Discounted Cash Flow Calculation for NYSE:XYF using Excess Returns Model Model
The calculations below outline how an intrinsic value for X Financial is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.
In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.
The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.
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.
X Financial's share price is below the future cash flow value, and at a moderate discount (> 20%).
X Financial'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
X Financial's earnings available for a low price, and how does
this compare to other companies in the same industry?
X Financial's earnings are expected to grow by 1.1% yearly, however this is not considered high growth (20% yearly).
X Financial's revenue is expected to grow significantly at over 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.
X Financial'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. Yue Tang, also known as Justin is a Founding Partner at Blue Ridge China Partners. Mr. Tang is Founder, Chief Executive Officer and Chairman of X Financial. Mr. Tang co-founded eLong Inc. in 1999 and served as its President and Chief Executive Officer from 2001 to January 23, 2006. From 2000 to 2001, Mr. Tang founded and served as President and Executive Director of Asia.com. He also Co-founded Blue Ridge China in 2006. Prior to eLong.com, Mr. Tang served as Vice President at Oscar Gruss & Son Inc. He served as an Equity Analyst of Oscar Gruss and Son Inc., Research Division. He also worked for Brookehill Partners Inc., and Merrill Lynch & Co., and has 7 years of experience in venture capital & investment banking. He served as the Chairman of eLong Inc. of Expedia Inc. from 2001 to July 27, 2006. Mr. Tang serves as Director of ITAT Group Limited. He served as a Director of eLong Inc. from April 2001 to June 10, 2011. Mr. Tang served as an Independent Director of ChinaCast Education Corporation from 2001 to January 10, 2012. He served as an Independent Non-Executive Director of International Elite Limited from September 2007 to June 3, 2011. He served as Independent Director of Xinyuan Real Estate Company Ltd., from August 2006 to February 28, 2011. He served as a Director of PacificNet Inc. (formerly, Creative Master International Inc.) since December 30, 2002. Mr. Tang studied at Nanjing University in China and received his B.S. degree from Concordia College in the United States.
Insufficient data for Justin to compare compensation growth.
Insufficient data for Justin to establish whether their remuneration is reasonable compared to companies of similar size in United States of America.
Management Team Tenure
Average tenure and age of the
management team in years:
The tenure for the X Financial management team is about average.
President & Director
Chief Financial Officer
CTO & Director
Chief Risk Officer
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the X Financial board of directors is less than 3 years, this suggests a new board.
What Kind Of Investor Owns Most Of X Financial (NYSE:XYF)?
Every investor in X Financial (NYSE:XYF) should be aware of the most powerful shareholder groups. … Conversely, insiders often decrease their ownership over time. … Taking a look at our data on the ownership groups (below), it's seems that.
What Kind Of Shareholders Own X Financial (NYSE:XYF)?
A look at the shareholders of X Financial (NYSE:XYF) can tell us which group is most powerful. … Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. … institutions don't own many shares in the company
X Financial provides personal finance services in the People's Republic of China. The company offers a suite of products connecting borrowers and investors through a proprietary Internet platform. It provides loan products, which include Xiaoying card loan and Xiaoying preferred loan; and investment opportunities through wealth management platform, Xiaoying wealth management with insurance protection. X Financial was founded in 2014 and is headquartered in Shenzhen, the People's Republic of China.
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