Discounted Cash Flow Calculation for OM:THQN B 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.
OM:THQN B DCF 1st Stage: Next 10 year cash flow forecast
The current share price of
is above its future cash flow value.
Often investors are willing to pay a
for a company that has a high dividend or the potential for future growth.
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
THQ Nordic's earnings available for a low price, and how does
this compare to other companies in the same industry?
THQ Nordic's earnings are expected to grow significantly at over 20% yearly.
THQ Nordic's revenue is expected to grow by 8.8% 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.
THQ Nordic'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.
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.
Mr. Lars Wingefors is founder of Lars Wingefors AB. Mr. Wingefors is also the founder of THQ Nordic AB (publ) (formerly, Nordic Games Holding AB) and serves as its Chief Executive Officer. He is a Founder of Game Outlet Europe AB. He served as an Investment Advisor at Wingefors Invest AB. He has been Director of Wingefors Invest since January 21, 2014. He serves as Director of Inission AB. He has been a Director at THQ Nordic AB (publ) since 2002, Carlmark Sweden AB since 2015, Handelskammaren Värmland since May 2016 and Lars Wingefors AB since 2006.
Lars's compensation has been consistent with company performance over the past year, both up more than 20%.
Lars's remuneration is lower than average for companies of similar size in Sweden.
Managing Director of THQ Nordic GmbH
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the THQ Nordic board of directors is about average.
THQ Nordic AB (publ) (STO:THQN B) Might Not Be A Great Investment
Analysts use this formula to calculate return on capital employed: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for THQ Nordic: 0.045 = kr185m ÷ (kr6.4b - kr2.3b) (Based on the trailing twelve months to December 2018.) So, THQ Nordic has an ROCE of 4.5%. … What Are Current Liabilities, And How Do They Affect THQ Nordic's ROCE? … The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise.
Do Institutions Own THQ Nordic AB (publ) (STO:THQN B) Shares?
Taking a look at our data on the ownership groups (below), it's seems that institutions own shares in the company. … But other times, private equity is selling out, having taking the company public. … Private Company Ownership Our data indicates that Private Companies hold 20%, of the company's shares.
Does THQ Nordic AB (publ) (STO:THQN B) Have A Volatile Share Price?
Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. … Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). … A stock with a beta below one is either less volatile than the market, or more volatile but not corellated with the overall market.
If You Like EPS Growth Then Check Out THQ Nordic (STO:THQN B) Before It's Too Late
Like a puppy chasing its tail, some new investors often chase 'the next big thing', even if that means buying 'story stocks' without revenue, let alone profit. … Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. … While THQ Nordic did well to grow revenue over the last year, EBIT margins were dampened at the same time.
Is THQ Nordic AB (publ) (STO:THQN B) As Strong As Its Balance Sheet Indicates?
Let’s take a look at THQN B’s debt concentration and assess their financial liquidity to get an idea of their ability to fund strategic acquisitions and grow through cyclical pressures. … Note that this commentary is very high-level and solely focused on financial health, so I suggest you dig deeper yourself. … Is THQN B’s debt level acceptable?
Is Now The Time To Look At Buying THQ Nordic AB (publ) (STO:THQN B)?
As a well-established company, which tends to be well-covered by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock? … Today I will analyse the most recent data on THQ Nordic’s outlook and valuation to see if the opportunity still exists
The THQ Nordic Share Price Is Up 28% And Shareholders Are Holding On
To wit, the THQ Nordic AB (publ) (STO:THQN B) share price is 28% higher than it was a year ago, much better than the market return of around 0.9% (not including dividends) in the same period. … To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. … One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
THQ Nordic AB (publ), together with its subsidiaries, acquires, develops, and publishes PC and console games for the gaming market worldwide. The company’s game portfolio consists of owned franchises and published titles. It also publishes game titles for various strategic partners. The company distributes games through retailers and digital distributors. In addition, it operates as an independent film distributor and co-producer. The company was formerly known as Nordic Games and changed its name to THQ Nordic AB (publ) in August 2016. THQ Nordic AB (publ) was incorporated in 1999 and is headquartered in Karlstad, Sweden.
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