Discounted Cash Flow Calculation for NYSE:DY 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.
NYSE:DY 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
Dycom Industries's earnings available for a low price, and how does
this compare to other companies in the same industry?
Dycom Industries's earnings are expected to grow significantly at over 20% yearly.
Dycom Industries's revenue is expected to grow by 5% 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.
Dycom Industries'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.
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
Dycom Industries's finances.
The net worth of a company is the difference between its assets and liabilities.
Dycom Industries is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
Dycom Industries's cash and other short term assets cover its long term commitments.
This treemap shows a more detailed breakdown of
Dycom Industries'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 1.3x 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. Steven E. Nielsen, also known as Steve, has been the Chief Executive Officer and President at Dycom Industries Inc. since March 1999 and August 1996 respectively. Mr. Nielsen serves as the Chairman at Dycom Industries Inc. Chairman. Mr. Nielsen serves as a Vice President of Underground Specialties, LLC. He served as the Chief Operating Officer at Dycom Industries Inc., from August 1996 to March 1999 and Vice President from February 1996 to August 1996. Mr. Nielsen has been a Director of Dycom Industries Inc., since February 26, 1996. He served as a Director of SBA Communications Corp. from November 2001 to May 7, 2009.
Steve's compensation has been consistent with company performance over the past year.
Steve's remuneration is about average for companies of similar size in United States of America.
Management Team Tenure
Average tenure and age of the
management team in years:
The average tenure for the Dycom Industries management team is over 5 years, this suggests they are a seasoned and experienced team.
Executive VP & COO
VP & Chief Accounting Officer
VP & Chief Human Resources Officer
Vice President of Business Process
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the Dycom Industries board of directors is about average.
If You Had Bought Dycom Industries (NYSE:DY) Stock A Year Ago, You'd Be Sitting On A 56% Loss, Today
(NYSE:DY) have suffered share price declines over the last year. … In that relatively short period, the share price has plunged 56%. … In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business.
Is Now The Time To Look At Buying Dycom Industries, Inc. (NYSE:DY)?
led the NYSE gainers with a relatively large price hike in the past couple of weeks. … With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price? … However, could the stock still be trading at a relatively cheap price.
Why We’re Not Impressed By Dycom Industries, Inc.’s (NYSE:DY) 2.9% ROCE
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 is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business.
Despite Its High P/E Ratio, Is Dycom Industries, Inc. (NYSE:DY) Still Undervalued?
To keep it practical, we'll show how Dycom Industries, Inc.'s (NYSE:DY) P/E ratio could help you assess the value on offer. … Dycom Industries has a P/E ratio of 17.59, based on the last twelve months. … Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Does Dycom Industries, Inc. (NYSE:DY) Have A Particularly Volatile Share Price?
Some stocks mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. … Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). … A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one.
What Investors Should Know About Dycom Industries, Inc.'s (NYSE:DY) Financial Strength
(NYSE:DY) with its market cap of US$1.7b, 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. … I believe these basic checks tell most of the story you need to know.
Is Dycom Industries Inc's (NYSE:DY) ROE Of 12% Impressive?
Our data shows Dycom Industries has a return on equity of 12% for the last year. … One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.12 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity
Does Dycom Industries Inc's (NYSE:DY) CEO Pay Matter?
This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. … How Does Steve Nielsen's Compensation Compare With Similar Sized Companies. … According to our data, Dycom Industries Inc has a market capitalization of US$2.3b, and pays its CEO total annual compensation worth US$2.8m
Dycom Industries Inc (NYSE:DY): Time For A Financial Health Check
Small and large cap stocks are widely popular for a variety of reasons, however, mid-cap companies such as Dycom Industries Inc (NYSE:DY), with a market cap of US$2.2b, often get neglected by retail investors. … While they are less talked about as an investment category, mid-cap risk-adjusted returns have generally been better than more commonly focused stocks that fall into the small- or large-cap categories. … Today we will look at DY’s financial liquidity and debt levels, which are strong indicators for whether the company can weather economic downturns or fund strategic acquisitions for future growth.
Dycom Industries, Inc. provides specialty contracting services in the United States. The company offers various specialty contracting services, including program management, engineering, construction, maintenance, and installation services, such as placement and splicing of fiber, copper, and coaxial cables to telecommunications providers. It also provides tower construction, lines and antenna installation, and foundation and equipment pad construction for wireless carriers, as well as equipment installation and material fabrication, and site testing services; and installs and maintains customer premise equipment, such as digital video recorders, set top boxes, and modems for cable television system operators. In addition, the company offers construction and maintenance services for electric and gas utilities, and other customers; and underground facility locating services, such as locating telephone, cable television, power, water, sewer, and gas lines for various utility companies, including telecommunication providers. Dycom Industries, Inc. was founded in 1969 and is based in Palm Beach Gardens, Florida.
Simply Wall Street Pty Ltd (ACN 600 056 611), is a Corporate Authorised Representative (Authorised Representative Number: 467183) of Sanlam Private Wealth Pty Ltd (AFSL No. 337927). Any advice contained in this website is general advice only and has been prepared without considering your objectives, financial situation or needs. You should not rely on any advice and/or information contained in this website and before making any investment decision we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice. Please read our Financial Services Guide before deciding whether to obtain financial services from us.