de&allinfo=on&asxCode=TLS&companyName=&principalActivity=&industryGroup=NO”>ASX and NZX exchanges. The current share price is A$3.71 – the 52-week range has been A$4.95 to A$3.36. How is this in relation to the intrinsic value of the company’s shares?
Valuecruncher produces a valuation of A$3.57 for $TLS.AX. This is a current valuation (an estimate of intrinsic value using a discounted cash flow model) not a target price. This valuation is 3.8% below the current share price of A$3.71. All of the figures below are in Australian dollars (A$).
- Revenue: Reuters aggregates 10 analysts covering $TLS.AX and the mean estimates of 2009 and 2010 revenues are A$25.5 billion and A$26.1 billion respectively. For our analysis we have used A$25.25 billion in 2009, A$26.0 billion in 2010 and A$26.5 billion in 2011.
- Profitability: We have used an EBITDA margin of 41.5% flat to 2011. Reuters has $TLS.AX‘s EBITD margin at 41.7% last year and averaging 43.9% over the last five-years.
- Capital Expenditure: We have assumed capital expenditures of A$4.5 billion in 2009 then A$4.0 billion in 2010 and 2011 then A$4.5 billion per annum moving forward.
- Discount Rate: 9.0%.
- Terminal Growth Rate: 1.0%.
Our analysis incorporates the cash and debt on the $TLS.AX balance sheet – Valuecruncher calculates a net debt number.
Play with our assumptions – what does your analysis say?