Tsogo Sun Valuation

Q: What is the Fair Price of TSG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

TSG (ZAR11.75) is trading below our estimate of [[fair value]] (ZAR14.85)

Is TSG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of TSG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TSG (ZAR11.75) is trading below our estimate of fair value (ZAR14.85)

Significantly Below Fair Value: TSG is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TSG?

Key metric: As TSG is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for TSG. This is calculated by dividing TSG's market cap by their current earnings.
What is TSG's PE Ratio?
PE Ratio	8x
Earnings	R1.53b
Market Cap	R12.21b

TSG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.7x
Enterprise Value/EBITDA	5.3x
PEG Ratio	0.8x

Price to Earnings Ratio vs Peers

How does TSG's PE Ratio compare to its peers?

The above table shows the PE ratio for TSG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	13.7x
SUI Sun International	10.8x	20.3%	R10.8b
SSU Southern Sun	12.8x	19.1%	R12.0b
FBR Famous Brands	14.1x	n/a	R6.8b
ADH ADvTECH	17x	12.2%	R17.4b
TSG Tsogo Sun	8x	10.3%	R12.2b

Price-To-Earnings vs Peers: TSG is good value based on its Price-To-Earnings Ratio (8x) compared to the peer average (13.7x).

Price to Earnings Ratio vs Industry

How does TSG's PE Ratio compare vs other companies in the African Hospitality Industry?

0 Companies	Price / Earnings	Estimated Growth	Market Cap

0 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: TSG is good value based on its Price-To-Earnings Ratio (8x) compared to the African Hospitality industry average (11.4x).

Price to Earnings Ratio vs Fair Ratio

What is TSG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TSG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	8x
Fair PE Ratio	11x

Price-To-Earnings vs Fair Ratio: TSG is good value based on its Price-To-Earnings Ratio (8x) compared to the estimated Fair Price-To-Earnings Ratio (11x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.