Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Calamos Asset Management's forward rate of return for was 25.22%.
The historical rank and industry rank for Calamos Asset Management's Forward Rate of Return (Yacktman) % or its related term are showing as below:
CLMS's Forward Rate of Return (Yacktman) % is not ranked *
in the Asset Management industry.
Industry Median: 5.67 * Ranked among companies with meaningful Forward Rate of Return (Yacktman) % only.
Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Calamos Asset Management Forward Rate of Return (Yacktman) % Historical Data
The historical data trend for Calamos Asset Management's Forward Rate of Return (Yacktman) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Asset Management subindustry, Calamos Asset Management's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Calamos Asset Management Forward Rate of Return (Yacktman) % Distribution
For the Asset Management industry and Financial Services sector, Calamos Asset Management's Forward Rate of Return (Yacktman) % distribution charts can be found below:
* The bar in red indicates where Calamos Asset Management's Forward Rate of Return (Yacktman) % falls into.
Calamos Asset Management Forward Rate of Return (Yacktman) % Calculation
Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
Calamos Asset Management's Forward Rate of Return of Sep. 2016 is
Forward Rate of Return
=
Normalized Free Cash Flow
/
Price
+
5-Year EBITDA Growth Rate
=
4.29257143
/
6.82
+
-0.3772
=
25.22 %
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.
Be Aware
In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.
Calamos Asset Management Forward Rate of Return (Yacktman) % Related Terms
Thank you for viewing the detailed overview of Calamos Asset Management's Forward Rate of Return (Yacktman) % provided by GuruFocus.com. Please click on the following links to see related term pages.
Calamos Asset Management (Calamos Asset Management) Business Description
Calamos Asset Management Inc is a Delaware corporation, incorporated on July 23, 2004. It is an asset management firm that offers strategies to fulfill a range of asset allocation goals through a multi-team platform. The Company together with its subsidiaries provides investment advisory services to individuals and institutional investors through open-end funds, closed-end funds, separate accounts, offshore funds and partnerships. The company applies an investment philosophy and proprietary process centered on risk management across a range of investment strategies, including equity, balanced, convertible, high yield, alternative, fixed income and money market investments. The Company currently offers four types of investment products that fall into the categories of mutual funds and separate accounts. Funds include its open-end and closed-end funds as well as its Offshore Funds. The Company includes the Offshore Funds in open-end funds for reporting purposes. Separate accounts are individual portfolios of securities managed to meet clients specific needs and include institutional accounts and managed accounts. The Company competes in all aspects of its business with a large number of investment management firms, commercial banks, broker-dealers and insurance companies. In the United States and other countries in which it does business, it is subject to regulations and laws at both a federal and state level, including U.S. federal, state and local tax laws as well as similar foreign jurisdiction tax laws.
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