Discounted Cash Flow Calculation for DB:KUD 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.
DB:KUD 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.
Kudelski's share price is below the future cash flow value, but not at a moderate discount (< 20%).
Kudelski'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
Kudelski's earnings available for a low price, and how does
this compare to other companies in the same industry?
Kudelski's earnings are expected to grow significantly at over 20% yearly.
Kudelski's revenue is expected to grow by 1.7% 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.
Kudelski'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
Mr. André Kudelski serves as Member of Supervisory Board at Publicis Groupe S.A. since May 25, 2016. Mr. Kudelski began his career in 1984 within the Kudelski SA company as an R&D engineer. In 1989, he became Director of Nagravision SA, in 1991 as Chair and Chief Executive Officer of the Kudelski Group. He is a Director of HSBC Private Banking Holdings (Switzerland) SA and first Vice- Chairman/Premier Vice-President of the Board of Directors at Geneva International Airport. He is Chairman of the Board of Directors of lnnosuisse. He was a Director of Nestlé, Dassault Systèmes and Edipresse SA. He has received numerous distinctions, including the title of “Global Leader for Tomorrow” from the World Economic Forum in 1995 and an Emmy® Award in 1996 from the National Academy of Arts and Sciences, recognizing his work in controlling access to television. He is Chair and Deputy Director of Kudelski SA and Nagra Plus SA (Switzerland). He is Chair of the Board of Directors of Conax AS (Norway), SmarDTV SA (Switzerland), Innosuisse (public law) (Switzerland) and Restaurant de l’Hôtel de Ville Benoît Violier SA (Switzerland). He is Co-Chair of NagraStar LLC (United States). He is Chair and Chief Executive Officer of Nagra USA, Inc. (United States), Kudelski Corporate, Inc. (United States), Kudelski Security Holdings, Inc. (United States) and Open TV, Inc. (United States). He Executive Chair of Kudelski Security, Inc. (United State). He is Vice-Chair of Geneva International Airport (public law) (Switzerland) and Swiss-American Chamber of Commerce (association) (Switzerland). He is Member of the Supervisory Board of Skidata AG (Austria). He is Director of RSH Quality Food Concept SA (Switzerland), Automotive Trade Finance SA (Switzerland), Sunset Music SA (Switzerland) and Greater Phoenix Economic Council (GPEC). He is Member of the Strategy Advisory Board of Foundation of the École Polytechnique Fédérale de Lausanne (Switzerland). He was Director of HSBC Private Banking Holdings SA (Switzerland) until December 31, 2017. He was Director of Nestlé SA until April 2013. He was Director of Dassault Systèmes SA until May 2013. He was Director at Edipresse SA until September 2013.
André's compensation has been consistent with company performance over the past year.
André'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 average tenure for the Kudelski management team is over 5 years, this suggests they are a seasoned and experienced team.
CFO, Executive VP & Member of Executive Board
Chief Marketing Officer of Digital TV
COO of Digital TV
Chief Information Officer
VP & Head of Investor Relations
General Counsel & Corporate Secretary
Head of Group Human Resources & Senior VP
Executive VP & CEO of Nagra Public Access
Head of Marketing & Communications of Nagravision Sa
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the Kudelski board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Kudelski SA provides digital security and convergent media solutions for the delivery of digital and interactive content worldwide. It operates through Integrated Digital Television and Public Access segments. The Integrated Digital Television segment offers end-to-end integrated solutions, including open conditional access solutions allowing digital TV operators and content providers to operate various value-added pay TV services on a secure platform, and middleware software solutions for set-top boxes and other consumer devices. The Public Access segment provides access control systems and ticketing services for ski lifts, car parks, stadiums, concert halls, and other events. The company also offers cyber and media security solutions to enterprises and public sector institutions; finance services; intellectual property consulting services; research and development services; and watermarking solutions, as well as operates as a travel agency. In addition, it offers smartcards and digital TV sales and support services. Kudelski SA was founded in 1951 and is headquartered in Cheseaux-sur-Lausanne, Switzerland.
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