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Staples Inc (NAS:SPLS)
Intrinsic Value (FCF Projected)
$21.73 (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 Free 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, Staples Inc's FCF projected intrinsic value is $21.73. The stock price of Staples Inc is $16.26. Therefore, Staples Inc's Price to Intrinsic Value (FCF Projected) Ratio of today is 0.7.

SPLS' s 10-Year Price to Intrinsic Value (FCF Projected) Range
Min: 0.46   Max: 40.96
Current: 0.7

0.46
40.96

During the past 13 years, the highest Price to Intrinsic Value (FCF Projected) Ratio of Staples Inc was 40.96. The lowest was 0.46. And the median was 1.18.

SPLS's Price to Intrinsic Value (FCF Projected) is ranked higher than
77% of the 460 Companies
in the Global Specialty Retail industry.

( Industry Median: 1.10 vs. SPLS: 0.70 )

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 Free 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 Staples Inc's FCF(6 year avg) is calculate as

Staples Inc Quarterly Data

201301201304201307201310201401201404201407201410201501201504
total_freecashflow 178306-8344766311-117513-25240
201007201010201101201104201107201110201201201204201207201210
total_freecashflow -49664279148-107143419536561
200907200910201001201004
total_freecashflow 184828375144

Add all the Free Cash Flow together and divide 6 will get Staples Inc's FCF(6 year avg) = $1,024.27.

Staples Inc's FCF Projected Intrinsic Value for today is calculated as

Intrinsic Value=(Growth Multiple*Free Cash Flow(6 year avg)+Total Equity(Apr15)*0.8)/Shares Outstanding
=(9.52035159596*1024.2715+5328*0.8)/645.000
=21.73

* 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.

Staples Inc's Price to FCF Projected Intrinsic Value Ratio for today is calculated as

Price to FCF Projected Intrinsic Value=Share Price/FCF Projected Intrinsic Value
=16.26/21.7268601701
=0.75

* 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.

Staples Inc Annual Data

Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
iv_dcf_share 16.5018.6922.0024.0028.4026.7026.8424.9824.3522.12

Staples Inc Quarterly Data

Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15
iv_dcf_share 24.9824.6824.7224.8724.3524.7124.8923.9922.1221.73
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