PWOD- NAS (USA)

Penns Woods Bancorp Inc

Penns Woods Bancorp Inc

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Average gain of all 2.5-Star stocks: 7.3% per year.

% of Stocks that are in still loss if held for 10yrs: 18%.

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$26.34 0.85(3.34%) Volume: 4,778 11:35AM EST

Avg Vol (1m): 7,354
Market Cap : 185.95 M | Enterprise Value : 131.45 M | P/E (TTM) : 13.31 | P/B : 1.15 |
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Penns Woods Bancorp's free cash flow per share for the
three
months ended in **Sep. 2020** was **$0.34**.
Its free cash flow per share for the **trailing twelve months (TTM)** ended in **Sep. 2020** was **$1.35**.

During the **past 12 months**, the average Free Cash Flow per Share Growth Rate of Penns Woods Bancorp was **-26.50%** per year.
During the **past 3 years**, the average Free Cash Flow per Share Growth Rate was **-2.00%** per year.
During the **past 5 years**, the average Free Cash Flow per Share Growth Rate was **-3.20%** per year.
During the **past 10 years**, the average Free Cash Flow per Share Growth Rate was **1.80%** per year.
Please click **Growth Rate Calculation Example (GuruFocus)** to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Free Cash Flow Growth Rate using Free Cash Flow per Share data.

During the **past 13 years**, Penns Woods Bancorp's **highest** 3-Year average Free Cash Flow per Share Growth Rate was **51.80%** per year. The **lowest** was **-13.00%** per year. And the **median** was **4.20%** per year.

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

* Premium members only.

Free Cashflow per Share is the amount of Free Cashflow per outstanding share of the company's stock.

Free Cash Flow is considered one of the most important parameters to measure a company's earnings power by value investors because it is not subject to estimates of Depreciation, Depletion and Amortization (DDA). However, when we look at the Free Cash Flow, we should look from a long term perspective, because any year's Free Cash Flow can be drastically affected by the spending on Property, Plant, & Equipment (PPE) of the business in that year. Over the long term, Free Cash Flow should give pretty good picture on the real earnings power of the company.

Note: GuruFocus does not calculate Free Cash Flow Per Share when Capital Expenditure is 0.

Penns Woods Bancorp's Free Cash Flow Per Share for the **fiscal year** that ended in **Dec. 2019** is calculated as

Free Cash Flow Per Share | (A: Dec. 2019 ) | ||||

= | (Cash Flow from Operations | + | Capital Expenditure) | / | Shares Outstanding (Diluted Average) |

= | (14.05 | + | -2.706) | / | 7.113 |

= | 11.344 | / | 7.113 | ||

= | 1.59 |

Penns Woods Bancorp's Free Cash Flow Per Share for the **quarter** that ended in **Sep. 2020** is calculated as

Free Cash Flow Per Share | (Q: Sep. 2020 ) | ||||

= | (Cash Flow from Operations | + | Capital Expenditure) | / | Shares Outstanding (Diluted Average) |

= | (2.912 | + | -0.544) | / | 7.045 |

= | 2.368 | / | 7.045 | ||

= | 0.34 |

Free Cash Flow per Share for the trailing twelve months (TTM) ended in Sep. 2020 was -0.358 (Dec. 2019 ) + 0.994 (Mar. 2020 ) + 0.375 (Jun. 2020 ) + 0.336 (Sep. 2020 ) = $1.35

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

Free Cash Flow is very close to Warren Buffett's definition of Owner's Earnings, except that in Warren Buffett's Owner's Earnings, the spending for Property, Plant, and Equipment is only for maintenance (replacement), while in the Free Cash Flow calculation, the cost of new Property, Plant, and Equipment due to business expansion is also deducted. There, Free Cash Flow is more conservative than Owner's Earnings.

In Don Yacktman's calculation of forward rate of return, he uses Free Cash Flow for the calculation. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation.

This is what Yacktman said in his March 2012 interview - when the S&P 500 was at 1400:

If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.

The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).

For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over seven years. The reason we use seven years is because research shows that seven years is the length of the typical business cycle.

Therefore, as of **Dec19**, Penns Woods Bancorp's Forward Rate of Return (Yacktman) % is

Forward Rate of Return (Yacktman) % (Dec19) | = | Normalized Free Cash Flow | / | Price | + | 5-Year EBITDA Growth Rate |

= | 0 | / | 19.85 | + | 0 | |

= | 0.00 % |

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

Free Cash Flow within a report period can be affected by management's decisions of capital spending. Therefore, it is important to look at long term when it comes to Free Cash Flow.

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