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Magellan Midstream Partners LP (NYSE:MMP)
Peter Lynch Fair Value
$64.72 (As of Today)

Peter Lynch Fair Value applies to growing companies. The ideal range for the growth rate is between 10 - 20% a year. Peter Lynch thinks that the fair P/E value for a growth company equals its growth rate, that is PEG = 1. The earnings here is trailing twelve month (TTM) earnings. The growth rate we use is the average growth rate for earnings per share over the past 5 years. If 5-Year Earnings Growth Rate is greater than 25% a year, we use 25. If 5-Year Earnings Growth Rate is smaller than 5% a year, we do not calculate Peter Lynch Fair Value.

Here, as of today, Magellan Midstream Partners LP's PEG is 1. Magellan Midstream Partners LP's 5-Year EBITDA Growth Rate is 17.35. Magellan Midstream Partners LP's Earnings Per Share without Non-Recurring Items (NRI) for the trailing twelve months (TTM) ended in Jun. 2016 was $3.73. Therefore, the Peter Lynch Fair Value for today is $64.72.

As of today, Magellan Midstream Partners LP's share price is $70.17. Magellan Midstream Partners LP's Peter Lynch fair value is $64.72. Therefore, Magellan Midstream Partners LP's Price to Peter Lynch Fair Value Ratio for today is 1.08.

MMP' s Price to Peter Lynch Fair Value Range Over the Past 10 Years
Min: 0.58   Max: 4.93
Current: 1.08

0.58
4.93

During the past 13 years, the highest Price to Peter Lynch Fair Value Ratio of Magellan Midstream Partners LP was 4.93. The lowest was 0.58. And the median was 1.64.

MMP's Price to Peter Lynch Fair Value is ranked higher than
65% of the 17 Companies
in the Global Oil & Gas Midstream industry.

( Industry Median: 1.18 vs. MMP: 1.08 )

Note: Please don't confuse Peter Lynch Fair Value with the value reached in Peter Lynch Chart.


Definition

Magellan Midstream Partners LP's Peter Lynch Fair Value for today is calculated as

Peter Lynch Fair Value=PEG*5-Year EBITDA Growth Rate*Earnings Per Share (NRI) (TTM)
=1*17.35*3.73
=64.72

Magellan Midstream Partners LP's Earnings Per Share (NRI) for the trailing twelve months (TTM) ended in Jun. 2016 was 1.1 (Sep. 2015 ) + 0.9 (Dec. 2015 ) + 0.91 (Mar. 2016 ) + 0.82 (Jun. 2016 ) = $3.73.

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

If 5-Year Earnings Growth Rate is greater than 25% a year, we use 25.

If 5-Year Earnings Growth Rate is smaller than 5% a year, we do not calculate Peter Lynch Fair Value.

Please note that we use the 5-year average growth rate of EBITDA per share as the growth rate. EBITDA growth is subject to less manipulations than net earnings per share. In the calculation, PEG=1 because Peter Lynch thinks that the fair P/E ratio of the growth stock is equal to its earnings growth rate.


Explanation

Peter Lynch Fair Value applies to growing companies. The ideal range for the growth rate is between 10 - 20% a year.

Peter Lynch thinks that the fair P/E value for a growth company equals its growth rate, that is PEG = 1. The earnings here is trailing twelve month (TTM) earnings. The growth rate we use is the average growth rate for earnings per share over the past 5 years.

Please don't confuse Peter Lynch Fair Value with the value reached in Peter Lynch Chart. In Peter Lynch chart, a fixed P/E ratio of 15 is used to draw the Earnings Line. Therefore the value reached has a P/E ratio of 15. But in Peter Lynch Fair Value calculation, P/E equals to the growth rate of EBITDA over the past 5 years, which is 17.35 instead of 15 in this case.

Magellan Midstream Partners LP's Price to Peter Lynch Fair Value Ratio for today is calculated as

Price to Peter Lynch Fair Value=Share Price/Peter Lynch Fair Value
=70.17/64.72
=1.08

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


Related Terms

Earnings Per Share (NRI), peg, Median P/S Value, Intrinsic Value (DCF Projected), Intrinsic Value (DCF), Intrinsic Value (DE), Graham Number


Historical Data

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

Magellan Midstream Partners LP Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
lynchvalue 12.5623.575.955.7117.0914.37N/AN/A24.9964.91

Magellan Midstream Partners LP Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
lynchvalue N/AN/A17.0824.9933.2444.8259.6564.9165.4664.72
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