OTCPK:STZHF - Post by User
Post by
geosan0on Oct 26, 2021 1:29pm
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Post# 34051092
Valuation
Valuation
I know I'm preaching to the choir but came across a Simply Wall St article highlighting the valuation of Stelco based on a DCF (Discounted Cash Flow) analysis. At the conclusion of this analysis, the author believes that the shares are trading at a 16% discount to the then $43 CDN price.
Hold on to your hats when I tell you the assumptions that were used in coming up with this valuation. Firstly it is important to remember that in Q2 (3 MONTHS ONLY) the company reported Adjusted EBITDA of $410m. All figures that follow are in CDN$:
Based on analyst estimates,
2022 FCF (Free Cash Flow) is projected at $760m for the entire year;
2023 is projected at $454m FOR THE ENTIRE YEAR;
2024 is expected at $308m FOR THE ENTIRE YEAR;
2025 is expected at $240m; and decreasing steadlly until it reaches $159m in 2031.
Guess these analysts are too young to remember inflation but not so young to extol $1m bitcoin prices. Bizarro world indeed.
GLTA