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Apache Corporation (NYSE:APA)
Intrinsic Value (DCF Projected)
$45.57 (As of Today)

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value (DCF), or Discounted Earnings (DCE) Intrinsic Value (DE) cannot be applied to companies without consistent revenue and earnings, GuruFocus developed a valuation model based on normalized Discounted Cash Flow and Book Value of the company. The details of how we calculate the intrinsic value of stocks are described in detail here.

As of today, Apache Corporation's DCF projected intrinsic value is $45.57. The stock price of Apache Corporation is $100.32. Therefore, Apache Corporation's Price to Intrinsic Value (DCF Projected) Ratio of today is 2.2.

APA' s 10-Year Price to Intrinsic Value (DCF Projected) Range
Min: 0.98   Max: 7.01
Current: 2.2

0.98
7.01

During the past 13 years, the highest Price to Intrinsic Value (DCF Projected) Ratio of Apache Corporation was 7.01. The lowest was 0.98. And the median was 1.40.

APA's Price to Intrinsic Value (DCF Projected) is ranked higher than
95% of the 1131 Companies
in the Global Oil & Gas E&P industry.

( Industry Median: 9999.00 vs. APA: 2.20 )

Definition

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value (DCF), or Discounted Earnings (DCE) Intrinsic Value (DE) cannot be applied to companies without consistent revenue and earnings, GuruFocus developed a valuation model based on normalized Discounted Cash Flow and Book Value of the company.

The details of how we calculate the intrinsic value of stocks are described in detail here.

This method smooths out the free cash flow over the past 6-7 years, multiplies the results by a growth multiple, and adds a portion of total equity.

Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + 0.8*Total Equity(most recent))/Shares Outstanding

In the case of negative total equity, the following formula is used (see the Total Equity section for the reason):

Value = ((Growth Multiple)*Free Cash Flow(6 year avg) + Total Equity(most recent)/0.8)/Shares Outstanding


Here Apache Corporation's FCF(6 year avg) is calculate as

Apache Corporation Quarterly Data

201112201203201206201209201212201303201306201309201312201403
total_freecashflow 93440561-1,152-476-144-109-746-386-413
200906200909200912201003201006201009201012201103201106201109
total_freecashflow -58173495580827524-7,0742831,002656
200806200809200812200903
total_freecashflow 387596-302-516

Add all the Free Cash Flow together and divide 6 will get Apache Corporation's FCF(6 year avg) = $-720.11.

Apache Corporation's DCF Projected Intrinsic Value for today is calculated as

Intrinsic Value=(Growth Multiple*Free Cash Flow(6 year avg)+Total Equity(Mar14)*0.8)/Shares Outstanding
=(11.6932312435*-720.105833333+33082*0.8)/396.000
=45.57

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

The growth multiple is capped between 8.35 and 17.74.

Total equity weighting is more art than science and it should always be revisited in more detail when researching a company. Weightings from 0% to 100% to more than 100% are possible. 80% was chosen as a happy medium after taking the above ideas into consideration. Learn more here.

Apache Corporation's Price to DCF Projected Intrinsic Value Ratio for today is calculated as

Price to DCF Projected Intrinsic Value=Share Price/DCF Projected Intrinsic Value
=100.32/45.5687777046
=2.20

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

Intrinsic Value (DE), Intrinsic Value (DCF), Free Cash Flow


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Apache Corporation Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
iv_dcf_share 43.2553.0757.1865.5473.7067.2939.9058.5758.0250.55

Apache Corporation Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
iv_dcf_share 58.5761.4464.8657.5558.0257.6057.6155.1350.5545.57
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