Discounted Cash Flow Calculation for NSEI:MIRCELECTR 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.
NSEI:MIRCELECTR 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.
MIRC Electronics's share price is below the future cash flow value, and at a moderate discount (> 20%).
MIRC Electronics'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
MIRC Electronics's earnings available for a low price, and how does
this compare to other companies in the same industry?
MIRC Electronics's earnings are expected to grow significantly at over 20% yearly.
Unable to determine if MIRC Electronics is high growth as no revenue estimate data is available.
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.
MIRC Electronics'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
2/6, 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
MIRC Electronics's finances.
The net worth of a company is the difference between its assets and liabilities.
MIRC Electronics is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
MIRC Electronics's cash and other short term assets cover its long term commitments.
This treemap shows a more detailed breakdown of
MIRC Electronics'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 covered by short term assets, assets are 3.7x 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. G. Sundar, C.A., I.C.W.A., A.C.S, has been Chief Executive Officer at MIRC Electronics Limited since January 31, 2014 and served as its Director of Strategy since July 10, 2013 until June 2, 2017. Mr. Sundar served as its Chief Executive Officer at MIRC Electronics Limited until July 10, 2013. He joined MIRC in 1985 and headed its Finance function till 1997, when he took over as the Executive Vice President. He has largely been responsible for building MIRC into one of the most financially stable companies in the country.
G.'s compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
G.'s remuneration is higher than average for companies of similar size in India.
Management Team Tenure
Average tenure and age of the
management team in years:
The tenure for the MIRC Electronics management team is about average.
Chief Executive Officer
Head of Corporate Affairs & Legal
Whole Time Director
Vice President of Strategy
Whole Time Director & VP of Operation
Assistant General Manager of Marketing
Chief Human Resource Officer
Deputy Company Secretary
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the MIRC Electronics board of directors is less than 3 years, this suggests a new board.
Why You Should Care About MIRC Electronics Limited’s (NSE:MIRCELECTR) Low Return On Capital
To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business. … What is Return On Capital Employed (ROCE)? … ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business.
Do Insiders Own Shares In MIRC Electronics Limited (NSE:MIRCELECTR)?
Every investor in MIRC Electronics Limited (NSE:MIRCELECTR) should be aware of the most powerful shareholder groups. … Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. … MIRC Electronics is a smaller company with a market capitalization of ₹5.1b, so it may still be flying under the radar of many institutional investors.
Announcing: MIRC Electronics (NSE:MIRCELECTR) Stock Soared An Exciting 371% In The Last Five Years
For example, the MIRC Electronics Limited (NSE:MIRCELECTR) share price is up a whopping 371% in the last half decade, a handsome return for long term holders. … Given that MIRC Electronics only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. … As a general rule, if the market is looking past earnings to focus on revenue, there is a hope for, or expectation of, strong growth.
How Should Investors React To MIRC Electronics Limited's (NSE:MIRCELECTR) CEO Pay?
This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. … See our latest analysis for MIRC Electronics. … Sundar's Compensation Compare With Similar Sized Companies?.
Should You Be Concerned About MIRC Electronics Limited's (NSE:MIRCELECTR) ROE?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. … One way to conceptualize this, is that for each ₹1 of shareholders' equity it has, the company made ₹0.015 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity
Is MIRC Electronics Limited (NSE:MIRCELECTR) Attractive At This PE Ratio?
MIRC Electronics Limited (NSE:MIRCELECTR) is trading with a trailing P/E of 28.8, which is higher than the industry average of 20.5. … I will deconstruct the P/E ratio and highlight what you need to be careful of when using the P/E ratio … Check out our latest analysis for MIRC Electronics
Why MIRC Electronics Limited's (NSE:MIRCELECTR) ROE Of 9.90% Does Not Tell The Whole Story
and want to start learning about core concepts of fundamental analysis on practical examples from today's market. … MIRC Electronics Limited (NSE:MIRCELECTR) delivered an ROE of 9.90% over the past 12 months, which is relatively in-line with its industry average of 12.25% during the same period. … Check out our latest analysis for MIRC Electronics
How Much is MIRC Electronics Limited's (NSE:MIRCELECTR) CEO Getting Paid?
Sundar is the CEO of MIRC Electronics Limited (NSE:MIRCELECTR), which has recently grown to a market capitalization of ₹7.30bG … Incentives can be in the form of compensation, which should always be structured in a way that promotes value-creation to shareholders. … Check out our latest analysis for MIRC Electronics
Is MIRC Electronics Limited's (NSE:MIRCELECTR) PE Ratio A Signal To Buy For Investors?
and want to better understand how you can grow your money by investing in MIRC Electronics Limited (NSE:MIRCELECTR). … MIRC Electronics Limited (NSE:MIRCELECTR) is trading with a trailing P/E of 29.8x, which is lower than the industry average of 38.3x. … Although some investors may jump to the conclusion that this is a great buying opportunity, understanding the assumptions behind the P/E ratio might change your mind
What You Must Know About MIRC Electronics Limited's (NSE:MIRCELECTR) Financial Strength
How does MIRCELECTR’s operating cash flow stack up against its debt? … On top of this, MIRCELECTR has generated IN₨378.24M in operating cash flow during the same period of time, leading to an operating cash to total debt ratio of 22.60%, meaning that MIRCELECTR’s operating cash is sufficient to cover its debt. … Furthermore, its cash flow coverage of less than a quarter of debt means that operating efficiency could also be an issue.
MIRC Electronics Limited manufactures and markets electronics and consumer durables in India. It offers LED and LCD televisions, air conditioners, washing machines, microwave ovens, DVD and home theatre systems, mobile phones, projector systems, and LED lights under the Onida brand. The company also exports its products. MIRC Electronics Limited was founded in 1981 and is based in Mumbai, India.
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