DCF Tool

DSWL

Deswell Industries, Inc. – Electronic Computer Manufacturing
Deswell manufactures injection-molded plastic parts and components, electronic products and subassemblies, and metallic products for original equipment manufacturers ("OEMs") and contract manufacturers. The Company produces a wide variety of plastic parts and components used in the manufacture of consumer and industrial products; printed circuit board assemblies using surface mount ("SMT") and finished products.
Analysis Results
Intrinsic Value $98.16
Latest Price $3.13
Relative Value 97% undervalued
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Cash Flow (Millions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 40.2%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.6%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 40.2%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (million) Present value (million)
2023 15.1 14.6
2024 21.2 19.7
2025 29.7 26.7
2026 41.7 36.2
2027 58.4 49.0
Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 1750 million. This corresponds to a present value of 1420 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 146 million. Adding in the terminal value gives a total present value of 1560 million.

There are presently 15.9 million outstanding shares, so the intrinsic value per share is 98.16.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 87,822,000
Current Cash 43,882,000
Current Liabilities 23,974,000
Current Debt 0
Non-Cash Working Capital (NCWC) 19,966,000
Change in NCWC 7,790,000
EBIT 2,685,000
Tax Provision -165,000
Depreciation and Amortization 1,736,000
Capital Expenditure -1,504,000
Unlevered Free Cash Flow 10,707,000
Current Assets 78,686,000
Current Cash 45,296,000
Current Liabilities 21,214,000
Current Debt 0
Non-Cash Working Capital (NCWC) 12,176,000
Change in NCWC 3,851,000
EBIT 2,856,000
Tax Provision 475,000
Depreciation and Amortization 1,755,000
Capital Expenditure -551,000
Unlevered Free Cash Flow 7,755,176
Current Assets 65,369,000
Current Cash 42,738,000
Current Liabilities 14,306,000
Current Debt 0
Non-Cash Working Capital (NCWC) 8,325,000
Change in NCWC -6,899,000
EBIT 1,541,000
Tax Provision 373,000
Depreciation and Amortization 1,973,000
Capital Expenditure -507,000
Unlevered Free Cash Flow -3,892,000
Current Assets 69,958,000
Current Cash 39,188,000
Current Liabilities 15,546,000
Current Debt 0
Non-Cash Working Capital (NCWC) 15,224,000
Change in NCWC 2,457,000
EBIT 408,000
Tax Provision 144,000
Depreciation and Amortization 2,114,000
Capital Expenditure -878,000
Unlevered Free Cash Flow 4,087,698
Current Assets 68,905,000
Current Cash 37,793,000
Current Liabilities 18,345,000
Current Debt 0
Non-Cash Working Capital (NCWC) 12,767,000
Change in NCWC 1,287,000
EBIT 1,582,000
Tax Provision 7,000
Depreciation and Amortization 2,138,000
Capital Expenditure -1,707,000
Unlevered Free Cash Flow 3,298,213
Current Assets 56,093,000
Current Cash 29,827,000
Current Liabilities 14,786,000
Current Debt 0
Non-Cash Working Capital (NCWC) 11,480,000
Change in NCWC 2,485,000
EBIT -1,778,000
Tax Provision 209,000
Depreciation and Amortization 2,135,000
Capital Expenditure -2,152,000
Unlevered Free Cash Flow 924,449
Current Assets 50,653,000
Current Cash 30,895,000
Current Liabilities 10,763,000
Current Debt 0
Non-Cash Working Capital (NCWC) 8,995,000
Change in NCWC -1,154,000
EBIT -4,600,000
Tax Provision 158,000
Depreciation and Amortization 2,373,000
Capital Expenditure -591,000
Unlevered Free Cash Flow -3,972,000
Current Assets 58,240,000
Current Cash 35,715,000
Current Liabilities 12,376,000
Current Debt 0
Non-Cash Working Capital (NCWC) 10,149,000
Change in NCWC 763,000
EBIT -4,972,000
Tax Provision 207,000
Depreciation and Amortization 2,824,000
Capital Expenditure -890,000
Unlevered Free Cash Flow -2,275,000
Current Assets 61,894,000
Current Cash 41,482,000
Current Liabilities 11,026,000
Current Debt 0
Non-Cash Working Capital (NCWC) 9,386,000
Change in NCWC -444,000
EBIT -7,183,000
Tax Provision 624,000
Depreciation and Amortization 3,621,000
Capital Expenditure -853,000
Unlevered Free Cash Flow -4,859,000

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