DCF Tool

IIVI

Ii-Vi Inc. – Optical Instrument and Lens Manufacturing
II-VI Incorporated, a global leader in engineered materials and optoelectronic components, is a vertically integrated manufacturing company that develops innovative products for diversified applications in communications, materials processing, aerospace & defense, semiconductor capital equipment, life sciences, consumer electronics, and automotive markets. Headquartered in Saxonburg, Pennsylvania, U.S.A., the Company has research and development, manufacturing, sales, service, and distribution facilities worldwide. The Company produces a wide variety of application-specific photonic and electronic materials and components, and deploys them in various forms, including integrated with advanced software to support its customers.
Analysis Results
Intrinsic Value $152.58
Latest Price $43.26
Relative Value 72% undervalued
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Cash Flow (Billions)
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 33.4%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 9.1%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 33.4%, 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 (billion) Present value (billion)
2023 0.588 0.539
2024 0.784 0.659
2025 1.05 0.805
2026 1.39 0.984
2027 1.86 1.2
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 26.6 billion. This corresponds to a present value of 15.8 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 4.19 billion. Adding in the terminal value gives a total present value of 20.0 billion.

There are presently 131.0 million outstanding shares, so the intrinsic value per share is 152.58.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 4,305,192,000
Current Cash 2,582,371,000
Current Liabilities 1,266,959,000
Current Debt 403,212,000
Non-Cash Working Capital (NCWC) 859,074,000
Change in NCWC 91,111,000
EBIT 414,294,000
Tax Provision 47,048,000
Depreciation and Amortization 286,779,000
Capital Expenditure -314,332,000
Unlevered Free Cash Flow 408,685,144
Current Assets 3,027,394,000
Current Cash 1,591,892,000
Current Liabilities 729,589,000
Current Debt 62,050,000
Non-Cash Working Capital (NCWC) 767,963,000
Change in NCWC 75,683,000
EBIT 402,119,000
Tax Provision 55,038,000
Depreciation and Amortization 270,069,000
Capital Expenditure -146,337,000
Unlevered Free Cash Flow 538,764,705
Current Assets 1,788,969,000
Current Cash 493,046,000
Current Liabilities 672,893,000
Current Debt 69,250,000
Non-Cash Working Capital (NCWC) 692,280,000
Change in NCWC 330,970,000
EBIT 39,479,000
Tax Provision 3,101,000
Depreciation and Amortization 220,882,000
Capital Expenditure -136,877,000
Unlevered Free Cash Flow 454,454,000
Current Assets 812,911,000
Current Cash 204,872,000
Current Liabilities 270,563,000
Current Debt 23,834,000
Non-Cash Working Capital (NCWC) 361,310,000
Change in NCWC 62,978,000
EBIT 149,968,000
Tax Provision 21,296,000
Depreciation and Amortization 92,365,000
Capital Expenditure -137,122,000
Unlevered Free Cash Flow 143,395,551
Current Assets 761,837,000
Current Cash 247,038,000
Current Liabilities 236,467,000
Current Debt 20,000,000
Non-Cash Working Capital (NCWC) 298,332,000
Change in NCWC 32,876,000
EBIT 138,887,000
Tax Provision 34,192,000
Depreciation and Amortization 80,770,000
Capital Expenditure -153,438,000
Unlevered Free Cash Flow 60,232,009
Current Assets 702,296,000
Current Cash 271,888,000
Current Liabilities 184,952,000
Current Debt 20,000,000
Non-Cash Working Capital (NCWC) 265,456,000
Change in NCWC 52,180,000
EBIT 116,241,000
Tax Provision 23,514,000
Depreciation and Amortization 63,637,000
Capital Expenditure -138,517,000
Unlevered Free Cash Flow 70,531,176
Current Assets 582,963,000
Current Cash 218,445,000
Current Liabilities 171,242,000
Current Debt 20,000,000
Non-Cash Working Capital (NCWC) 213,276,000
Change in NCWC -6,902,000
EBIT 91,813,000
Tax Provision 24,469,000
Depreciation and Amortization 56,663,000
Capital Expenditure -58,170,000
Unlevered Free Cash Flow 58,429,598
Current Assets 512,968,000
Current Cash 173,634,000
Current Liabilities 139,156,000
Current Debt 20,000,000
Non-Cash Working Capital (NCWC) 220,178,000
Change in NCWC 4,172,000
EBIT 77,699,000
Tax Provision 13,137,000
Depreciation and Amortization 53,083,000
Capital Expenditure -52,313,000
Unlevered Free Cash Flow 69,738,636
Current Assets 505,731,000
Current Cash 174,660,000
Current Liabilities 135,065,000
Current Debt 20,000,000
Non-Cash Working Capital (NCWC) 216,006,000
Change in NCWC 34,729,000
EBIT 46,486,000
Tax Provision 7,325,000
Depreciation and Amortization 53,098,000
Capital Expenditure -29,220,000
Unlevered Free Cash Flow 97,632,384
Current Assets 461,144,000
Current Cash 185,433,000
Current Liabilities 94,434,000
Current Debt 0
Non-Cash Working Capital (NCWC) 181,277,000
Change in NCWC -10,424,000
EBIT 64,702,000
Tax Provision 18,766,000
Depreciation and Amortization 40,929,000
Capital Expenditure -25,273,000
Unlevered Free Cash Flow 52,759,328
Current Assets 410,373,000
Current Cash 134,944,000
Current Liabilities 83,728,000
Current Debt 0
Non-Cash Working Capital (NCWC) 191,701,000
Change in NCWC 32,859,000
EBIT 71,939,000
Tax Provision 17,620,000
Depreciation and Amortization 34,693,000
Capital Expenditure -42,840,000
Unlevered Free Cash Flow 80,584,516

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