Discounted Cash Flow Calculation for WSE:ENG 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.
WSE:ENG 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.
Energa's share price is below the future cash flow value, and at a moderate discount (> 20%).
Energa'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
is considered below, and whether this is a fair price.
Price based on past earnings
Energa's earnings available for a low price, and how does
this compare to other companies in the same industry?
Energa's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.
Energa's revenue is expected to grow by 4.3% 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.
Energa'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
1/6, 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
Ms. Alicja Barbara Klimiuk has been an Acting Chief Executive Officer of Energa SA since August, 2018 and serves as its Chief Operating Officer. Ms. Klimiuk serves as an Acting President of the Management Board at Energa SA and served as its Acting CEO until July 2, 2018. She served as Vice-President of Operations at Energa SA. Ms. Klimiuk serves as President at ENERGA-OPERATOR SA. She graduated from the Management Department of the University of Gdansk. She completed the Post-Graduate Course in Management at the Warsaw School of Economics and the Post-Graduate Course in Controlling in Corporate Management at the University of Gdansk.
Insufficient data for Alicja to compare compensation growth.
Alicja's remuneration is higher than average for companies of similar size in Poland.
Management Team Tenure
Average tenure of the
management team in years:
The tenure for the Energa management team is about average.
Acting President of Management Board
VP of Financial Matters & Member of Management Board
VP of Corporate Matters & Member of Management Board
Secretary of Supervisory Board
Manager of the Financial Reporting Unit & Chief Accountant
Head of Investor Relations
President of Energa Obrót
Board of Directors Tenure
Average tenure of the
board of directors in years:
The tenure for the Energa board of directors is about average.
Those Who Purchased Energa (WSE:ENG) Shares Five Years Ago Have A 55% Loss To Show For It
By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time. … Looking back five years, both Energa's share price and EPS declined; the latter at a rate of 0.8% per year. … Readers should note that the share price has fallen faster than the EPS, at a rate of 15% per year, over the period.
We'll show how you can use Energa SA's (WSE:ENG) P/E ratio to inform your assessment of the investment opportunity. … Energa has a price to earnings ratio of 4.24, based on the last twelve months. … Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Energa SA (WSE:ENG): Time For A Financial Health Check
While small-cap stocks, such as Energa SA (WSE:ENG) with its market cap of zł4.1b, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. … Evaluating financial health as part of your investment thesis is
by taking the expected future cash flows and discounting them to their present value. … discounted cash flows (DCF) … If you want to learn more about discounted cash flow, the basis for my calcs can be read in detail in the Simply Wall St analysis model.
I will take you through Energa’s cash flow health and the risk-return concept based on the stock’s cash flow yield, using the most recent financial data. … What is free cash flow. … Energa’s free cash flow (FCF) is the level of cash flow the business generates from its operational activities, after it reinvests in the company as capital expenditure
Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. … Energa has a market capitalization of zł3.7b, so we would expect some institutional investors to have noticed the stock. … institutional investors have bought into the company.
Examining Energa SA’s (WSE:ENG) Weak Return On Capital Employed
In particular, we'll consider its Return On Capital Employed (ROCE), as that can give us insight into how profitably the company is able to employ capital in its business. … Return On Capital Employed (ROCE): What is it? … ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business.
Does Energa SA's (WSE:ENG) P/E Ratio Signal A Buying Opportunity?
The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). … To keep it practical, we'll show how Energa SA's (WSE:ENG) P/E ratio could help you assess the value on offer. … Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Where Energa SA (WSE:ENG) Stands In Terms Of Earnings Growth Against Its Industry
Assessing Energa SA's (WSE:ENG) performance as a company requires looking at more than just a years' earnings data. … Below, I will run you through a simple sense check to build perspective on how Energa is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its electric utilities industry peers. … Did ENG's recent earnings growth beat the long-term trend and the industry.
Energa SA, together with its subsidiaries, generates, distributes, and sells electricity and heat in Poland. The company operates through Distribution, Generation, and Sales segments. It operates coal, hydropower, wind, biomass, and photovoltaic power plants with a total installed generation capacity of approximately 1.3 gigawatt of electrical power; and supplies electricity to approximately 3 million customers. It also sells electricity and gas to approximately 3 million customers. As of December 31, 2017, the company had 185 thousand kilometers of the power lines. The company was founded in 2006 and is based in Gdansk, Poland.
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