Discounted Cash Flow Calculation for OTCPK:RUMO.F 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.
OTCPK:RUMO.F 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
Rumo's earnings available for a low price, and how does
this compare to other companies in the same industry?
Rumo's earnings are expected to grow significantly at over 20% yearly.
Rumo's revenue is expected to grow by 11.8% 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.
Rumo'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
2/6, 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.
João Albertode Abreu
TENURE AS CEO
Mr. João Alberto Fernandez De Abreu has been Chief Executive Officer of Rumo Malha Norte S.A. since 2019. He has been Chief Executive Officer of Rumo S.A. since April 1, 2019. He has been Chief Operating Officer and Member of the Executive Officers Board at Raízen Energia S.A. since April 2016. Mr. De Abreu served as Bioenergy and Technology Officer for the Ethanol, Sugar and Bioenergy Businesses at Raízen Energia S.A. since 2012 and its Agroindustry Officer since 2015. He served as Chief Commercial Officer and Member of the Board at Petróleo Sabbá. He serves as Member of the Board at Iogen Energy. He holds Degree in Mechanical and Production Engineering from Pontifícia Universidade Católica do Rio de Janeiro (PUC/RJ); and Master’s degree in Business Administration from Fundação Dom Cabral. He is a member of the board of WX Energy and CTC - Centro de Tecnologia Canavieira. He worked for Shell group for 18 years, occupying several positions in retail in Brazil, England and Argentina.
Insufficient data for João Alberto to compare compensation growth.
Insufficient data for João Alberto to establish whether their remuneration is reasonable compared to companies of similar size in United States of America.
Management Team Tenure
Average tenure of the
management team in years:
The average tenure for the Rumo management team is over 5 years, this suggests they are a seasoned and experienced team.
João Alberto de Abreu
Chief Executive Officer
VP of Finance and Chief Financial & Investor Relations Officer
Vice President of Operations
Marcos da Costa
Chief Services & Technology Officer and VP of Services & Technology
Vice President of Human Resources
Rodrigo de Moura Campos
Financial & Investor Relations Officer
Chief Commercial Officer & VP of Agricultural Commodities
José Cezario de Barros Sobrinho
Chief Investor Relations Officer
Personnel & Institutional Relations Officer
Investor Relations Analyst
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the Rumo board of directors is less than 3 years, this suggests a new board.
Board of Directors
Rubens Ometto de Mello
Chairman of the Board of Directors
Chairman of Fiscal Council
Marcelo de Souza Portela
Who owns this company?
Recent Insider Trading
No 3 month individual insider trading information.
Rumo S.A., through its subsidiaries, provides rail transportation services. It operates in three segments: Northern Operations, South Operations, and Container Operations. The company offers logistics services primarily for export commodities, including integrated transport solution, handling, storage, and shipment from the production centers to the southern and southeast ports. It owns and operates a fleet of 27,748 railcars, 70 road-railers, 1,000 vehicles, and 966 locomotives. The company transports agricultural commodities, including fertilizers, corn, wheat, soybean, bran, vegetable oil, and sugar; and fuel, construction, steel, forestry, consumption, petrochemical, and container products. It is also involved in the terminal and storage operations; railcars unload, inventory management, and shipment operations; and installation of railcar re-cooling centers in Guarapuava and Curitiba, as well as the provision of refrigerated express train services and railway-based logistics solutions to handle refrigerated cargo. The company was formerly known as ALL – América Latina Logística S.A. Rumo S.A. was founded in 1997 and is headquartered in Curitiba, Brazil.
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