Valuecruncher produces a valuation of NZ$1.07 for $RYM.NZ. This is a current valuation (an estimate of intrinsic value using a discounted cash flow model) not a target price. This valuation is 29.1% below the current share price of NZ$1.51.
- Revenue: Reuters aggregates four analysts covering $RYM.NZ and the mean estimates of 2009 and 2010 revenues are NZ$101.4 million and NZ$116.1 million respectively. For our analysis we have used NZ$100.0 million in 2009, NZ$115.0 million in 2010 and NZ$125.0 million in 2011.
- Profitability: We have used a flat EBITDA margin of 22.5% to 2011. Reuters has $RYM.NZ‘s EBITD margin at 21.7% last year and an average of 23.7% over the last five-years.
- Capital Expenditure: We have assumed capital expenditures of NZ$75.0 million in 2009, NZ$50 million in 2010 then NZ$25.0 million per annum moving forward. $RYM.NZ is still in an expansion mode and the high current capital expenditures show this.
- Discount Rate: 11.0%. The PwC New Zealand cost of capital report has $RYM.NZ at a WACC of 11.5% with the wider NZ market at 9.5%.
- Terminal Growth Rate: 4.0%.
Our analysis incorporates the cash and debt the $RYM.NZ balance sheet – Valuecruncher calculates a net debt number.
Play with our assumptions – what does your analysis say?