The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value. We use
analyst's estimates of cash flows going forward 5 years.
See our documentation to learn about this calculation.
|Levered FCF (USD, Millions)||$-681.80||$-334.16||$77.89||$916.55||$1,543.05|
|Source||Analyst x10||Analyst x9||Analyst x7||Analyst x2||Analyst x2|
Discounted (@ 9.58%)
Present value of next 5 years cash flows:
Terminal Value = FCF2022 × (1 + g) ÷ (Discount Rate – g)
Terminal Value = $1,543 × (1 + 2.47%) ÷ (9.58% – 2.47%)
Terminal value based on the Perpetuity Method where growth (g) =
Present value of terminal value:
Equity Value (Total value) = Present value of next 5 years cash flows +
$14,857 = $771 + $14,086
Value = Total value / Shares Outstanding ($14,857 / 1,222)Discount to Share Price
Value per share:
Current discount (share price of $17.45): -43.55%
The discount rate, or required rate of return, is estimated by calculating the Cost of Equity.
Discount rate = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
Discount rate = 9.58% = 2.47% + (0.944 * 7.53%)
The Levered Beta is the Unlevered Beta adjusted for financial leverage. It is limited to 0.8 to 2.0 (practical range for a stable firm). Note the market value of equity is used not the book value ($21,400,757,020).
Levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
0.944 = 0.944 (1 + (1- 40%) (0%))
Levered Beta used in calculation = 0.944
Mr. Evan Spiegel is a Co-Founder of Snap Inc. and serves as its President. Mr. Spiegel has been Chief Executive Officer and Director of Snap Inc. since May 2012. Mr. Spiegel has been a Trustee of The Paley Center for Media since October 2017.
Average tenure and age of the Snap management team in years:
Average tenure and age of the Snap board of directors in years:
View our latest analysis for Snap What has SNAP's performance been like? … Most recently, SNAP released negative earnings of -US$3.45B , which is a further decline from prior year's loss of -US$514.64M. … Usually I would use earnings and market cap to account for variations in performance, however, SNAP's negative earnings lower the effectiveness of this method.Simply Wall St - – Full article
Cash is crucial to run a business, and if a company burns through its reserves fast, it will need to come back to market for additional capital raising. … NYSE:SNAP Income Statement Feb 14th 18 When will Snap need to raise more cash? … This means that, if Snap continues to grow its opex at this rate, given how much money it currently has in the bank, it will actually need to raise capital again in within the next 7 months!Simply Wall St - – Full article
Tech analysts are forecasting for the entire software tech industry, a strong double-digit growth of 13.36% in the upcoming year , and an overall negative growth rate in the next couple of years. … Below, I will examine the sector growth prospects, as well as evaluate whether Snap is lagging or leading its competitors in the industry. … If Snap has been on your watchlist for a while, now may be the time to enter into the stock, if you like its growth prospects and are not highly concentrated in the tech industry.Simply Wall St - – Full article
Free cash flow (FCF) is the amount of cash Snap has left after it pays off its expenses, including its net capital expenditures, which is what the company needs to spend each year to maintain or grow its business operations. … Free Cash Flow = Operating Cash Flows – Net Capital Expenditure Free Cash Flow Yield = Free Cash Flow / Enterprise Value where Enterprise Value = Market Capitalisation + Net Debt Along with a positive operating cash flow, Snap also generates a positive free cash flow. … Current +1 year +2 year +3 year Operating Cash Flow (OCF) $-726M $-726M $-497M $-201M OCF Growth Year-On-Year -0.00086% -31.53% -59.54% OCF Growth From Current Year -31.58% -72.32% Next Steps: Low free cash flow yield means you are not currently well-compensated for the risk you’re taking on by holding onto Snap relative to a well-diversified market index.Simply Wall St - – Full article
With this increase in debt, the current cash and short-term investment levels stands at $987.4M , ready to deploy into the business. … For Snap, investors should not worry about its debt levels because the company has very, very little on its balance sheet! … Investors' risk associated with debt is virtually non-existent with SNAP, and the company has plenty of headroom and ability to raise debt should it need to in the future.Simply Wall St - – Full article
In this article I am going to calculate the intrinsic value of Snap Inc (NYSE:SNAP) by projecting its future cash flows and then discounting them to today's value. … 5-year cash flow forecast 2018 2019 2020 2021 2022 Levered FCF ($, Millions) $-808.13 $-545.05 $41.50 $705.35 $1,332.47 Source Analyst x11 Analyst x10 Analyst x7 Analyst x4 Analyst x3 Present Value Discounted @ 9.11% $-740.69 $-457.87 $31.95 $497.76 $861.85 Present Value of 5-year Cash Flow (PVCF)= $193 We now need to calculate the Terminal Value, which accounts for all the future cash flows after the five years. … Terminal Value (TV) = FCF2022 × (1 + g) ÷ (r – g) = $1,332 × (1 + 2.5%) ÷ (9.1% – 2.5%) = $20,578 Present Value of Terminal Value (PVTV) = TV / (1 + r)5 = $20,578 / ( 1 + 9.1%)5 = $13,310 The total value, or equity value, is then the sum of the present value of the cash flows, which in this case is $13,503.Simply Wall St - – Full article
In September 2017, Snap Inc (NYSE:SNAP) announced its latest earnings update, which confirmed that losses became smaller relative to the prrior year's level as a result of recent tailwinds Today I want to provide a brief commentary on how market analysts predict Snap's earnings growth outlook over the next couple of years and whether the future looks brighter. … Check out our latest analysis for Snap Analysts' outlook for the upcoming year seems pessimistic, with earnings becoming even more negative, arriving at $-1,950.2M in 2018. … This means that, we can presume Snap will grow its earnings by 51.33% every year for the next couple of years.Simply Wall St - – Full article
In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for SNAP in the longer term. … To understand the overall trajectory of SNAP's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope. … NYSE:SNAP Future Profit Dec 5th 17 From the current net income level of $-514.6M and the final forecast of $-909.5M by 2020, the annual rate of growth for SNAP’s earnings is 51.78%.Simply Wall St - – Full article
Earnings is a powerful indication of SNAP's ability to invest shareholders' funds and generate returns. … Typically I would look at market cap and earnings as a proxy for performance, however, SNAP's negative earnings reduces the effectiveness of this method. … Hopefully this article has given you insight on how shareholders should think about SNAP's governance policies such as CEO pay.Simply Wall St - – Full article
Tech analysts are forecasting for the entire software tech industry, a fairly unexciting growth rate of 6.11% in the upcoming year , and a strong near-term growth of 29.65% over the next couple of years. … NYSE:SNAP PE PEG Gauge Nov 2nd 17 Software tech companies are typically trading at a PE of 42x, above the broader US stock market PE of 22x. … If SNAP has been on your watchlist for a while, now may be the time to enter into the stock, if you like its growth prospects and are not highly concentrated in the tech industry.Simply Wall St - – Full article
Snap Inc. operates as a camera company in the United States and internationally. The company offers Snapchat, a camera application that helps people to communicate through short videos and images. It also provides Camera, a tool to personalize and add context to Snaps; Friends Page that allows to creating and watching stories, chatting with groups, making voice and video calls, and communicating through a range of contextual stickers and Bitmojis; and Discover that helps to surface the most interesting stories from publishers, creators, and the community, based on a user’s subscriptions and interests. In addition, the company offers Snap Map, which enables individuals to pinch on the camera screen for bringing a live map of their location, as well as showing nearby friends, popular stories, and a heatmap of recent Snaps posted to their story; Memories that allows users to choose to save the Snaps they create in a searchable personal collection, and users to create Snaps and stories from their saved Snaps and camera roll; and Spectacles, a hardware product that connects with Snapchat and capture video from a human perspective. The company was formerly known as Snapchat, Inc. and changed its name to Snap Inc. in September 2016. Snap Inc. was founded in 2010 and is headquartered in Venice, California.
63 Market Street,
|Exchange Symbol||Ticker Symbol||Security||Exchange||Country||Currency||Listed on|
|NYSE||SNAP||Class A Non-Voting Common Stock||New York Stock Exchange||US||USD||02. Mar 2017|
|LSE||0RNH||Class A Non-Voting Common Stock||London Stock Exchange||GB||USD||02. Mar 2017|
|SWX||SNAP||Class A Non-Voting Common Stock||SIX Swiss Exchange||CH||CHF||02. Mar 2017|
|Company Analysis updated:||2018/02/24|
|Last estimates confirmation:||2018/02/21|
|Last earnings update:||2017/12/31|
|Last annual earnings update:||2017/12/31|
All dates in UTC. All financial data provided by Standard & Poor’s Capital IQ.
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.