Discounted Cash Flow Calculation for MUN:6LH using Excess Returns Model Model
The calculations below outline how an intrinsic value for LH Financial Group is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.
In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.
The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.
Amount off the current price
LH Financial Group
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
LH Financial Group
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
LH Financial Group's share price is below the future cash flow value, and at a moderate discount (> 20%).
LH Financial Group's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
LH Financial Group's
is considered below, and whether this is a fair price.
Price based on past earnings
LH Financial Group's earnings available for a low price, and how does
this compare to other companies in the same industry?
LH Financial Group's earnings are expected to grow by 4.5% yearly, however this is not considered high growth (20% yearly).
LH Financial Group's revenue is expected to grow by 8.9% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
LH Financial Group's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
LH Financial Group
has a total score of
3/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Fundamentally a bank's business is based upon borrowing and lending money, for
this reason they typically have high levels of debt and we analyse them
This treemap shows a more detailed breakdown of
LH Financial Group's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Mrs. Sasitorn Phongsathorn has been Chief Executive Officer of the LH Financial Group Public Company Limited and Land and Houses Bank Public Company Limited since January 31, 2018. Mrs. Phongsathorn has been the President at LH Financial Group Public Company Limited and Land and Houses Bank Public Company Limited since April 2009 and December 2005 respectively. Mrs. Phongsathorn serves as Director of Land and Houses Fund Management Company Limited. She served as the Managing Director of LH Financial Group Public Company Limited. She served as Chief Financial Officer of The Cogeneration PCL from November 1998 to July 1999. She served as Senior Executive Vice President of The Book Club Finance PCL since 2005 and served as its Vice President from Jul 2005 to December 2005. She served as Senior Vice President of Dhana Siam Finance and Securities Plc from September 1983 to July 1998. She served as the President of United Securities PCL from January 2004 to May 2005. She served as Senior Director of United Advisory Service Co.,Ltd from April 2000 to December 2003. Mrs. Phongsathorn has been an Executive Director of LH Financial Group Public Company Limited and Land and Houses Bank Public Company Limited since April 22, 2009 and December 21, 2005 respectively. She served as an Independent Director of Pico Thailand Public Company Limited since September 28, 2005 until September 15, 2017. She served as Member of Board of Governors at The Stock Exchange of Thailand until August 10, 2014. She served as a Director of United Securities Public Company Limited from January 2004 to June 1, 2005. She served as an Executive Director of AEC Securities Public Company Limited. Mrs. Phongsathorn has certificate of Director Certification Program, Certificate of Director Accreditation Program and Certificate of Financial Institutions Governance Program at Thai Institute of Directors Association. She is certificated Capital Market Academy Leadership Program at The Stock Exchange of Thailand. Mrs. Phongsathorn holds Bachelor of Science in Chemical Engineering from Chulalongkorn University and Master Degree in Business Administration from Notre Dame University, California, U.S.A. She has served as a Director of Land and Houses Fund Management Company Limited at Quality Houses Leasehold Property Fund.
Sasitorn's compensation has increased by more than 20% in the past year.
Sasitorn's remuneration is lower than average for companies of similar size in Germany.
CEO, President & Executive Director
Executive Vice President of Control Group
Board of Directors Tenure
Average tenure and age of the
LH Financial Group
board of directors in years:
The average tenure for the LH Financial Group board of directors is less than 3 years, this suggests a new board.
LH Financial Group Public Company Limited, an investment holding company, engages in banking business in Thailand. The company operates in four segments: Investment Holding Business, Banking Business, Fund Management Business, and Other Businesses. It accepts deposit products, such as demand deposits, savings deposits, time deposits, and fixed deposit receipts; and offers loans, including housing, retail, and commercial loans, as well as overdrafts. The company also provides funds; securities brokerage, trading, and underwriting services; and investment advisory services. LH Financial Group Public Company Limited was founded in 2009 and is based in Bangkok, Thailand.
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