Discounted Cash Flow Calculation for NYSE:FND using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
Floor & Decor Holdings
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:FND DCF 1st Stage: Next 10 year cash flow forecast
The current share price of
Floor & Decor Holdings
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
Floor & Decor Holdings's
is considered below, and whether this is a fair price.
Price based on past earnings
Floor & Decor Holdings's earnings available for a low price, and how does
this compare to other companies in the same industry?
Floor & Decor Holdings's earnings are expected to grow by 19.1% yearly, however this is not considered high growth (20% yearly).
Floor & Decor Holdings's revenue is expected to grow by 16.3% 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.
Floor & Decor Holdings'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.
Floor & Decor Holdings
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
Floor & Decor Holdings's finances.
The net worth of a company is the difference between its assets and liabilities.
Floor & Decor Holdings is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
Floor & Decor Holdings's long term commitments exceed its cash and other short term assets.
This treemap shows a more detailed breakdown of
Floor & Decor Holdings'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 3.6x 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. Thomas V. Taylor, Jr., also known as Tom, has been the Chief Executive Officer of Floor & Decor Holdings, Inc (formerly FDO Holdings, Inc). since December 2012. He serves as Chief Executive Officer and a Member of Board at Floor and Decor Outlets of America, Inc. Mr. Taylor has been Director at National Vision Holdings, Inc. since September 10, 2018. Mr. Taylor began his career in 1983 at Miami Home Depot store. He worked his way up through various Manager, District Manager, Vice President, President and Senior Vice President roles and served as Executive Vice President of Operations with responsibility for all 2,200 Home Depot stores and then Executive Vice President of Merchandising and Marketing, again for all stores. After leaving Home Depot in 2006, Mr. Taylor served as Managing Director at Sun Capital Partners. During his tenure, he was a board member for over twenty portfolio companies in the United States and Europe. He has been Director of Floor & Decor Holdings, Inc since December 2012.
Tom's compensation has been consistent with company performance over the past year, both up more than 20%.
Tom's remuneration is about average for companies of similar size in United States of America.
Management Team Tenure
Average tenure and age of the
Floor & Decor Holdings
management team in years:
The average tenure for the Floor & Decor Holdings management team is over 5 years, this suggests they are a seasoned and experienced team.
CEO & Director
Executive VP & CFO
Executive VP & Chief Merchandising Officer
Executive Vice President of Business Development Strategy
Senior Manager of Investor Relations
Vice President of Investor Relations
Board of Directors Tenure
Average tenure and age of the
Floor & Decor Holdings
board of directors in years:
The tenure for the Floor & Decor Holdings board of directors is about average.
Why Floor & Decor Holdings, Inc. (NYSE:FND) Is A Financially Healthy Company
With this growth in debt, FND's cash and short-term investments stands at US$451k , ready to be used for running the business. … Moreover, FND has produced cash from operations of US$172m over the same time period, resulting in an operating cash to total debt ratio of 19%, signalling that FND’s current level of operating cash is not high enough to cover debt. … With current liabilities at US$398m, it seems that the business has been able to meet these obligations given the level of current assets of US$527m, with a current ratio of 1.32x.
Is Floor & Decor Holdings, Inc.'s (NYSE:FND) Balance Sheet A Threat To Its Future?
On top of this, FND has generated US$172m in operating cash flow during the same period of time, leading to an operating cash to total debt ratio of 19%, signalling that FND’s debt is not covered by operating cash. … Looking at FND’s US$398m in current liabilities, it appears that the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.32x. … Next Steps: FND’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow.
Floor & Decor Holdings, Inc. (NYSE:FND) Insiders Increased Their Holdings
So before you buy or sell Floor & Decor Holdings, Inc. … Floor & Decor Holdings Insider Transactions Over The Last Year … In the last twelve months, the biggest single purchase by an insider was when Independent Director Felicia Thornton bought US$98k worth of shares at a price of US$37.82 per share
Investors Who Bought Floor & Decor Holdings (NYSE:FND) Shares A Year Ago Are Now Down 18%
But in truth the last year hasn't been good for the share price. … One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price. … During the unfortunate twelve months during which the Floor & Decor Holdings share price fell, it actually saw its earnings per share (EPS) improve by 6.6%.
Floor & Decor Holdings, Inc. (NYSE:FND): Exploring Free Cash Flows
I’ve analysed below, the health and outlook of Floor & Decor Holdings’s cash flow, which will help you understand the stock from a cash standpoint. … Floor & Decor Holdings generates cash through its day-to-day business, which needs to be reinvested into the company in order for it to continue operating. … I will be analysing Floor & Decor Holdings’s FCF by looking at its FCF yield and its operating cash flow growth.
Why Floor & Decor Holdings, Inc. (NYSE:FND) Could Have A Place In Your Portfolio
Looking at the company as a whole, as a potential stock investment, I believe FND has a lot to offer. … is a company with great financial health as well as a. … If you're interested in understanding beyond my broad commentary,
Has Floor & Decor Holdings, Inc. (NYSE:FND) Improved Earnings Growth In Recent Times?
Below, I will examine Floor & Decor Holdings, Inc.'s (NYSE:FND) track record on a high level, to give you some insight into how the company has been performing against its long term trend and its industry peers. … Did FND's recent earnings growth beat the long-term trend and the industry. … However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 45%, indicating the rate at which FND is growing has slowed down
Despite Its High P/E Ratio, Is Floor & Decor Holdings, Inc. (NYSE:FND) Still Undervalued?
This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). … We'll look at Floor & Decor Holdings, Inc.'s (NYSE:FND) P/E ratio and reflect on what it tells us about the company's share price. … Floor & Decor Holdings has a P/E ratio of 32.07, based on the last twelve months.
All You Need To Know About Floor & Decor Holdings, Inc.'s (NYSE:FND) Financial Health
Small and large cap stocks are widely popular for a variety of reasons, however, mid-cap companies such as Floor & Decor Holdings, Inc. … Let’s take a look at FND’s debt concentration and assess their financial liquidity to get an idea of their ability to fund strategic acquisitions and grow through cyclical pressures. … Check out our latest analysis for Floor & Decor Holdings
Floor & Decor Holdings, Inc. operates as a multi-channel specialty retailer of hard surface flooring and related accessories. The company’s stores offer tile, wood, laminate, vinyl, and natural stone flooring products, as well as decorative and installation accessories. It serves professional installers, commercial businesses, and do it yourself customers. As of December 27, 2018, the company operated 100 warehouse-format stores; and a small-format standalone design center in 28 states. Floor & Decor Holdings, Inc. also sells products through its Website, FloorandDecor.com. The company was formerly known as FDO Holdings, Inc. and changed its name to Floor & Decor Holdings, Inc. in April 2017. Floor & Decor Holdings, Inc. was founded in 2000 and is headquartered in Atlanta, Georgia.
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