LivaNova PLC (NASDAQ:LIVN) Shares Could Be 36% Below Their Intrinsic Value Estimate
LivaNova PLC (NASDAQ:LIVN) Shares Could Be 36% Below Their Intrinsic Value Estimate
Key Insights
主要见解
- The projected fair value for LivaNova is US$75.63 based on 2 Stage Free Cash Flow to Equity
- LivaNova's US$48.34 share price signals that it might be 36% undervalued
- Analyst price target for LIVN is US$68.90 which is 8.9% below our fair value estimate
- LivaNova的预测公允价值为75.63美元,基于2阶段自由现金流到股本
- LivaNova的48.34美元的股价表明它可能被低估了36%
- LIVN的分析师目标价为68.90美元,低于我们的公允价值估计8.9%
Does the August share price for LivaNova PLC (NASDAQ:LIVN) reflect what it's really worth? Today, we will estimate the stock's intrinsic value by taking the expected future cash flows and discounting them to today's value. Our analysis will employ the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
8月份LivaNova PLC(NASDAQ:LIVN)的股价是否反映了它真正的价值?今天,我们将通过将预期未来现金流折现到现值来估计股票的内在价值。我们的分析将使用折现现金流量(DCF)模型。听起来可能很复杂,但实际上它非常简单!
We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model.
我们要警告的是,有很多方法来对公司进行估值,就像DCF一样,每种技术在某些情况下都有优点和缺点。如果您想了解更多关于折现现金流的信息,可以在Simply Wall St分析模型中详细阅读这个计算背后的推理。
The Method
方法
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
我们正在使用2阶段增长模型,这意味着我们考虑公司的两个增长阶段。在最初的阶段,公司可能具有更高的增长率,第二阶段通常假定具有稳定的增长率。首先,我们需要估计未来十年的现金流。如果有可能,我们使用分析师的估计,但当这些估计不可获得时,我们会利用上一个自由现金流(FCF)的估计或报告的价值进行推算。我们假设自由现金流不断萎缩的公司将会减缓萎缩速度,而流动自由现金不断增长的公司将会在此期间看到其增长率放缓。我们这样做是为了反映增长趋势在早期年份比后期年份更容易放缓。
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value:
DCF的核心概念是未来的每一美元都比现在的每一美元更不值钱,因此我们将这些未来的现金流贴现到当今的价值:
10-year free cash flow (FCF) forecast
10年自由现金流(FCF)预测
2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 | 2033 | 2034 | |
Levered FCF ($, Millions) | US$476.0m | US$299.0m | US$488.0m | US$252.0m | US$231.4m | US$219.9m | US$213.9m | US$211.4m | US$211.2m | US$212.7m |
Growth Rate Estimate Source | Analyst x1 | Analyst x1 | Analyst x1 | Analyst x1 | Est @ -8.18% | Est @ -4.98% | Est @ -2.73% | Est @ -1.16% | Est @ -0.06% | Est @ 0.70% |
Present Value ($, Millions) Discounted @ 7.6% | US$442 | US$258 | US$392 | US$188 | US$161 | US$142 | US$128 | US$118 | US$109 | US$102 |
2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 | 2033 | 2034 | |
杠杆自由现金流 ($, 百万) | 估计@ -4.98% | 2.99亿美元 | 2.52亿美元 | Est @ 0.70% | Present Value ($万s) Discounted @ 7.6% | US$109 | 211.4百万美元 | ("Est" = FCF growth rate estimated by Simply Wall St) | 现在我们需要计算终值,该值考虑了这十年期之后的所有未来现金流。由于很多原因,使用了一个非常保守的增长率,该增长率不能超过一个国家的GDP增长率。在这种情况下,我们使用了10年期政府债券收益率的5年平均值(2.5%)来估计未来的增长。与10年期“增长”期的情况一样,我们将未来的现金流折现到今天的价值,使用的是股权成本率为7.6%。 | |
增长率估计来源 | 分析师x1 | 分析师x1 | 分析师x1 | 分析师x1 | 估计为-8.18% | Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! | 以-2.73%的估值为基础 | 预计@-0.06% | 预计增长率为0.70% | |
以7.6%的贴现率贴现后的现值(百万美元)。 | 442美元 | 美元258 | US $ 392 | 美元188 | 161美元 | 美元142 | 128百万美元 | 118美元 | 美元109 | 102美元 |
("Est" = FCF growth rate estimated by Simply Wall St)
Present Value of 10-year Cash Flow (PVCF) = US$2.0b
("Est" = Simply Wall St 估计的自由现金流增长率)
10年现金流的现值(PVCF) = 20亿美元
We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (2.5%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 7.6%.
Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$213m× (1 + 2.5%) ÷ (7.6%– 2.5%) = US$4.3b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$4.3b÷ ( 1 + 7.6%)10= US$2.1b
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is US$4.1b. In the final step we divide the equity value by the number of shares outstanding. Compared to the current share price of US$48.3, the company appears quite undervalued at a 36% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent.
![1724927036120](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240829/43059199-0-a18f29cac13b357b3c9cbd993dd5abff.webp/bigjpg)
Important Assumptions
重要假设
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at LivaNova as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.6%, which is based on a levered beta of 1.048. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Next Steps:
下一步:
Although the valuation of a company is important, it is only one of many factors that you need to assess for a company. DCF models are not the be-all and end-all of investment valuation. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" For instance, if the terminal value growth rate is adjusted slightly, it can dramatically alter the overall result. Can we work out why the company is trading at a discount to intrinsic value? For LivaNova, there are three important elements you should further research:
- Financial Health: Does LIVN have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Future Earnings: How does LIVN's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing!
- 其他高质量选择:你喜欢一个好的多面手吗?浏览我们的高质量股票交互列表,了解还有哪些你可能错过的好东西!
PS. Simply Wall St updates its DCF calculation for every American stock every day, so if you want to find the intrinsic value of any other stock just search here.
PS. Simply Wall St每天都会更新其对每只美国股票的折现现金流计算,因此,如果你想找到其他股票的内在价值,只需在此搜索即可。
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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这篇文章是Simply Wall St的一般性文章。我们根据历史数据和分析师预测提供评论,只使用公正的方法论,我们的文章并不意味着提供任何金融建议。文章不构成买卖任何股票的建议,也不考虑您的目标或您的财务状况。我们的目标是带给您基本数据驱动的长期关注分析。请注意,我们的分析可能不考虑最新的价格敏感公司公告或定性材料。Simply Wall St没有任何股票头寸。