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How does this work?
A valuation is an assessment of the value of one share in a company, it is not necessarily the same as the price listed in the sharemarket. You can use a variety of methods to value a company, Valuecruncher uses Discounted Cash Flow (DCF) analysis to help people create the valuations you see below.
Valuecruncher Valuation
6.32%
from latest share price
Your Valuation
| Valuation | Compared to price | Member |
 Created
|
Views |
|---|---|---|---|---|
| $6.06 |
6.32%
|
Valuecruncher | 23 Nov 2008 | 0 |
| $6.77 |
14.75%
|
NZXCrunchBlog | 17 Oct 2008 | 29 |
| $6.41 |
 -0.47%
|
KiwiEMH | 02 Oct 2008 | 21 |
| $6.41 |
-0.62%
|
KiwiEMH | 24 Sep 2008 | 23 |
| $7.58 |
-1.81%
|
KiwiEMH | 04 Aug 2008 | 30 |
| $6.40 |
-23.35%
|
andrew | 25 May 2008 | 43 |
| $6.99 |
-14.96%
|
tiger | 23 May 2008 | 52 |
| $7.37 |
-10.34%
|
Sam | 16 May 2008 | 41 |
| $8.36 |
3.72%
|
GordonGekko | 15 May 2008 | 45 |
| $7.86 |
-0.51%
|
KiwiEMH | 07 May 2008 | 63 |
| $6.83 |
-15.26%
|
Sam | 23 Apr 2008 | 41 |
Recent Comments
| Updated: | 4 hours ago |
| Ticker: | NZX |
| Market: | NZE |
This valuation is part of this blog post:
http://blog.valuecruncher.com/2008/10/running-the-numbers-–nzx-limited-nzxnz/
Assumptions
In 2007 (31 December balance date) NZX.NZ had revenues of NZ$31.5 million and an EBITD margin (profits) of 49.9%. Reuters aggregates three analysts covering NZX.NZ and these have mean estimates of 2008 and 2009 revenues of NZ$32.5 and NZ$36.1 million respectively. For this analysis we have used revenues of NZ$32.5 million in 2008, NZ$36.0 million in 2009 and NZ$39.0 million in 2010. We have forecast EBITDA margins flat at 48.0% to 2010. We have estimated capital expenditure of NZ$4.0 billion in 2008 and then NZ$3.0 million moving forward. All of these assumptions can be amended in the Valuecruncher on-line valuation model to adjust the valuation.
Other Model Assumptions:
Discount Rate: 9.5%. PwC in their New Zealand cost of capital report calculates NZX.NZ WACC at 9.6%.
Terminal Growth Rate: 4.25%. The New Zealand economy has grown at an average rate of 2.6% over the last five-years. We see NZX.NZ growing more quickly than the New Zealand economy moving forward due to the growth options available to the company – primarily around data.
Our analysis incorporates the cash and debt on the NZX.NZ balance sheet – Valuecruncher calculates a net debt number.
I think your discount rate is too high. The NZX cash flows are reasonably stable. I think the discount rate looks more like 10-11%.
I also think that your long-term growth is too high. NZ has a long-run economy growth rate (GDP) of around 3-3.5%. Can NZX grow that much faster than the wider economy? Not without some large listings (i.e. Fonterra) or finding material alternative revenue streams. Data has driven the recent growth - how much more can they find? I believe that terminal growth looks more like 3.5-4% (maybe 4.5% if you really believe the growth story).
WACC at 10.5% - PWC lists it at 10.9%. LTG at 4% - just above the long-run NZ economy 3.5%. There is some room for additional growth with the Australian expansion plans and additional NZ listings in future. That said it doesn't look like Fonterra just yet. EBITDA margins edging up toward 50% - it is a good business. Terminal CAPEX at $2 million - I view the additional growth requiring investment to achieve.
WACC at 10%. Long-term growth at 3.5% (long-run NZ GDP forecast). I have EBITDA margins topping out at around 48% - just below 50%. Revenue growth as forecast.