Johnson Outdoors (Johnson Outdoors) Intrinsic Value: DCF (Earnings Based)

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For the Leisure subindustry, Johnson Outdoors's Price-to-DCF (Earnings Based), along with its competitors' market caps and Price-to-DCF (Earnings Based) 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.

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For the Travel & Leisure industry and Consumer Cyclical sector, Johnson Outdoors's Price-to-DCF (Earnings Based) distribution charts can be found below:

* The bar in red indicates where Johnson Outdoors's Price-to-DCF (Earnings Based) falls into.

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Johnson Outdoors Intrinsic Value: DCF (Earnings Based) Calculation

This is the intrinsic value calculated from the Discounted Earnings model with default parameters. The calculation method is the same as Discounted Cash Flow model except earnings are used in the calculation instead of free cash flow. This is the default method of calculation with GuruFocus DCF calculator.

Usually a two-stage model is used in calculating the intrinsic value with discounted cash flow model. The first stage is called growth stage; the second is called the terminal stage. In the growth stage the company grows at a faster rate. Because it cannot grow at that rate forever, a lower rate is used for the terminal stage.

GuruFocus DCF calculator is a two-stage model. The default values are defined as:

1. Discount Rate: d = 11%
A reasonable discount rate assumption should be at least the long term average return of the stock market, which can be estimated from risk free rate plus risk premium of stock market. GuruFocus uses 10-Year Treasury Constant Maturity Rate as the risk-free rate and rounded up to the nearest integer. It is updated daily. The current risk-free rate is 4.64%. Please go to Economic Indicators page for more information. Please note that we use the 10-Year Treasury Constant Maturity Rate of the country/region where the company is headquartered. If the data for that country/region is not available, then we will use the 10-Year Treasury Constant Maturity Rate of the United States as default. Then we added a risk premium of 6% to get the estimated discount rate. Some investors use their expected rate of return, which is also reasonable. A typical discount rate can be anywhere between 6% - 20%.

2. Growth Rate in the growth stage: g1 = 12.60%
The Growth Rate in the growth stage is initially set as the default 10-Year EPS without NRI Growth Rate. In cases where the 10-year growth rate is unavailable, it defaults to using the 5-Year EPS without NRI Growth Rate. If both the 10-year and 5-year growth rates are unavailable, the system defaults to the 3-Year EPS without NRI Growth Rate.
However, it's important to note that there is a growth rate range. If the calculated growth rate exceeds 20%, it will be capped at 20%. Conversely, if the calculated growth rate falls below 5%, it will be adjusted to 5% to maintain a reasonable range.
=> Johnson Outdoors's average EPS without NRI Growth Rate in the past 10 years was 12.60%, which is between 5% and 20%. => GuruFocus defaults => Growth Rate: 12.60%

3. Years of Growth Stage: y1 = 10

4. Terminal Growth Rate: g2 = 4%

5. Years of Terminal Growth: y2 = 10

6. EPS without NRI: eps without nri = $1.708.
GuruFocus DCF calculator is actually a Discounted Earnings calculator, EPS without NRI is used as the default. The reason we are doing this is we found that historically stock prices are more correlated with earnings than free cash flow.

All of the default settings can be changed and the results are calculated automatically.

Johnson Outdoors's Intrinsic Value: DCF (Earnings Based) for today is calculated as:

set x = (1+g1)/(1+d) = (1+0.126)/(1+0.11) = 1.0144144144144
and y = (1+g2)/(1+d) = (1+0.04)/(1+0.11) = 0.93693693693694

* 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.

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Johnson Outdoors  (NAS:JOUT) Intrinsic Value: DCF (Earnings Based) Explanation

Unlike valuation methods such as Net Current Asset Value, Tangible Book Value per Share, Graham Number, Median Ratio etc, discounted Cash Flow model evaluates the companies based on their future earnings power instead of their assets.

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Be Aware

What you need to know about Discounted Earnings model:

1. The Discounted Earnings model evaluates a company based on its future earnings power
2. Growth is taken into account; therefore a faster growth company is worth more if everything else is the same.
3. Since we are projecting future growth, it is assumed that the company will grow at the same rate as it did during the past 10 years. Therefore this model works better for the companies that are relatively consistent performers.
4. The Discounted Earnings model works poorly for inconsistent performers like cyclicals.
5. Your expected return from the investment is a reasonable discount rate assumption.
6. A larger margin of safety should be required for companies with less predictable businesses.

You can screen for stocks that trade below their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) with the GuruFocus All-in-One Screener. Companies with a high Predictability Rank that trade at a discount to their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) can be found in the screen of Undervalued Predictable Companies.

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Johnson Outdoors Intrinsic Value: DCF (Earnings Based) Related Terms

Thank you for viewing the detailed overview of Johnson Outdoors's Intrinsic Value: DCF (Earnings Based) provided by GuruFocus.com. Please click on the following links to see related term pages.

Predictability Rank Intrinsic Value: DCF (FCF Based) Intrinsic Value: DCF (Dividends Based) Intrinsic Value: Projected FCF EPS without NRI Free Cash Flow Margin of Safety % (DCF FCF Based) Margin of Safety % (DCF Earnings Based) Margin of Safety % (DCF Dividends Based)

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Johnson Outdoors (Johnson Outdoors) Business Description

Executives

David W Johnson	officer: VP and Chief Financial Officer	C/O JOHNSON OUTDOORS INC., 555 MAIN STREET, RACINE WI 53403
Jeffrey M Stutz	director	855 EAST MAIN, ZEELAND MI 49464
Fahey John M Jr	director	C/O NATINAL GEOGRAPHIC, 1146 17TH STREET NW, WASHINTON DC 20036
Liliann Annie Zipfel	director	555 MAIN STREET, RACINE WI 53403
Paul Garvin Alexander	director	2400 MASSACHUSETTS AVENUE, LEXINGTON MA 02421
Pyle Thomas F Jr	director	3500 CORBEN COURT, MADISON WI 53704
Edward F Lang	director	C/O JOHNSON OUTDOORS INC., 555 MAIN STREET, RACINE WI 53403
Terry E London	director	100 PIER 1 PLACE, FORT WORTH TX 76102
Richard Case Sheahan	director	C/O JOHNSON OUTDOORS INC., 555 MAIN STREET, RACINE WI 53403
William D Perez	director
Edward A Stevens	director	555 MAIN STREET, RACINE WI 53403
Katherine Button Bell	director	10 PICARDY LANE, ST LOUIS MO 63124
Towerview Llc	10 percent owner	460 PARK AVENUE, NEW YORK NY 10022
Johnson Leipold Helen P	director, 10 percent owner, officer: Chairman and CEO	C/OJ/K MANAGEMENT SERVICES INC, 555 MAIN STREET, RACINE WI 53403-1015
Daniel R Tisch	10 percent owner	460 PARK AVENUE, NEW YORK NY 10022