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GuruFocus has detected 4 Warning Signs with Enterprise Products Partners LP $EPD.
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Enterprise Products Partners LP (NYSE:EPD)
Intrinsic Value: Projected FCF
$9.96 (As of Today)

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value: DCF (FCF Based), or Discounted Earnings Intrinsic Value: DCF (Earnings Based) 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, Enterprise Products Partners LP's projected FCF intrinsic value is $9.96. The stock price of Enterprise Products Partners LP is $26.89. Therefore, Enterprise Products Partners LP's Price to Intrinsic Value: Projected FCF Ratio of today is 2.7.

EPD' s Price-to-Intrinsic-Value-Projected-FCF Range Over the Past 10 Years
Min: 1.12   Max: 15.99
Current: 2.7

1.12
15.99

During the past 13 years, the highest Price to Intrinsic Value: Projected FCF Ratio of Enterprise Products Partners LP was 15.99. The lowest was 1.12. And the median was 3.49.

EPD's Price-to-Intrinsic-Value-Projected-FCF is ranked lower than
66% of the 47 Companies
in the Global Oil & Gas Midstream industry.

( Industry Median: 2.10 vs. EPD: 2.70 )

Definition

Since the intrinsic value calculations based on Discounted Cash Flow Intrinsic Value: DCF (FCF Based), or Discounted Earnings Intrinsic Value: DCF (Earnings Based) 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 Enterprise Products Partners LP's FCF(6 year avg) is calculate as

Enterprise Products Partners LP Quarterly Data

201412201503201506201509201512201603201606201609201612201703
total_freecashflow 444141122-303211-10872250827430
201206201209201212201303201306201309201312201403201406201409
total_freecashflow -107-626369368-285-131504704-19139
201106201109201112201203
total_freecashflow -51-60227-368

Add all the Free Cash Flow together and divide 6 will get Enterprise Products Partners LP's FCF(6 year avg) = $335.40.

Enterprise Products Partners LP's Intrinsic Value: Projected FCF for today is calculated as

Intrinsic Value=(Growth Multiple*Free Cash Flow(6 year avg)+Total Equity(Mar17)*0.8)/Shares Outstanding
=(9.52035159596*335.4+22579.3*0.8)/2134.900
=9.96

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.

Enterprise Products Partners LP's Price to Intrinsic Value: Projected FCF Ratio for today is calculated as

Price to Intrinsic Value: Projected FCF=Share Price/Intrinsic Value: Projected FCF
=26.89/9.95670332347
=2.70

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Related Terms

Intrinsic Value: DCF (Earnings Based), Intrinsic Value: DCF (FCF Based), Free Cash Flow


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Enterprise Products Partners LP Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
Projected FCF 4.101.40-0.604.063.823.955.438.718.769.58

Enterprise Products Partners LP Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
Projected FCF 8.719.749.849.378.768.628.859.099.589.96
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