MATW Intrinsic Value

MATW

Matthews International Corp. – Funeral Homes and Funeral Services

matthews international corporation has become a leader in the industries we serve by adhering to our belief that continuous quality improvement is paramount in every aspect of our business. in 2016, matthews achieved more than $1.4 billion in sales. today, the company is divided into three distinct business segments: brand solutions, memorialization and industrial. it boasts more than 10,000 employees on six continents in more than 100 locations. matthews brand solutions services consumer products by managing brand standards across all packaging components. most recently, matthews acquired sgk, a leading brand development, activation and deployment company that drives brand performance across 20+ countries. matthews has been a leader in the memorialization industry for more than a century and a half. we serve cemeteries and funeral homes with a full range of products and services. like all other businesses, our memorialization workforce takes great pride servicing our customers with un

Analysis Results

Intrinsic Value	$53.34
Latest Price	$39.95
Relative Value	25% undervalued

Share results:

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Cash Flow (Millions)

Analysis Parameters

New Ticker

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 -3.1%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.0%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of -3.1%, 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	82.1	77.5
2024	79.6	70.8
2025	77.1	64.7
2026	74.7	59.2
2027	72.4	54.1

Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 1840 million. This corresponds to a present value of 1300 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 326 million. Adding in the terminal value gives a total present value of 1630 million.

There are presently 30.5 million outstanding shares, so the intrinsic value per share is 53.34.

Financial Statements

The following data was to determine the past cash flows.

Current Assets	628,616,000
Current Cash	69,016,000
Current Liabilities	411,375,000
Current Debt	3,277,000
Non-Cash Working Capital (NCWC)	151,502,000
Change in NCWC	-73,886,000
EBIT	38,517,000
Tax Provision	-4,391,000
Depreciation and Amortization	104,056,000
Capital Expenditure	-61,321,000
Unlevered Free Cash Flow	7,366,000

Current Assets	624,165,000
Current Cash	49,176,000
Current Liabilities	354,225,000
Current Debt	4,624,000
Non-Cash Working Capital (NCWC)	225,388,000
Change in NCWC	-18,807,000
EBIT	42,034,000
Tax Provision	6,375,000
Depreciation and Amortization	133,512,000
Capital Expenditure	-34,313,000
Unlevered Free Cash Flow	93,403,282

Current Assets	575,573,000
Current Cash	41,334,000
Current Liabilities	316,868,000
Current Debt	26,824,000
Non-Cash Working Capital (NCWC)	244,195,000
Change in NCWC	-66,843,000
EBIT	26,215,000
Tax Provision	-18,685,000
Depreciation and Amortization	119,058,000
Capital Expenditure	-34,849,000
Unlevered Free Cash Flow	43,581,000

Current Assets	583,716,000
Current Cash	35,302,000
Current Liabilities	279,879,000
Current Debt	42,503,000
Non-Cash Working Capital (NCWC)	311,038,000
Change in NCWC	9,070,000
EBIT	85,825,000
Tax Provision	806,000
Depreciation and Amortization	90,793,000
Capital Expenditure	-37,688,000
Unlevered Free Cash Flow	148,000,000

Current Assets	616,423,000
Current Cash	41,572,000
Current Liabilities	304,143,000
Current Debt	31,260,000
Non-Cash Working Capital (NCWC)	301,968,000
Change in NCWC	20,028,000
EBIT	132,834,000
Tax Provision	-9,118,000
Depreciation and Amortization	76,974,000
Capital Expenditure	-43,200,000
Unlevered Free Cash Flow	186,636,000

Current Assets	595,059,000
Current Cash	57,515,000
Current Liabilities	285,132,000
Current Debt	29,528,000
Non-Cash Working Capital (NCWC)	281,940,000
Change in NCWC	-4,932,000
EBIT	112,603,000
Tax Provision	22,354,000
Depreciation and Amortization	67,981,000
Capital Expenditure	-44,935,000
Unlevered Free Cash Flow	104,575,075

Current Assets	574,184,000
Current Cash	55,711,000
Current Liabilities	259,348,000
Current Debt	27,747,000
Non-Cash Working Capital (NCWC)	286,872,000
Change in NCWC	-28,240,000
EBIT	118,815,000
Tax Provision	29,073,000
Depreciation and Amortization	65,480,000
Capital Expenditure	-41,682,000
Unlevered Free Cash Flow	78,101,201

Current Assets	624,654,000
Current Cash	72,196,000
Current Liabilities	249,083,000
Current Debt	11,737,000
Non-Cash Working Capital (NCWC)	315,112,000
Change in NCWC	49,942,000
EBIT	105,023,000
Tax Provision	26,364,000
Depreciation and Amortization	62,620,000
Capital Expenditure	-48,251,000
Unlevered Free Cash Flow	138,449,843

Current Assets	566,228,000
Current Cash	63,003,000
Current Liabilities	253,283,000
Current Debt	15,228,000
Non-Cash Working Capital (NCWC)	265,170,000
Change in NCWC	78,566,000
EBIT	81,522,000
Tax Provision	22,805,000
Depreciation and Amortization	42,864,000
Capital Expenditure	-29,237,000
Unlevered Free Cash Flow	145,579,077

Current Assets	405,982,000
Current Cash	57,986,000
Current Liabilities	184,006,000
Current Debt	22,614,000
Non-Cash Working Capital (NCWC)	186,604,000
Change in NCWC	18,945,000
EBIT	95,792,000
Tax Provision	26,664,000
Depreciation and Amortization	37,865,000
Capital Expenditure	-24,924,000
Unlevered Free Cash Flow	96,313,518

Current Assets	385,225,000
Current Cash	58,259,000
Current Liabilities	180,873,000
Current Debt	21,566,000
Non-Cash Working Capital (NCWC)	167,659,000
Change in NCWC	3,202,000
EBIT	93,577,000
Tax Provision	28,717,000
Depreciation and Amortization	28,821,000
Capital Expenditure	-33,236,000
Unlevered Free Cash Flow	60,342,804

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