Discounted Cash Flow Calculation for XTRA:SDF1 using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
XTRA:SDF1 DCF 1st Stage: Next 10 year cash flow forecast
Amount off the current price
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
K+S's share price is below the future cash flow value, and at a moderate discount (> 20%).
K+S's share price is below the future cash flow value, but not 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
is considered below, and whether this is a fair price.
Price based on past earnings
K+S's earnings available for a low price, and how does
this compare to other companies in the same industry?
K+S's earnings are expected to grow significantly at over 20% yearly.
K+S's revenue is expected to grow by 3% 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.
K+S'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.
has a total score of
0/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
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
Dr. Burkhard Lohr has been Chairman of the Board of Executive Directors at K+S Aktiengesellschaft since May 12, 2017 and has been its Member of Board of Executive Directors since June 01, 2012. Dr. Lohr is also Personnel Director at K+S Aktiengesellschaft since 2018. Dr. Lohr had been the Chief Financial Officer at K+S Aktiengesellschaft since March 14, 2012 Dr. Lohr served as the Chief Financial Officer and Labor Relations Director of Hochtief AG. He was responsible for Accounting, Tax, Risk Management, Financial and Investor Relations and Controlling of Hochtief. He joined to the Executive Board of HOCHTIEF construction AG in January 2002. He joined Hochtief in 1993 and has held various senior accounting and commercial positions. Dr. Lohr has experience in building, civil and structural engineering units. He served as a Member of the Executive Board of Hochtief AG from January 1, 2006 to October 18, 2011. Dr. Lohr served as a Non Executive Director of Leighton Holdings Ltd. from May 29, 2008 to October 12, 2011. He served as a Director of Leighton Finance (USA) Pty Ltd. Dr. Lohr is a graduate in Business Studies from Cologne University and received his Doctorate from the Technical University of Braunschweig in 2001.
Burkhard's compensation has been consistent with company performance over the past year, both up more than 20%.
Burkhard's remuneration is higher than average for companies of similar size in Germany.
Management Team Tenure
Average tenure and age of the
management team in years:
The tenure for the K+S management team is about average.
Chairman of the Board of Executive Directors
CFO & Member of Board of Executive Directors
COO & Member of Board of Executive Directors
Head of Corporate Communications
Head of Public Relations
Head of Public Affairs
Head of Online & Project Communications
Head of Representative Office Berlin
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the K+S board of directors is about average.
Board of Directors
Chairman of Supervisory Board
Deputy Chairman of Supervisory Board
Shareholder Representative Supervisory Board Member
K+S Aktiengesellschaft, together with its subsidiaries, produces and sells potash, magnesium, and salt products worldwide. Its Potash and Magnesium Products segment produces and markets mineral fertilizers, such as potassium chloride for various crops, including cereals, corn, rice, and soy beans; fertilizer specialties for rapeseeds, potatoes, citrus fruits, vines, and vegetables; potassium and magnesium products for industrial applications; and a range of products for use in pharmaceutical, cosmetics, food processing, and animal feed industries. The company’s Salt segment manufactures and markets consumer products, such as table salt, water softening salt for home use, and dishwater salt for end users, as well as kosher and low sodium salt; and salt for food processing, industrial salt, salt for chemical use, de-icing salt, and sodium chloride brine. Its Complementary Activities segment is involved in the underground disposal of waste in potash and rock salt mines and recycling activities; the granulation of animal hygiene products, such as CATSAN and THOMAS; and trading several basic chemicals, including caustic soda, nitric acid, sodium carbonate, calcium chloride, and magnesium chloride. K+S Aktiengesellschaft offers its products primarily under the CÉRÉBOS, ESCO, K+S-LOGO, MORTON, STIER, UMBRELLA GIRL, VATEL, WINDSOR, AXAL, REGENIT, SALDORO, ACTION MELT, SEASON-ALL, SYSTEM SAVER, BIOSAL, LOBOS, KADD, KORN-KALI, PATENTKALI, and KALISEL brands. The company was founded in 1889 and is headquartered in Kassel, Germany.
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