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MSN

Emerson Radio Corp. – Audio and Video Equipment Manufacturing
Emerson Radio Corp., founded in 1948, is one of the nations oldest consumer electronics distributors with a recognized trademark in continuous use since 1912. It continues to be one of the most well-respected names in the consumer electronics industry. Today the Emerson Company is known to produce quality and innovative devices. The Company engages in the design and marketing of audio and home appliance products tailored to meet consumer preferences. The company's top selling Smart Set Clock Radio has sold over 15 million units to date. Other products offered includes microwaves, toaster ovens, wine coolers, wine openers, clock radios and more. Emerson Radio Corp.’s long history of reliability makes us the consumer’s trusted guide in this new and constantly changing world of consumer electronics. The company's continued customer commitment is expressed through our total accountability for satisfying our customer’s electronic needs.
Analysis Results
Intrinsic Value $0.04
Latest Price $0.70
Relative Value 1678% overvalued
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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 -36.6%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 8.1%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of -36.6%, 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)
2022 0.218 0.201
2023 0.138 0.118
2024 0.0876 0.0694
2025 0.0556 0.0407
2026 0.0353 0.0239
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 0.592 million. This corresponds to a present value of 0.371 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 0.454 million. Adding in the terminal value gives a total present value of 0.825 million.

There are presently 21.0 million outstanding shares, so the intrinsic value per share is 0.04.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 33,592,000
Current Cash 30,290,000
Current Liabilities 1,536,000
Current Debt 205,000
Non-Cash Working Capital (NCWC) 1,971,000
Change in NCWC 200,000
EBIT -4,195,000
Tax Provision 15,000
Depreciation and Amortization 233,000
Capital Expenditure 0
Unlevered Free Cash Flow -3,762,000
Current Assets 37,356,000
Current Cash 34,377,000
Current Liabilities 1,209,000
Current Debt 1,000
Non-Cash Working Capital (NCWC) 1,771,000
Change in NCWC -2,234,000
EBIT -4,626,000
Tax Provision 457,000
Depreciation and Amortization 35,000
Capital Expenditure 0
Unlevered Free Cash Flow -6,825,000
Current Assets 41,253,000
Current Cash 36,288,000
Current Liabilities 960,000
Current Debt 0
Non-Cash Working Capital (NCWC) 4,005,000
Change in NCWC -860,000
EBIT -3,648,000
Tax Provision -352,000
Depreciation and Amortization 5,000
Capital Expenditure 0
Unlevered Free Cash Flow -4,503,000
Current Assets 47,064,000
Current Cash 41,096,000
Current Liabilities 1,103,000
Current Debt 0
Non-Cash Working Capital (NCWC) 4,865,000
Change in NCWC 1,397,000
EBIT -3,882,000
Tax Provision 3,461,000
Depreciation and Amortization 8,000
Capital Expenditure -4,000
Unlevered Free Cash Flow -2,481,000
Current Assets 56,938,000
Current Cash 52,549,000
Current Liabilities 921,000
Current Debt 0
Non-Cash Working Capital (NCWC) 3,468,000
Change in NCWC -1,949,000
EBIT -326,000
Tax Provision 172,000
Depreciation and Amortization 16,000
Capital Expenditure -5,000
Unlevered Free Cash Flow -2,264,000
Current Assets 58,326,000
Current Cash 50,251,000
Current Liabilities 2,658,000
Current Debt 0
Non-Cash Working Capital (NCWC) 5,417,000
Change in NCWC -8,540,000
EBIT -1,405,000
Tax Provision -259,000
Depreciation and Amortization 48,000
Capital Expenditure 0
Unlevered Free Cash Flow -9,897,000
Current Assets 60,926,000
Current Cash 43,485,000
Current Liabilities 3,484,000
Current Debt 0
Non-Cash Working Capital (NCWC) 13,957,000
Change in NCWC -794,000
EBIT 4,745,000
Tax Provision 3,067,000
Depreciation and Amortization 75,000
Capital Expenditure -10,000
Unlevered Free Cash Flow 1,081,944
Current Assets 77,224,000
Current Cash 58,522,000
Current Liabilities 3,951,000
Current Debt 0
Non-Cash Working Capital (NCWC) 14,751,000
Change in NCWC 8,852,000
EBIT 3,519,000
Tax Provision -1,469,000
Depreciation and Amortization 88,000
Capital Expenditure -28,000
Unlevered Free Cash Flow 12,431,000
Current Assets 82,582,000
Current Cash 66,647,000
Current Liabilities 10,079,000
Current Debt 43,000
Non-Cash Working Capital (NCWC) 5,899,000
Change in NCWC -13,619,000
EBIT 10,651,000
Tax Provision 3,666,000
Depreciation and Amortization 106,000
Capital Expenditure -111,000
Unlevered Free Cash Flow -7,012,996
Current Assets 74,949,000
Current Cash 44,960,000
Current Liabilities 10,535,000
Current Debt 64,000
Non-Cash Working Capital (NCWC) 19,518,000
Change in NCWC 10,352,000
EBIT 11,865,000
Tax Provision 2,476,000
Depreciation and Amortization 276,000
Capital Expenditure -57,000
Unlevered Free Cash Flow 20,195,135

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