Intrinsic value of ZIOPHARM Oncology - ZIOP

Previous Close

$3.08

  Intrinsic Value

$0.00

stock screener

  Rating & Target

str. sell

-100%

Previous close

$3.08

 
Intrinsic value

$0.00

 
Up/down potential

-100%

 
Rating

str. sell

We calculate the intrinsic value of ZIOP 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 0.4

 

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, %
  2.00
  2.30
  2.57
  2.81
  3.03
  3.23
  3.41
  3.57
  3.71
  3.84
  3.95
  4.06
  4.15
  4.24
  4.31
  4.38
  4.44
  4.50
  4.55
  4.59
  4.64
  4.67
  4.70
  4.73
  4.76
  4.78
  4.81
  4.83
  4.84
  4.86
Revenue, $m
  7
  7
  7
  7
  7
  7
  8
  8
  8
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  13
  14
  14
  15
  16
  17
  17
  18
  19
  20
  21
Variable operating expenses, $m
  164
  168
  172
  177
  182
  188
  195
  202
  209
  217
  226
  235
  245
  255
  266
  278
  290
  303
  317
  331
  347
  363
  380
  398
  417
  437
  458
  480
  503
  527
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
  164
  168
  172
  177
  182
  188
  195
  202
  209
  217
  226
  235
  245
  255
  266
  278
  290
  303
  317
  331
  347
  363
  380
  398
  417
  437
  458
  480
  503
  527
Operating income, $m
  -157
  -161
  -165
  -170
  -175
  -181
  -187
  -194
  -201
  -208
  -217
  -225
  -235
  -245
  -255
  -266
  -278
  -291
  -304
  -318
  -333
  -348
  -365
  -382
  -400
  -419
  -439
  -461
  -483
  -506
EBITDA, $m
  -157
  -161
  -165
  -170
  -175
  -180
  -187
  -193
  -200
  -208
  -216
  -225
  -234
  -244
  -255
  -266
  -278
  -290
  -304
  -318
  -332
  -348
  -364
  -381
  -400
  -419
  -439
  -460
  -482
  -506
Interest expense (income), $m
  0
  0
  -8
  -8
  -8
  -8
  -8
  -8
  -7
  -7
  -7
  -7
  -7
  -7
  -7
  -6
  -6
  -6
  -6
  -6
  -5
  -5
  -5
  -4
  -4
  -4
  -3
  -3
  -3
  -2
  -2
Earnings before tax, $m
  -157
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -210
  -219
  -228
  -238
  -249
  -260
  -272
  -285
  -299
  -313
  -328
  -344
  -360
  -378
  -396
  -416
  -436
  -458
  -481
  -505
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
  -157
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -210
  -219
  -228
  -238
  -249
  -260
  -272
  -285
  -299
  -313
  -328
  -344
  -360
  -378
  -396
  -416
  -436
  -458
  -481
  -505

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
  60
  62
  63
  65
  67
  69
  72
  74
  77
  80
  83
  86
  90
  94
  98
  102
  107
  111
  117
  122
  128
  133
  140
  146
  153
  161
  168
  177
  185
  194
Adjusted assets (=assets-cash), $m
  60
  62
  63
  65
  67
  69
  72
  74
  77
  80
  83
  86
  90
  94
  98
  102
  107
  111
  117
  122
  128
  133
  140
  146
  153
  161
  168
  177
  185
  194
Revenue / Adjusted assets
  0.117
  0.113
  0.111
  0.108
  0.104
  0.101
  0.111
  0.108
  0.104
  0.113
  0.108
  0.105
  0.111
  0.106
  0.112
  0.108
  0.112
  0.108
  0.111
  0.107
  0.109
  0.105
  0.107
  0.110
  0.111
  0.106
  0.107
  0.107
  0.108
  0.108
Average production assets, $m
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  3
  3
  4
Working capital, $m
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -2
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -3
  -4
  -4
  -4
Total debt, $m
  -148
  -147
  -145
  -144
  -142
  -140
  -138
  -136
  -133
  -131
  -128
  -125
  -121
  -118
  -114
  -111
  -106
  -102
  -98
  -93
  -88
  -82
  -77
  -71
  -64
  -58
  -51
  -44
  -36
  -28
Total liabilities, $m
  54
  56
  57
  59
  60
  62
  64
  67
  69
  72
  75
  78
  81
  84
  88
  92
  96
  100
  105
  110
  115
  120
  126
  132
  138
  145
  152
  159
  167
  175
Total equity, $m
  6
  6
  6
  7
  7
  7
  7
  7
  8
  8
  8
  9
  9
  9
  10
  10
  11
  11
  12
  12
  13
  13
  14
  15
  15
  16
  17
  18
  19
  19
Total liabilities and equity, $m
  60
  62
  63
  66
  67
  69
  71
  74
  77
  80
  83
  87
  90
  93
  98
  102
  107
  111
  117
  122
  128
  133
  140
  147
  153
  161
  169
  177
  186
  194
Debt-to-equity ratio
  -24.540
  -23.790
  -22.970
  -22.090
  -21.180
  -20.240
  -19.270
  -18.300
  -17.320
  -16.350
  -15.390
  -14.440
  -13.500
  -12.590
  -11.690
  -10.820
  -9.980
  -9.160
  -8.370
  -7.610
  -6.870
  -6.170
  -5.480
  -4.830
  -4.200
  -3.600
  -3.020
  -2.470
  -1.940
  -1.430
Adjusted equity ratio
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -157
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -210
  -219
  -228
  -238
  -249
  -260
  -272
  -285
  -299
  -313
  -328
  -344
  -360
  -378
  -396
  -416
  -436
  -458
  -481
  -505
Depreciation, amort., depletion, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
Funds from operations, $m
  -157
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -209
  -218
  -228
  -238
  -249
  -260
  -272
  -285
  -298
  -312
  -327
  -343
  -360
  -377
  -396
  -415
  -436
  -457
  -480
  -504
Change in working capital, $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 from operations, $m
  -157
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -209
  -218
  -228
  -238
  -248
  -260
  -272
  -285
  -298
  -312
  -327
  -343
  -360
  -377
  -396
  -415
  -436
  -457
  -480
  -504
Maintenance CAPEX, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
New CAPEX, $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 from investing activities, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
Free cash flow, $m
  -158
  -153
  -157
  -162
  -167
  -173
  -179
  -186
  -193
  -201
  -210
  -219
  -228
  -238
  -249
  -260
  -272
  -285
  -299
  -313
  -328
  -344
  -360
  -378
  -396
  -416
  -436
  -458
  -481
  -504
Issuance/(repayment) of debt, $m
  -148
  1
  1
  2
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  4
  4
  4
  4
  5
  5
  5
  5
  6
  6
  6
  7
  7
  7
  8
  8
Issuance/(repurchase) of shares, $m
  311
  153
  157
  162
  167
  173
  180
  186
  194
  202
  210
  219
  228
  239
  249
  261
  273
  286
  299
  313
  328
  344
  361
  379
  397
  417
  437
  459
  482
  505
Cash from financing (excl. dividends), $m  
  163
  154
  158
  164
  169
  175
  182
  188
  196
  205
  213
  222
  231
  242
  253
  265
  277
  290
  304
  318
  333
  349
  367
  385
  403
  424
  444
  466
  490
  513
Total cash flow (excl. dividends), $m
  5
  1
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  4
  4
  4
  4
  5
  5
  5
  5
  6
  6
  6
  7
  7
  7
  8
  8
  9
  9
Retained Cash Flow (-), $m
  -311
  -153
  -157
  -162
  -167
  -173
  -180
  -186
  -194
  -202
  -210
  -219
  -228
  -239
  -249
  -261
  -273
  -286
  -299
  -313
  -328
  -344
  -361
  -379
  -397
  -417
  -437
  -459
  -482
  -505
Prev. year cash balance distribution, $m
  50
  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
  -255
  -152
  -156
  -160
  -165
  -171
  -177
  -184
  -191
  -199
  -207
  -215
  -225
  -235
  -245
  -256
  -268
  -281
  -294
  -308
  -323
  -338
  -355
  -372
  -390
  -409
  -429
  -451
  -473
  -496
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
  -245
  -139
  -136
  -132
  -128
  -124
  -120
  -115
  -110
  -104
  -98
  -92
  -85
  -79
  -72
  -65
  -58
  -52
  -45
  -39
  -33
  -28
  -23
  -19
  -15
  -12
  -9
  -7
  -5
  -4
Current shareholders' claim on cash, %
  50.0
  1.9
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
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ZIOPHARM Oncology, Inc. is a biopharmaceutical company, which is seeking to develop, acquire and commercialize, on its own or with partners, a portfolio of cancer therapies that address unmet medical needs. The Company is focused on developing products in immuno-oncology that employ gene expression, control and cell technologies to deliver cell- and viral-based therapies for the treatment of cancer and graft-versus-host-disease. It has developed an adenoviral vector, Ad-RTS-IL-12, which is administered intra-tumorally under the control of the RheoSwitch Therapeutic System (RTS) expression platform. Its initial clinical stage product candidate, which is being developed using the immuno-oncology platform is Ad-RTS-IL-12 + veledimex. Ad-RTS-IL-12 + veledimex uses its gene delivery system to produce interleukin-12. As of December 31, 2016, it had completed two Phase II studies evaluating Ad-RTS-IL-12 + veledimex, for the treatment of metastatic melanoma and metastatic breast cancer.

FINANCIAL RATIOS  of  ZIOPHARM Oncology (ZIOP)

Valuation Ratios
P/E Ratio -2.5
Price to Sales 58.2
Price to Book 8.5
Price to Tangible Book
Price to Cash Flow -7
Price to Free Cash Flow -6.9
Growth Rates
Sales Growth Rate 75%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -126.9%
Ret/ On Assets - 3 Yr. Avg. -100.7%
Return On Total Capital -244.4%
Ret/ On T. Cap. - 3 Yr. Avg. -173.3%
Return On Equity -244.4%
Return On Equity - 3 Yr. Avg. -173.3%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin -2357.1%
EBITDA Margin - 3 Yr. Avg. -2852.4%
Operating Margin -2357.1%
Oper. Margin - 3 Yr. Avg. -3252.4%
Pre-Tax Margin -2357.1%
Pre-Tax Margin - 3 Yr. Avg. -2852.4%
Net Profit Margin -2357.1%
Net Profit Margin - 3 Yr. Avg. -2852.4%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ZIOP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ZIOP stock intrinsic value calculation we used $6.389 million for the last fiscal year's total revenue generated by ZIOPHARM Oncology. The default revenue input number comes from 0001 income statement of ZIOPHARM Oncology. 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 ZIOP stock valuation model: a) initial revenue growth rate of 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 ZIOP is calculated based on our internal credit rating of ZIOPHARM Oncology, 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 ZIOPHARM Oncology.
    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 ZIOP stock the variable cost ratio is equal to 2516.7%.

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 ZIOP 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 ZIOPHARM Oncology.

Corporate tax rate of 27% is the nominal tax rate for ZIOPHARM Oncology. 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 ZIOP 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 ZIOP are equal to 17.1%.

Life of production assets of 2.8 years is the average useful life of capital assets used in ZIOPHARM Oncology 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 ZIOP is equal to -19.1%. 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 - $-96.806 million for ZIOPHARM Oncology - 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 131.84 million for ZIOPHARM Oncology 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 ZIOPHARM Oncology at the current share price and the inputted number of shares is $0.4 billion.

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COMPANY NEWS

▶ 3 Biotech Stocks That Soared This Week: Are They Buys?   [Aug-11-18 07:03AM  Motley Fool]
▶ Why Ziopharm Oncology Is Soaring 14% Today   [Aug-09-18 03:36PM  Motley Fool]
▶ Ziopharm: 2Q Earnings Snapshot   [06:32PM  Associated Press]
▶ Why Ziopharm Oncology Stock Zoomed 16.8% Higher Today   [Aug-07-18 04:00PM  Motley Fool]
▶ Why Ziopharm Oncology is Crashing by 17.7% Today   [Jun-18-18 04:10PM  Motley Fool]
▶ Is Ziopharm Oncology Inc. a Buy?   [Jun-17-18 07:17AM  Motley Fool]
▶ Why ZIOPHARM Oncology, Inc. Stock Broke Out in May   [Jun-09-18 02:01PM  Motley Fool]
▶ Here's What's Causing Intrexon to Tumble 20% Today   [May-11-18 04:00PM  Motley Fool]
▶ Ziopharm: 1Q Earnings Snapshot   [May-10-18 05:34PM  Associated Press]
▶ Is Ziopharm Oncology, Inc. a Buy?   [Apr-03-18 02:45PM  Motley Fool]
▶ Ziopharm reports 4Q loss   [Mar-01-18 04:59PM  Associated Press]
▶ CAR-T Therapy Space 2017 Progress Report   [Nov-24-17 01:06PM  Zacks]
▶ Ziopharm says its brain cancer drug helped trial patients live more than a year   [Nov-20-17 09:25AM  American City Business Journals]
▶ Ziopharm reports 3Q loss   [05:28PM  Associated Press]

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