
  387,322
  437,790
  491,319
  547,842
  607,304
  669,666
  734,903
  803,010
  874,001
  947,913
  1,024,799
  1,104,732
  1,187,807
Debt-to-equity ratio
  0.230
  0.300
  0.340
  0.370
  0.380
  0.390
  0.400
  0.410
  0.410
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.420
  0.430
  0.430
  0.430
  0.430
  0.430
  0.430
Adjusted equity ratio
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701
  0.701

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  418
  997
  1,807
  2,903
  4,343
  6,184
  8,483
  11,290
  14,646
  18,590
  23,329
  28,516
  34,344
  40,815
  47,926
  55,667
  64,027
  72,993
  82,550
  92,684
  103,383
  114,636
  126,436
  138,779
  151,664
  165,093
  179,075
  193,618
  208,738
  224,453
Depreciation, amort., depletion, $m
  693
  928
  1,256
  1,698
  2,278
  3,020
  3,946
  5,076
  6,428
  8,017
  9,603
  11,695
  14,047
  16,660
  19,532
  22,660
  26,040
  29,665
  33,530
  37,630
  41,959
  46,513
  51,290
  56,286
  61,502
  66,940
  72,601
  78,489
  84,611
  90,974
Funds from operations, $m
  1,111
  1,925
  3,062
  4,601
  6,621
  9,204
  12,429
  16,365
  21,074
  26,607
  32,932
  40,212
  48,391
  57,475
  67,458
  78,327
  90,067
  102,658
  116,081
  130,314
  145,342
  161,150
  177,726
  195,065
  213,166
  232,033
  251,676
  272,108
  293,350
  315,427
Change in working capital, $m
  -52
  -75
  -104
  -140
  -184
  -235
  -294
  -359
  -429
  -504
  -583
  -664
  -746
  -829
  -911
  -992
  -1,072
  -1,150
  -1,226
  -1,301
  -1,374
  -1,445
  -1,515
  -1,585
  -1,655
  -1,725
  -1,796
  -1,868
  -1,942
  -2,019
Cash from operations, $m
  1,163
  2,000
  3,166
  4,741
  6,805
  9,440
  12,723
  16,724
  21,504
  27,111
  33,515
  40,875
  49,138
  58,304
  68,369
  79,320
  91,139
  103,809
  117,307
  131,615
  146,716
  162,595
  179,241
  196,650
  214,821
  233,758
  253,472
  273,976
  295,292
  317,445
Maintenance CAPEX, $m
  -279
  -442
  -677
  -1,005
  -1,447
  -2,027
  -2,769
  -3,694
  -4,825
  -6,177
  -7,766
  -9,603
  -11,695
  -14,047
  -16,660
  -19,532
  -22,660
  -26,040
  -29,665
  -33,530
  -37,630
  -41,959
  -46,513
  -51,290
  -56,286
  -61,502
  -66,940
  -72,601
  -78,489
  -84,611
New CAPEX, $m
  -1,632
  -2,351
  -3,274
  -4,421
  -5,802
  -7,417
  -9,257
  -11,301
  -13,523
  -15,891
  -18,370
  -20,924
  -23,520
  -26,127
  -28,720
  -31,281
  -33,795
  -36,253
  -38,654
  -40,998
  -43,291
  -45,542
  -47,762
  -49,965
  -52,163
  -54,373
  -56,609
  -58,886
  -61,221
  -63,627
Cash from investing activities, $m
  -1,911
  -2,793
  -3,951
  -5,426
  -7,249
  -9,444
  -12,026
  -14,995
  -18,348
  -22,068
  -26,136
  -30,527
  -35,215
  -40,174
  -45,380
  -50,813
  -56,455
  -62,293
  -68,319
  -74,528
  -80,921
  -87,501
  -94,275
  -101,255
  -108,449
  -115,875
  -123,549
  -131,487
  -139,710
  -148,238
Free cash flow, $m
  -748
  -793
  -785
  -685
  -444
  -5
  697
  1,728
  3,156
  5,043
  7,379
  10,349
  13,923
  18,130
  22,988
  28,506
  34,684
  41,516
  48,988
  57,087
  65,795
  75,093
  84,965
  95,396
  106,372
  117,883
  129,923
  142,489
  155,582
  169,207
Issuance/(repayment) of debt, $m
  638
  918
  1,278
  1,726
  2,265
  2,896
  3,614
  4,412
  5,279
  6,204
  7,171
  8,169
  9,182
  10,200
  11,212
  12,212
  13,193
  14,153
  15,090
  16,005
  16,900
  17,779
  18,646
  19,506
  20,364
  21,227
  22,100
  22,989
  23,900
  24,839
Issuance/(repurchase) of shares, $m
  1,072
  1,155
  1,190
  1,144
  968
  604
  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  
  1,710
  2,073
  2,468
  2,870
  3,233
  3,500
  3,614
  4,412
  5,279
  6,204
  7,171
  8,169
  9,182
  10,200
  11,212
  12,212
  13,193
  14,153
  15,090
  16,005
  16,900
  17,779
  18,646
  19,506
  20,364
  21,227
  22,100
  22,989
  23,900
  24,839
Total cash flow (excl. dividends), $m
  962
  1,279
  1,683
  2,185
  2,789
  3,495
  4,311
  6,140
  8,435
  11,247
  14,550
  18,517
  23,105
  28,330
  34,201
  40,718
  47,878
  55,669
  64,078
  73,092
  82,695
  92,872
  103,611
  114,902
  126,736
  139,110
  152,022
  165,478
  179,482
  194,046
Retained Cash Flow (-), $m
  -1,490
  -2,152
  -2,997
  -4,046
  -5,310
  -6,789
  -8,472
  -10,343
  -12,377
  -14,545
  -16,813
  -19,151
  -21,527
  -23,913
  -26,287
  -28,630
  -30,931
  -33,181
  -35,378
  -37,524
  -39,623
  -41,683
  -43,715
  -45,731
  -47,743
  -49,765
  -51,812
  -53,897
  -56,033
  -58,236
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
  38
  61
  93
  138
  198
  278
  380
  506
  661
  847
  1,065
  1,317
  1,603
  1,926
  2,284
  2,678
  3,107
  3,570
  4,067
  4,597
  5,159
  5,752
  6,377
  7,031
  7,716
  8,432
  9,177
  9,953
  10,760
  11,600
Cash available for distribution, $m
  -528
  -872
  -1,313
  -1,862
  -2,522
  -3,294
  -4,161
  -4,203
  -3,942
  -3,298
  -2,263
  -634
  1,578
  4,417
  7,914
  12,088
  16,947
  22,487
  28,700
  35,568
  43,072
  51,189
  59,896
  69,171
  78,993
  89,344
  100,211
  111,581
  123,449
  135,811
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
  -506
  -799
  -1,143
  -1,533
  -1,955
  -2,390
  -2,811
  -2,627
  -2,265
  -1,729
  -1,075
  -271
  600
  1,483
  2,323
  3,072
  3,687
  4,141
  4,419
  4,520
  4,455
  4,247
  3,926
  3,523
  3,073
  2,607
  2,151
  1,726
  1,348
  1,023
Current shareholders' claim on cash, %
  94.6
  91.0
  88.7
  87.2
  86.4
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0
  86.0

58.com Inc. is a holding company. The Company's business consists of its online classifieds and listing platforms. Its online classifieds and listings platforms enable local merchants and consumers to connect, share information and conduct business in China. These platforms include 58, Ganji and Anjuke. 58 and Ganji are online multi-content category-classified advertising platforms, while Anjuke is an online real estate listing platform. In addition, 58 Daojia Inc., its subsidiary, operates a mobile-based closed-loop transactional platform for home services, which directly connects consumers and individual service providers for local services, such as home cleaning, moving services and manicure services provided at home. Its classifieds and listing platforms contain local information for over 480 cities across various content categories, including jobs, real estate, used goods, automotive and yellow pages. It also offers membership, online marketing services and e-commerce services.

FINANCIAL RATIOS  of  58.com ADR (WUBA)

Valuation Ratios
P/E Ratio -167.2
Price to Sales 17.2
Price to Book 7.4
Price to Tangible Book
Price to Cash Flow 69.2
Price to Free Cash Flow 78.1
Growth Rates
Sales Growth Rate 69.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -83%
Cap. Spend. - 3 Yr. Gr. Rate 50.6%
Financial Strength
Quick Ratio 1
Current Ratio 0.2
LT Debt to Equity 0.8%
Total Debt to Equity 11.3%
Interest Coverage 0
Management Effectiveness
Return On Assets -3%
Ret/ On Assets - 3 Yr. Avg. -2.9%
Return On Total Capital -3.9%
Ret/ On T. Cap. - 3 Yr. Avg. -3.7%
Return On Equity -4.3%
Return On Equity - 3 Yr. Avg. -4.2%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 90.7%
Gross Margin - 3 Yr. Avg. 92.8%
EBITDA Margin -5.5%
EBITDA Margin - 3 Yr. Avg. -8.6%
Operating Margin 4.1%
Oper. Margin - 3 Yr. Avg. -3.9%
Pre-Tax Margin -10.8%
Pre-Tax Margin - 3 Yr. Avg. -12.6%
Net Profit Margin -10.3%
Net Profit Margin - 3 Yr. Avg. -12.3%
Effective Tax Rate 5.9%
Eff/ Tax Rate - 3 Yr. Avg. 10.1%
Payout Ratio 0%

WUBA stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the WUBA stock intrinsic value calculation we used $1093 million for the last fiscal year's total revenue generated by 58.com ADR. The default revenue input number comes from 2016 income statement of 58.com ADR. 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 WUBA stock valuation model: a) initial revenue growth rate of 58.5% 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 WUBA is calculated based on our internal credit rating of 58.com ADR, 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 58.com ADR.
    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 WUBA stock the variable cost ratio is equal to 31.3%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $733 million in the base year in the intrinsic value calculation for WUBA 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 58.com ADR.

Corporate tax rate of 27% is the nominal tax rate for 58.com ADR. 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 WUBA stock is equal to 3.5%.

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 WUBA are equal to 255.3%.

Life of production assets of 10 years is the average useful life of capital assets used in 58.com ADR 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 WUBA is equal to -8.1%. 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 - $2558 million for 58.com ADR - 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 287 million for 58.com ADR 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 58.com ADR at the current share price and the inputted number of shares is $18.7 billion.

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COMPANY NEWS

▶ Why Shares of 58.com Are Surging Today   [12:45PM  Motley Fool]
▶ Q2 Earnings Outlook For 58.com   [02:46PM  Benzinga]
▶ New Strong Sell Stocks for July 13th   [Jul-13-18 07:10AM  Zacks]
▶ Should You Buy 58com Inc (NYSE:WUBA) Now?   [Jun-25-18 08:26AM  Simply Wall St.]
▶ Bear of the Day: 58.com (WUBA)   [07:00AM  Zacks]
▶ Bilibili Soars On Quarterly Earnings Report As Sales Double   [May-24-18 04:12PM  Investor's Business Daily]
▶ Best Chinese Stocks To Buy And Watch   [10:15AM  Investor's Business Daily]
▶ Earnings Calendar, Analyst Estimates And Stocks To Watch   [10:05AM  Investor's Business Daily]
▶ Apple Leads Five Hot Stocks Now In Buy Range   [May-07-18 04:03PM  Investor's Business Daily]
▶ The Cup Without Handle Can Also Yield Bullish Stock Breakouts   [Apr-11-18 08:15PM  Investor's Business Daily]
▶ 58.com Dips As Quarterly Results Top Estimates, Outlook Falls Short   [Mar-08-18 04:54PM  Investor's Business Daily]
▶ Hey Market, Can You Give Me a Minute to Catch My Breath?   [Jan-24-18 11:11AM  TheStreet.com]
▶ Cheetah Mobile Off To Fast Start After Adding 58.com Founder To Board   [Jan-11-18 04:07PM  Investor's Business Daily]
▶ As Alibaba Sets Up, The Craigslist Of China Posts 2,550% Growth   [Jan-08-18 03:49PM  Investor's Business Daily]
▶ Should You Buy 58com Inc (NYSE:WUBA) At $71.86?   [Dec-28-17 07:15AM  Simply Wall St.]
▶ 58.com Joins Rank Of Stocks With 95-Plus Composite Rating   [Dec-27-17 03:00AM  Investor's Business Daily]
▶ 58.com Showed How A Damaged Stock Can Fix Itself And Be A Winner   [Nov-30-17 07:28PM  Investor's Business Daily]
▶ 58.com Shares Jump As Third-Quarter Results Top Estimates   [Nov-13-17 04:05PM  Investor's Business Daily]
▶ ETFs with exposure to 58.com Inc. : November 9, 2017   [Nov-09-17 01:23PM  Capital Cube]
▶ 58.com Sees Composite Rating Improve To 96   [Nov-01-17 03:00AM  Investor's Business Daily]
▶ Criteo (CRTO) Catches Eye: Stock Jumps 6.5%   [Sep-22-17 08:36AM  Zacks]
▶ [$$] Asian logistics companies GoGoVan and 58 Suyun to merge   [Aug-29-17 06:05PM  Financial Times]
▶ ETFs with exposure to 58.com Inc. : August 28, 2017   [Aug-28-17 07:23PM  Capital Cube]
▶ ETF Topper: U.S.-Listed China Tech Stocks Take the Cake   [Aug-21-17 05:35PM  Barrons.com]
▶ Chinese Stock Is Gaining Ground   [12:52PM  GuruFocus.com]
▶ Why Shares of 58.com Are Soaring Today   [12:34PM  Motley Fool]
▶ As Alibaba Climbs, This Other Chinese Stock Tests New Buy Zone   [Jul-11-17 04:09PM  Investor's Business Daily]
▶ Can These Momentum Stocks Break Out One More Time?   [Jul-05-17 01:00PM  Investopedia]
▶ After Alibaba, Weibo Moves, This Chinese Stock May Be Setting Up   [Jun-30-17 03:06PM  Investor's Business Daily]
▶ ETFs with exposure to 58.com Inc. : June 27, 2017   [Jun-27-17 04:00PM  Capital Cube]
▶ Guazi Announces Series B Financing   [Jun-16-17 02:00AM  PR Newswire]
▶ IPO Stock News And Analysis: Find Today's Top New Issues   [May-26-17 04:31PM  Investor's Business Daily]
▶ Which Stocks Are Showing Rising Relative Strength?   [04:09PM  Investor's Business Daily]
▶ As Alibaba, JD And Weibo Lead, 2013 IPO 58.com Rebounds   [04:07PM  Investor's Business Daily]
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