Discounted Cash Flow Calculation for DB:TT1 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:TT1 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.
TTM Technologies's share price is below the future cash flow value, and at a moderate discount (> 20%).
TTM Technologies'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
TTM Technologies's earnings available for a low price, and how does
this compare to other companies in the same industry?
TTM Technologies's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.
TTM Technologies's revenue is expected to grow by 3.1% 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.
TTM Technologies'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
3/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
TTM Technologies's finances.
The net worth of a company is the difference between its assets and liabilities.
TTM Technologies is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
TTM Technologies's long term commitments exceed its cash and other short term assets.
This treemap shows a more detailed breakdown of
TTM Technologies'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.
High level of physical assets or inventory.
Debt is not covered by short term assets, assets are 0.8x debt.
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
Mr. Thomas T. Edman, also known as Tom, served as Chief Executive Officer of SmartWorks at Techstep ASA. Mr. Edman has been the Chief Executive Officer of TTM Technologies Inc. since January 1, 2014 and its President since January 7, 2013. Mr. Edman served as President at Viasystems Group, Inc. since May 31, 2015. Mr. Edman served as Group Vice President of Applied Materials, Inc. from June 2006 to December 2012, Vice President of Corporate Business Development from June 2006 to June 2011 and served as its General Manager of Display Business Group from February 2011 to December 2012. He served as a Vice President of Applied Materials, Inc. He served as the Chief Executive Officer and President of Applied Films Corp. from May 1998 to July 2006. He was employed by Applied Films Corp. since June 1996. He served as the General Manager of Emerging Business Group at Applied Materials, Inc. From June 1996 to May 1998, Mr. Edman served as the Chief Operating Officer and Executive Vice President of Applied Films. From 1993 to June 1996, he served as the General Manager of the High Performance Materials Division of Marubeni Specialty Chemicals Inc. He has been a Director at Viasystems Group, Inc. since May 31, 2015. He has been a Director at TTM Technologies Inc. since September 2004 and Ultra Clean Holdings Inc. since June 2015. He served as a Director of Applied Films Corp. since July 1998. He serves on the National Board of Directors of the American Electronics Association, a professional trade organization. He served on the Governing Board of the USDC (United States Display Consortium). Mr. Edman serves on the board of directors of the c, an electronic industry association. Mr. Edman holds a Bachelor of Arts degree in East Asian studies (Japan) from Yale University and a Master’s degree in Business Administration from The Wharton School at the University of Pennsylvania.
Tom's compensation has been consistent with company performance over the past year.
Tom'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 TTM Technologies management team is about average.
Executive VP & COO
Executive VP & President of Commercial Sector
Senior Director of Corporate Development & Investor Relations
Senior Vice President of Marketing
Senior Vice President of Global Sales & E-MS
Senior Vice President of Human Resources
Executive Vice President of Asia Pacific Business Development
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the TTM Technologies board of directors is about average.
TTM Technologies, Inc., together with its subsidiaries, manufactures printed circuit boards (PCBs) worldwide. The company operates through two segments, PCB and E-M Solutions. The company offers a range of PCB products, radio-frequency (RF) components, and electro-mechanical solutions, including conventional PCBs, RF and microwave circuits, high density interconnect PCBs, substrate-like PCBs, flexible PCBs, rigid-flex PCBs, custom assemblies and system integration products, IC substrates, passive RF components, advanced ceramic RF components, multi-chip modules, and beamforming and switching networks. It also produces printed circuits with heavy copper cores, and embedded and press-fit coins; PCBs with electrically passive heat sinks; and PCBs with electrically active thermal cores. In addition, it offers various services, including design for manufacturability, PCB layout design, simulation and testing, and quick turnaround services. The company serves original equipment manufacturers and electronic manufacturing services companies that primarily serve the aerospace and defense, automotive, cellular phone, computing, medical/industrial/instrumentation, and networking/communications end markets of the electronics industry; and the U.S. government. TTM Technologies, Inc. was founded in 1978 and is headquartered in Costa Mesa, California.
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