Expeditors International of Washington Inc Valuation – January 2019 $EXPD

Company Profile (excerpt from Reuters): Expeditors International of Washington, Inc., incorporated on May 29, 1979, is a logistics company. The Company is a third-party logistics provider, and purchases cargo space from carriers, including airlines and ocean shipping lines on a volume basis and resells that space to its customers. The Company provides a range of customer solutions, such as order management, time-definite transportation, warehousing and distribution, temperature-controlled transit, cargo insurance and customized logistics solutions. In addition, the Company’s Project Cargo unit handles special project shipments that move through a single method or combination of air, ocean, and/or ground transportation. The Company’s services include airfreight services, ocean freight and ocean services, and customs brokerage and other services. The Company operates along five geographic areas: the Americas; North Asia; South Asia; Europe, and the Middle East, Africa and India.

 

Downloadable PDF version of this valuation:

ModernGraham Valuation of EXPD – January 2019

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $11,805,156,263 Pass
2. Sufficiently Strong Financial Condition Current Ratio > 2 1.99 Fail
3. Earnings Stability Positive EPS for 10 years prior Pass
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end 85.52% Pass
6. Moderate PEmg Ratio PEmg < 20 25.05 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 6.19 Fail
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 1.99 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 0.00 Pass
3. Earnings Stability Positive EPS for 5 years prior Pass
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Pass

 

Stage 2: Determination of Intrinsic Value

EPSmg $2.73
MG Growth Estimate 8.45%
MG Value $69.36
Opinion Fairly Valued
MG Grade B-
MG Value based on 3% Growth $39.59
MG Value based on 0% Growth $23.21
Market Implied Growth Rate 8.27%
Current Price $68.40
% of Intrinsic Value 98.61%

Expeditors International of Washington is suitable for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio, high PEmg and PB ratios. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the analysis.

As for a valuation, the company appears to be Fairly Valued after growing its EPSmg (normalized earnings) from $1.75 in 2014 to an estimated $2.73 for 2018. This level of demonstrated earnings growth supports the market’s implied estimate of 8.27% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

At the time of valuation, further research into Expeditors International of Washington revealed the company was trading above its Graham Number of $28.87. The company pays a dividend of $0.84 per share, for a yield of 1.2% Its PEmg (price over earnings per share – ModernGraham) was 25.05, which was above the industry average of 17.22. Finally, the company was trading above its Net Current Asset Value (NCAV) of $7.73.

Expeditors International of Washington performs fairly well in the ModernGraham grading system, scoring a B-.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) $7.73
Graham Number $28.87
PEmg 25.05
Current Ratio 1.99
PB Ratio 6.19
Current Dividend $0.84
Dividend Yield 1.23%
Number of Consecutive Years of Dividend Growth 20

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 9/1/2018
Total Current Assets $2,746,473,000
Total Current Liabilities $1,377,468,000
Long-Term Debt $0
Total Assets $3,334,800,000
Intangible Assets $7,927,000
Total Liabilities $1,377,468,000
Shares Outstanding (Diluted Average) 177,173,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $3.28
Dec2017 $2.69
Dec2016 $2.36
Dec2015 $2.40
Dec2014 $1.92
Dec2013 $1.68
Dec2012 $1.57
Dec2011 $1.79
Dec2010 $1.59
Dec2009 $1.11
Dec2008 $1.37
Dec2007 $1.21
Dec2006 $1.06
Dec2005 $0.86
Dec2004 $0.59
Dec2003 $0.46
Dec2002 $0.44
Dec2001 $0.45
Dec2000 $0.38
Dec1999 $0.28
Dec1998 $0.22

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $2.73
Dec2017 $2.37
Dec2016 $2.14
Dec2015 $1.98
Dec2014 $1.75
Dec2013 $1.62
Dec2012 $1.56
Dec2011 $1.51
Dec2010 $1.33
Dec2009 $1.18
Dec2008 $1.15
Dec2007 $0.97
Dec2006 $0.79
Dec2005 $0.62
Dec2004 $0.49
Dec2003 $0.43
Dec2002 $0.39

Recommended Reading:

Other ModernGraham posts about the company

Best Dividend Paying Stocks for Dividend Growth Investors – April 2018
Expeditors International of Washington Inc Valuation – March 2018 $EXPD
Expeditors International of Washington Valuation – June 2016 $EXPD
Expeditors International of Washington Valuation – January 2016 Update $EXPD
Expeditors International of Washington Analysis – October 2015 Update $EXPD

Other ModernGraham posts about related companies

Kirby Corp Valuation – September 2018 $KEX
Knight-Swift Transportation Holdings Inc Valuation – August 2018 $KNX
Saia Inc Valuation – July 2018 $SAIA
Ryder System Inc Valuation – June 2018 $R
United Parcel Service Inc Valuation – May 2018 $UPS
JB Hunt Transport Services Inc Valuation – May 2018 $JBHT
C.H. Robinson Worldwide Inc Valuation – April 2018 $CHRW
FedEx Corp Valuation – April 2018 $FDX
Expeditors International of Washington Inc Valuation – March 2018 $EXPD
TFI International Inc Valuation – Initial Coverage $TSE:TFII

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

SpartanNash Co Valuation – August 2018 $SPTN

Company Profile (excerpt from Reuters): SpartanNash Company, incorporated on April 16, 1918, is a multi-regional grocery distributor and grocery retailer. The Company’s core businesses include distributing grocery products to independent grocery retailers (independent retailers), select national retailers, its corporate owned retail stores, and the United States military commissaries. The Company operates through three segments: Food Distribution, Military and Retail. The Company’s Food Distribution segment provides a range of nationally branded and private brand grocery products and perishable food products to independent retailers, food service distributors and the Company’s corporate owned retail stores. The Company’s Military segment contracts with manufacturers to distribute a range of grocery products primarily to military commissaries and exchanges located in the United States, the District of Columbia, Europe, Cuba, Puerto Rico, Bahrain and Egypt. As of December 31, 2016, the Company’s Retail segment operated 157 corporate owned retail stores in the Midwest and Great Lakes regions primarily under the banners of Family Fare Supermarkets, VG’s Food and Pharmacy, D&W Fresh Markets, Sun Mart and Family Fresh Market.

 

Downloadable PDF version of this valuation:

ModernGraham Valuation of SPTN – August 2018

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $868,419,305 Fail
2. Sufficiently Strong Financial Condition Current Ratio > 2 2.12 Pass
3. Earnings Stability Positive EPS for 10 years prior Fail
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end -45.02% Fail
6. Moderate PEmg Ratio PEmg < 20 23.80 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 1.17 Pass
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 2.12 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 1.41 Fail
3. Earnings Stability Positive EPS for 5 years prior Fail
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Fail

 

Stage 2: Determination of Intrinsic Value

EPSmg $0.99
MG Growth Estimate -4.25%
MG Value $0.00
Opinion Overvalued
MG Grade C
MG Value based on 3% Growth $14.36
MG Value based on 0% Growth $8.42
Market Implied Growth Rate 7.65%
Current Price $23.58
% of Intrinsic Value N/A

SpartanNash Co does not satisfy the requirements of either the Enterprising Investor or the more conservative Defensive Investor. The Defensive Investor is concerned with the small size, insufficient earnings stability or growth over the last ten years, and the high PEmg ratio. The Enterprising Investor has concerns regarding the level of debt relative to the net current assets, and the lack of earnings stability or growth over the last five years. As a result, all value investors following the ModernGraham approach should explore other opportunities at this time or proceed cautiously with a speculative attitude.

As for a valuation, the company appears to be Overvalued after seeing its EPSmg (normalized earnings) decline from $1.39 in 2014 to an estimated $0.99 for 2018. This level of demonstrated earnings growth does not support the market’s implied estimate of 7.65% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into SpartanNash Co revealed the company was trading below its Graham Number of $31.45. The company pays a dividend of $0.66 per share, for a yield of 2.8%, putting it among the best dividend paying stocks today. Its PEmg (price over earnings per share – ModernGraham) was 23.8, which was below the industry average of 26.3, which by some methods of valuation makes it one of the most undervalued stocks in its industry. Finally, the company was trading above its Net Current Asset Value (NCAV) of $-9.01.

SpartanNash Co receives an average overall rating in the ModernGraham grading system, scoring a C.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) -$9.01
Graham Number $31.45
PEmg 23.80
Current Ratio 2.12
PB Ratio 1.17
Current Dividend $0.66
Dividend Yield 2.80%
Number of Consecutive Years of Dividend Growth 6

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 3/1/2018
Total Current Assets $985,166,000
Total Current Liabilities $464,513,000
Long-Term Debt $733,367,000
Total Assets $2,016,937,000
Intangible Assets $311,213,000
Total Liabilities $1,304,893,000
Shares Outstanding (Diluted Average) 35,480,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $2.22
Dec2017 -$1.41
Dec2016 $1.51
Dec2015 $1.66
Dec2014 $1.55
Mar2013 $1.25
Mar2012 $1.39
Mar2011 $1.42
Mar2010 $1.14
Mar2009 $1.66
Mar2008 $1.58
Mar2007 $1.18
Mar2006 $0.86
Mar2005 $0.91
Mar2004 -$0.33
Mar2003 -$6.15
Mar2002 $0.50
Mar2001 $1.35
Mar2000 $1.28
Mar1999 $1.02
Mar1998 $0.94

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $0.99
Dec2017 $0.55
Dec2016 $1.52
Dec2015 $1.50
Dec2014 $1.39
Mar2013 $1.33
Mar2012 $1.40
Mar2011 $1.40
Mar2010 $1.35
Mar2009 $1.39
Mar2008 $1.11
Mar2007 $0.35
Mar2006 -$0.32
Mar2005 -$0.86
Mar2004 -$1.38
Mar2003 -$1.41
Mar2002 $0.98

Recommended Reading:

Other ModernGraham posts about the company

SpartanNash Co Valuation – Initial Coverage $SPTN

Other ModernGraham posts about related companies

Core-Mark Holding Co Inc Valuation – August 2018 $CORE
J&J Snack Foods Corp Valuation – August 2018 $JJSF
Coca-Cola European Partners PLC Valuation – July 2018 $CCE
Seneca Foods Corp Valuation – July 2018 $SENEA
Saputo Inc Valuation – July 2018 $TSE-SAP
Ingredion Inc Valuation – July 2018 $INGR
B&G Foods Inc Valuation – July 2018 $BGS
Tyson Foods Inc Valuation – June 2018 $TSN
Mondelez International Inc Valuation – June 2018 $MDLZ
Hormel Foods Corp Valuation – June 2018 $HRL

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Intrepid Potash Inc Valuation – July 2018 $IPI

Company Profile (excerpt from Reuters): Intrepid Potash, Inc., incorporated on November 19, 2007, is a producer of muriate of potash (potassium chloride or potash) and langbeinite (sulfate of potash magnesia) in the United States, which it markets and sells as Trio. The Company operates in the extraction, production and sale of potassium-related products. Its products are potash and Trio. The Company also produces salt, magnesium chloride, metal recovery salts and brine containing salt and potassium from its mining processes. Its salt is used in a variety of markets, including animal feed, industrial applications, pool salt, and the treatment of roads and walkways for ice melting or to manage road conditions. It is also sold as a nutrient supplement in animal feed and for use in other industrial processes. Its brines are used primarily by the oil and gas industry to support well development and completion activities.

 

Downloadable PDF version of this valuation:

ModernGraham Valuation of IPI – July 2018

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $529,848,805 Fail
2. Sufficiently Strong Financial Condition Current Ratio > 2 3.28 Pass
3. Earnings Stability Positive EPS for 10 years prior Fail
4. Dividend Record Dividend Payments for 10 years prior Fail
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end -135.13% Fail
6. Moderate PEmg Ratio PEmg < 20 -3.73 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 1.34 Fail
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 3.28 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 0.60 Pass
3. Earnings Stability Positive EPS for 5 years prior Fail
4. Dividend Record Currently Pays Dividend Fail
5. Earnings Growth EPSmg greater than 5 years ago Fail

 

Stage 2: Determination of Intrinsic Value

EPSmg -$1.11
MG Growth Estimate -4.25%
MG Value $0.08
Opinion Overvalued
MG Grade D
MG Value based on 3% Growth -$16.13
MG Value based on 0% Growth -$9.46
Market Implied Growth Rate -6.11%
Current Price $4.15
% of Intrinsic Value 5182.64%

Intrepid Potash, Inc. does not satisfy the requirements of either the Enterprising Investor or the more conservative Defensive Investor. The Defensive Investor is concerned with the small size, insufficient earnings stability or growth over the last ten years, and the poor dividend history, and the high PEmg and PB ratios. The Enterprising Investor has concerns regarding the lack of earnings stability or growth over the last five years, and the lack of dividends. As a result, all value investors following the ModernGraham approach should explore other opportunities at this time or proceed cautiously with a speculative attitude.

As for a valuation, the company appears to be Overvalued after seeing its EPSmg (normalized earnings) decline from $0.59 in 2014 to an estimated $-1.11 for 2018. This level of negative earnings does not support a positive valuation.As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into Intrepid Potash, Inc. revealed the company was trading above its Graham Number of $2.66. The company does not pay a dividend. Its PEmg (price over earnings per share – ModernGraham) was -3.73, which was below the industry average of 30.52, which by some methods of valuation makes it one of the most undervalued stocks in its industry. Finally, the company was trading above its Net Current Asset Value (NCAV) of $0.08.

Intrepid Potash, Inc. scores quite poorly in the ModernGraham grading system, with an overall grade of D.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) $0.08
Graham Number $2.66
PEmg -3.73
Current Ratio 3.28
PB Ratio 1.34
Current Dividend $0.00
Dividend Yield 0.00%
Number of Consecutive Years of Dividend Growth 0

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 3/1/2018
Total Current Assets $117,750,000
Total Current Liabilities $35,916,000
Long-Term Debt $49,470,000
Total Assets $512,022,000
Intangible Assets $0
Total Liabilities $107,279,000
Shares Outstanding (Diluted Average) 130,765,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $0.10
Dec2017 -$0.20
Dec2016 -$0.88
Dec2015 -$6.94
Dec2014 $0.13
Dec2013 $0.30
Dec2012 $1.16
Dec2011 $1.45
Dec2010 $0.60
Dec2009 $0.74
Dec2008 $1.31
Dec2007 $0.39

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate -$1.11
Dec2017 -$1.65
Dec2016 -$2.00
Dec2015 -$1.97
Dec2014 $0.59
Dec2013 $0.83
Dec2012 $1.08
Dec2011 $0.99
Dec2010 $0.71
Dec2009 $0.67
Dec2008 $0.54
Dec2007 $0.13

Recommended Reading:

Other ModernGraham posts about the company

Intrepid Potash Inc Valuation – Initial Coverage $IPI

Other ModernGraham posts about related companies

Mosaic Company Valuation – May 2018 $MOS
CF Industries Holdings Inc Valuation – April 2018 $CF
LSB Industries Inc Valuation – Initial Coverage $LXU
Monsanto Company Valuation – March 2017 $MON
Mosaic Company Valuation – February 2017 $MOS
Scotts Miracle-Gro Inc Valuation – Initial Coverage $SMG
Intrepid Potash Inc Valuation – Initial Coverage $IPI
CF Industries Holdings Inc Valuation – August 2016 $CF
CF Industries Valuation – March 2016 $CF
Monsanto Company Valuation – January 2016 Update $MON

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Expeditors International of Washington Inc Valuation – March 2018 $EXPD

Company Profile (obtained from Marketwatch): Expeditors International of Washington, Inc. engages in the provision of global logistics services. It offers airfreight services, ocean freight and ocean services, and customs brokerage and other services. The firm also provides customer solutions such as order management, time-definite transportation, warehousing and distribution, temperature-controlled transit, cargo insurance, and customized logistics solutions. It operates through the following geographical segments: Americas; North Asia; South Asia; Europe; and Middle East, Africa, and India. The company was founded by Peter Rose, Wang Li Kou, Kevin Walsh, Hank Wong, George Ho, Robert Chiarito, and Glenn Alger in May 1979 and is headquartered in Seattle, WA.

 

Downloadable PDF version of this valuation:

ModernGraham Valuation of EXPD – March 2018

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $11,387,197,415 Pass
2. Sufficiently Strong Financial Condition Current Ratio > 2 2.32 Pass
3. Earnings Stability Positive EPS for 10 years prior Pass
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end 73.50% Pass
6. Moderate PEmg Ratio PEmg < 20 25.12 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 5.82 Fail
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 2.32 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 0.00 Pass
3. Earnings Stability Positive EPS for 5 years prior Pass
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Pass

 

Stage 2: Determination of Intrinsic Value

EPSmg $2.55
MG Growth Estimate 6.90%
MG Value $56.90
Opinion Overvalued
MG Grade B-
MG Value based on 3% Growth $36.98
MG Value based on 0% Growth $21.68
Market Implied Growth Rate 8.31%
Current Price $64.08
% of Intrinsic Value 112.61%

Expeditors International of Washington is suitable for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the high PEmg and PB ratios. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the analysis.

As for a valuation, the company appears to be Overvalued after growing its EPSmg (normalized earnings) from $1.75 in 2014 to an estimated $2.55 for 2018. This level of demonstrated earnings growth does not support the market’s implied estimate of 8.31% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into Expeditors International of Washington revealed the company was trading above its Graham Number of $26.39. The company pays a dividend of $0.84 per share, for a yield of 1.3% Its PEmg (price over earnings per share – ModernGraham) was 25.12, which was below the industry average of 36.6, which by some methods of valuation makes it one of the most undervalued stocks in its industry. Finally, the company was trading above its Net Current Asset Value (NCAV) of $7.83.

Expeditors International of Washington performs fairly well in the ModernGraham grading system, scoring a B-.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) $7.83
Graham Number $26.39
PEmg 25.12
Current Ratio 2.32
PB Ratio 5.82
Current Dividend $0.84
Dividend Yield 1.31%
Number of Consecutive Years of Dividend Growth 20

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 12/1/2017
Total Current Assets $2,541,452,000
Total Current Liabilities $1,093,119,000
Long-Term Debt $0
Total Assets $3,117,008,000
Intangible Assets $7,927,000
Total Liabilities $1,125,150,000
Shares Outstanding (Diluted Average) 180,811,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $2.74
Dec2017 $2.69
Dec2016 $2.36
Dec2015 $2.40
Dec2014 $1.92
Dec2013 $1.68
Dec2012 $1.57
Dec2011 $1.79
Dec2010 $1.59
Dec2009 $1.11
Dec2008 $1.37
Dec2007 $1.21
Dec2006 $1.06
Dec2005 $0.86
Dec2004 $0.59
Dec2003 $0.46
Dec2002 $0.44
Dec2001 $0.45
Dec2000 $0.38
Dec1999 $0.28
Dec1998 $0.22

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $2.55
Dec2017 $2.37
Dec2016 $2.14
Dec2015 $1.98
Dec2014 $1.75
Dec2013 $1.62
Dec2012 $1.56
Dec2011 $1.51
Dec2010 $1.33
Dec2009 $1.18
Dec2008 $1.15
Dec2007 $0.97
Dec2006 $0.79
Dec2005 $0.62
Dec2004 $0.49
Dec2003 $0.43
Dec2002 $0.39

Recommended Reading:

Other ModernGraham posts about the company

Expeditors International of Washington Valuation – January 2016 Update $EXPD
Expeditors International of Washington Analysis – October 2015 Update $EXPD
Expeditors International of Washington Analysis – June 2015 Update $EXPD
18 Companies in the Spotlight This Week – 3/21/15
Expeditors International of Washington Quarterly Valuation – March 2015 $EXPD

Other ModernGraham posts about related companies

TFI International Inc Valuation – Initial Coverage $TSE:TFII
Landstar System Inc Valuation – Initial Coverage $LSTR
Kirby Corporation Valuation – Initial Coverage $KEX
Knight Transportation Valuation – Initial Coverage $KNX
United Parcel Service Inc Valuation – February 2017 $UPS
SPS Commerce Inc Valuation – Initial Coverage $SPSC
J B Hunt Transport Services Inc Valuation – Initial Coverage $JBHT
Celadon Group Inc Valuation – Initial Coverage $CGI
Saia Inc Valuation – Initial Coverage $SAIA
C.H. Robinson Worldwide Inc Valuation – August 2016 $CHRW

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Ashland Global Holdings Inc Valuation – March 2018 $ASH

Company Profile (obtained from Marketwatch): Ashland Global Holdings, Inc. is a global specialty chemicals company, which engages in the manufacture and distribution of adhesives, architectural coatings, automotive, construction, energy, food and beverage, personal care and pharmaceutical. It operates through three segments: Specialty Ingredients, Composites, and Intermediates & Solvents. The Specialty Ingredients segment offers solutions for consumer and industrial applications. The Composites segment manufactures and sells grade of unsaturated polyester and vinyl ester resins, gelcoats and low-profile additives for the reinforced plastics industry. The Intermediates and Solvents segment produces butanedioland related derivatives, including tetrahydrofuran and n-methylpyrrolidone. The company was founded on May 6, 2016 and is headquartered in Covington. KY.

ASH Chart

ASH data by YCharts

 

Downloadable PDF version of this valuation:

ModernGraham Valuation of ASH – March 2018

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $4,497,276,200 Pass
2. Sufficiently Strong Financial Condition Current Ratio > 2 1.96 Fail
3. Earnings Stability Positive EPS for 10 years prior Fail
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end -68.52% Fail
6. Moderate PEmg Ratio PEmg < 20 42.67 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 1.31 Pass
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 1.96 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 2.69 Fail
3. Earnings Stability Positive EPS for 5 years prior Fail
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Fail

 

Stage 2: Determination of Intrinsic Value

EPSmg $1.69
MG Growth Estimate -4.25%
MG Value $0.00
Opinion Overvalued
MG Grade F
MG Value based on 3% Growth $24.50
MG Value based on 0% Growth $14.36
Market Implied Growth Rate 17.08%
Current Price $72.08
% of Intrinsic Value N/A

Ashland Global Holdings Inc. does not satisfy the requirements of either the Enterprising Investor or the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio, insufficient earnings stability or growth over the last ten years, and the high PEmg ratio. The Enterprising Investor has concerns regarding the level of debt relative to the net current assets, and the lack of earnings stability or growth over the last five years. As a result, all value investors following the ModernGraham approach should explore other opportunities at this time or proceed cautiously with a speculative attitude.

As for a valuation, the company appears to be Overvalued after seeing its EPSmg (normalized earnings) decline from $4.16 in 2014 to an estimated $1.69 for 2018. This level of demonstrated earnings growth does not support the market’s implied estimate of 17.08% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into Ashland Global Holdings Inc. revealed the company was trading above its Graham Number of $60.19. The company pays a dividend of $1.23 per share, for a yield of 1.7% Its PEmg (price over earnings per share – ModernGraham) was 42.67, which was above the industry average of 31.55. Finally, the company was trading above its Net Current Asset Value (NCAV) of $-53.1.

Ashland Global Holdings Inc. scores quite poorly in the ModernGraham grading system, with an overall grade of F.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) -$53.10
Graham Number $60.19
PEmg 42.67
Current Ratio 1.96
PB Ratio 1.31
Current Dividend $1.23
Dividend Yield 1.71%
Number of Consecutive Years of Dividend Growth 0

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 12/1/2017
Total Current Assets $1,964,000,000
Total Current Liabilities $1,003,000,000
Long-Term Debt $2,584,000,000
Total Assets $8,655,000,000
Intangible Assets $3,773,000,000
Total Liabilities $5,256,000,000
Shares Outstanding (Diluted Average) 62,000,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $2.95
Sep2017 $0.01
Sep2016 -$0.47
Sep2015 $4.48
Sep2014 $3.00
Sep2013 $8.57
Sep2012 $0.33
Sep2011 $5.17
Sep2010 $1.78
Sep2009 $0.96
Sep2008 $2.63
Sep2007 $3.60
Sep2006 $5.64
Sep2005 $26.85
Sep2004 $5.25
Sep2003 $1.10
Sep2002 $1.67
Sep2001 $5.93
Sep2000 $0.98
Sep1999 $3.89
Sep1998 $2.63

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $1.69
Sep2017 $1.75
Sep2016 $2.80
Sep2015 $4.40
Sep2014 $4.16
Sep2013 $4.28
Sep2012 $2.15
Sep2011 $2.98
Sep2010 $2.23
Sep2009 $4.28
Sep2008 $6.89
Sep2007 $8.85
Sep2006 $10.35
Sep2005 $11.19
Sep2004 $3.23
Sep2003 $2.39
Sep2002 $3.03

Recommended Reading:

Other ModernGraham posts about the company

5 Undervalued Companies for the Defensive Investor Near 52 Week Lows – February 2016
19 Best Stocks For Value Investors This Week – 1/9/16
Ashland Inc Valuation – January 2016 Update $ASH
19 Best Stocks For Value Investors This Week – 8/29/15
Ashland Inc. Analysis – Initial Coverage $ASH

Other ModernGraham posts about related companies

Koppers Holdings Inc Valuation – March 2018 $KOP
Kraton Corp Valuation – March 2018 $KRA
Quaker Chemical Corp Valuation – March 2018 $KWR
Sensient Technologies Corp Valuation – March 2018 $SXT
Albemarle Corp Valuation – March 2018 $ALB
Praxair Inc Valuation – March 2018 $PX
Ingevity Corp Valuation – March 2018 $NGVT
PolyOne Corp Valuation – March 2018 $POL
Green Plains Inc Valuation – March 2018 $GPRE
Eastman Chemical Co Valuation – March 2018 $EMN

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Wabash National Corp Valuation – Initial Coverage $WNC

Benjamin Graham taught that Intelligent Investors must do a thorough fundamental analysis of investment opportunities to determine their intrinsic value and inherent risk.  This is best done by utilizing a systematic approach to analysis that will provide investors with a sense of how a specific company compares to another company or by reviewing the 10 Undervalued Stocks for the Enterprising Investor – August 2017.  By using the ModernGraham method one can review a company’s historical accomplishments and determine an intrinsic value that can be compared across industries.  What follows is a stock analysis showing a specific look at how Wabash National Corp (WNC) fares in the ModernGraham valuation model.

Company Profile (obtained from Google Finance): Wabash National Corporation is a diversified industrial manufacturer and producer of semi-trailers and liquid transportation systems. The Company’s segments include Commercial Trailer Products; Diversified Products, and Corporate and Eliminations segment. The Company designs, manufactures and markets a range of products, including dry freight and refrigerated trailers, platform trailers, bulk tank trailers, dry and refrigerated truck bodies, truck-mounted tanks, intermodal equipment, aircraft refueling equipment, structural composite panels and products, trailer aerodynamic solutions, and specialty food grade and pharmaceutical equipment. The Company’s Commercial Trailer Products segment manufactures standard and customized van and platform trailers, truck bodies and other transportation related equipment. The Company’s Diversified Products segment consists of business units, including Tank Trailer; Aviation & Truck Equipment; Process Systems, and Composites.

WNC Chart

WNC data by YCharts

[level-free]
To read the details of this valuation, you must be logged in as a premium member. If you are not a premium member, please consider becoming one.

Premium members can view a full ModernGraham valuation of the company and have access to download a PDF version of the valuation for easy reference. Recent valuations of the components of the Dow Jones Industrial Average are available for free members, including this one of Microsoft Corporation.  In addition, here is a post detailing what can be found within each individual company’s valuation.

Learn More About Premium Membership

[/level-free]
[not-level-free]

Downloadable PDF version of this valuation:

ModernGraham Valuation of WNC – August 2017

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $1,234,849,518 Fail
2. Sufficiently Strong Financial Condition Current Ratio > 2 2.12 Pass
3. Earnings Stability Positive EPS for 10 years prior Fail
4. Dividend Record Dividend Payments for 10 years prior Fail
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end -143.35% Fail
6. Moderate PEmg Ratio PEmg < 20 14.45 Pass
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 2.76 Pass
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 2.12 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 0.68 Pass
3. Earnings Stability Positive EPS for 5 years prior Pass
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Pass

Stage 2: Determination of Intrinsic Value

EPSmg $1.43
MG Growth Estimate 15.00%
MG Value $55.18
Opinion Undervalued
MG Grade B-
MG Value based on 3% Growth $20.78
MG Value based on 0% Growth $12.18
Market Implied Growth Rate 2.97%
Current Price $20.71
% of Intrinsic Value 37.53%

Wabash National Corporation is suitable for the Enterprising Investor but not the more conservative Defensive Investor.  The Defensive Investor is concerned with the  small size, insufficient earnings stability or growth over the last ten years, and the poor dividend history. The Enterprising Investor has no initial concerns.  As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the analysis.

As for a valuation, the company appears to be Undervalued after growing its EPSmg (normalized earnings) from $0 in 2013 to an estimated $1.43 for 2017.  This level of demonstrated earnings growth outpaces the market’s implied estimate of 2.97% annual earnings growth over the next 7-10 years.  As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value above the price.

At the time of valuation, further research into Wabash National Corporation revealed the company was trading above its Graham Number of $16.12.  The company pays a dividend of $0.06 per share, for a yield of 0.3%  Its PEmg (price over earnings per share – ModernGraham) was 14.45, which was below the industry average of 18.18, which by some methods of valuation makes it one of the most undervalued stocks in its industry.  Finally, the company was trading above its Net Current Asset Value (NCAV) of $0.97.

Wabash National Corporation performs fairly well in the ModernGraham grading system, scoring a B-.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) $0.97
Graham Number $16.12
PEmg 14.45
Current Ratio 2.12
PB Ratio 2.76
Current Dividend $0.06
Dividend Yield 0.29%
Number of Consecutive Years of Dividend Growth 1

[/not-level-free]

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 6/1/2017
Total Current Assets $520,085,000
Total Current Liabilities $245,199,000
Long-Term Debt $186,098,000
Total Assets $932,411,000
Intangible Assets $234,177,000
Total Liabilities $458,961,000
Shares Outstanding (Diluted Average) 63,207,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $1.47
Dec2016 $1.82
Dec2015 $1.50
Dec2014 $0.85
Dec2013 $0.67
Dec2012 $1.53
Dec2011 $0.22
Dec2010 -$3.36
Dec2009 -$3.48
Dec2008 -$4.21
Dec2007 $0.52
Dec2006 $0.30
Dec2005 $3.06
Dec2004 $1.80
Dec2003 -$2.26
Dec2002 -$2.43
Dec2001 -$10.17
Dec2000 -$0.38
Dec1999 $1.59
Dec1998 $0.99
Dec1997 $0.74

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $1.43
Dec2016 $1.37
Dec2015 $1.08
Dec2014 $0.57
Dec2013 $0.00
Dec2012 -$0.85
Dec2011 -$2.05
Dec2010 -$2.80
Dec2009 -$1.93
Dec2008 -$0.68
Dec2007 $0.95
Dec2006 $0.81
Dec2005 $0.05
Dec2004 -$1.87
Dec2003 -$3.38
Dec2002 -$3.32
Dec2001 -$2.99

Recommended Reading:

Other ModernGraham posts about the company

None.  This is the first time ModernGraham has covered the company.

Other ModernGraham posts about related companies

Fox Factory Holding Corp Valuation – Initial Coverage $FOXF
Monro Muffler Brake Inc Valuation – Initial Coverage $MNRO
Group 1 Automotive Inc Valuation – Initial Coverage $GPI
Dana Inc Valuation – Initial Coverage $DAN
Linamar Corp Valuation – Initial Coverage $TSE:LNR
AutoNation Inc Valuation – March 2017 $AN
Superior Industries International Inc Valuation – Initial Coverage $SUP
Canadian Tire Corp Limited Valuation – Initial Coverage $TSE:CTC.A
LKQ Corporation Valuation – Initial Coverage $LKQ
Lithia Motors Inc Valuation – Initial Coverage $LAD

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

SpartanNash Co Valuation – Initial Coverage $SPTN

Benjamin Graham taught that Intelligent Investors must do a thorough fundamental analysis of investment opportunities to determine their intrinsic value and inherent risk.  This is best done by utilizing a systematic approach to analysis that will provide investors with a sense of how a specific company compares to another company or by reviewing the 10 Stocks for Using A Benjamin Graham Value Investing Strategy – February 2017.  By using the ModernGraham method one can review a company’s historical accomplishments and determine an intrinsic value that can be compared across industries.  What follows is a stock analysis showing a specific look at how SpartanNash Co (SPTN) fares in the ModernGraham valuation model.

Company Profile (obtained from Google Finance): Spartannash Company, formerly Spartan Stores, Inc., is a multi-regional grocery distributor and grocery retailer, and a distributor of grocery products to military commissaries in the United States. The Company’s core businesses include distributing food to military commissaries and exchanges, and independent and corporate-owned retail stores located in over 40 states and the District of Columbia, Europe, Cuba, Puerto Rico, Bahrain, Egypt, Honduras, Afghanistan and Bosnia. It operates through three segments: Military, which sells and distributes grocery products to military commissaries and exchanges in the United States and overseas; Food Distribution, which uses a multi-platform sales approach to distribute groceries to independent retail locations and corporate-owned retail stores, and Retail, which operates retail supermarkets. The products it distributes are delivered to over 170 military commissaries and over 440 exchanges located in over 40 states across the United States.

SPTN Chart

SPTN data by YCharts

[level-free]
To read the details of this valuation, you must be logged in as a premium member. If you are not a premium member, please consider becoming one.

Premium members can view a full ModernGraham valuation of the company and have access to download a PDF version of the valuation for easy reference. Recent valuations of the components of the Dow Jones Industrial Average are available for free members, including this one of Microsoft Corporation.  In addition, here is a post detailing what can be found within each individual company’s valuation.

Learn More About Premium Membership

[/level-free]
[not-level-free]

Downloadable PDF version of this valuation:

ModernGraham Valuation of SPTN – February 2017

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

 

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $1,465,921,969 Fail
2. Sufficiently Strong Financial Condition Current Ratio > 2 1.79 Fail
3. Earnings Stability Positive EPS for 10 years prior Pass
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end 9.73% Fail
6. Moderate PEmg Ratio PEmg < 20 24.98 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 1.76 Pass
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 1.79 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 0.00 Pass
3. Earnings Stability Positive EPS for 5 years prior Pass
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Pass

Stage 2: Determination of Intrinsic Value

EPSmg $1.56
MG Growth Estimate 1.74%
MG Value $18.67
Opinion Overvalued
MG Grade C-
MG Value based on 3% Growth $22.60
MG Value based on 0% Growth $13.25
Market Implied Growth Rate 8.24%
Current Price $38.93
% of Intrinsic Value 208.49%

SpartanNash Co is suitable for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the small size, low current ratio, insufficient earnings growth over the last ten years, and the high PEmg ratio. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the analysis.

As for a valuation, the company appears to be Overvalued after growing its EPSmg (normalized earnings) from $1.4 in 2012 to an estimated $1.56 for 2016. This level of demonstrated earnings growth does not support the market’s implied estimate of 8.24% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into SpartanNash Co revealed the company was trading above its Graham Number of $28.34. The company pays a dividend of $0.59 per share, for a yield of 1.5% Its PEmg (price over earnings per share – ModernGraham) was 24.98, which was above the industry average of 19.87. Finally, the company was trading above its Net Current Asset Value (NCAV) of $-6.47.

SpartanNash Co receives an average overall rating in the ModernGraham grading system, scoring a C-.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) -$6.47
Graham Number $28.34
PEmg 24.98
Current Ratio 1.79
PB Ratio 1.76
Current Dividend $0.59
Dividend Yield 1.50%
Number of Consecutive Years of Dividend Growth 5

[/not-level-free]

Useful Links:

 

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 9/1/2016
Total Current Assets $939,748,000
Total Current Liabilities $525,072,000
Long-Term Debt $0
Total Assets $1,993,879,000
Intangible Assets $322,686,000
Total Liabilities $1,178,296,000
Shares Outstanding (Diluted Average) 36,892,000

Earnings Per Share History

EPS History
Next Fiscal Year Estimate $1.64
Dec2015 $1.66
Dec2014 $1.55
Mar2013 $1.25
Mar2012 $1.39
Mar2011 $1.42
Mar2010 $1.14
Mar2009 $1.66
Mar2008 $1.58
Mar2007 $1.18
Mar2006 $0.86
Mar2005 $0.91
Mar2004 -$0.33
Mar2003 -$6.15
Mar2002 $0.50
Mar2001 $1.35
Mar2000 $1.28
Mar1999 $1.02
Mar1998 $0.94
Mar1997 $7.99

Earnings Per Share – ModernGraham History

EPSmg History
Next Fiscal Year Estimate $1.56
Dec2015 $1.50
Dec2014 $1.39
Mar2013 $1.33
Mar2012 $1.40
Mar2011 $1.40
Mar2010 $1.35
Mar2009 $1.39
Mar2008 $1.11
Mar2007 $0.35
Mar2006 -$0.32
Mar2005 -$0.86
Mar2004 -$1.38
Mar2003 -$1.41
Mar2002 $0.98
Mar2001 $1.65
Mar2000 $1.95

Recommended Reading:

Other ModernGraham posts about the company

None. This is the first time ModernGraham has covered the company.

Other ModernGraham posts about related companies

The Kroger Co Valuation – August 2016 $KR
Whole Foods Market Inc Valuation – May 2016 $WFM
Whole Foods Market Inc. Valuation – October 2015 Update $WFM
Kroger Company Analysis – 2015 Update $KR
Whole Foods Market Inc. Quarterly Valuation – May 2015 $WFM
Whole Foods Market Inc. Quarterly Valuation – February 2015 $WFM
Safeway Inc. Quarterly Valuation – December 2014 $SWY
Whole Foods Markets Inc. Quarterly Valuation – October 2014 $WFM
Whole Foods Market Inc. Quarterly Valuation – July 2014 $WFM
Kroger Company Annual Valuation – 2014 $KR

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Intrepid Potash Inc Valuation – Initial Coverage $IPI

Benjamin Graham taught that Intelligent Investors must do a thorough fundamental analysis of investment opportunities to determine their intrinsic value and inherent risk.  This is best done by utilizing a systematic approach to analysis that will provide investors with a sense of how a specific company compares to another company or by reviewing the 10 Stocks for Using A Benjamin Graham Value Investing Strategy – December 2016.  By using the ModernGraham method one can review a company’s historical accomplishments and determine an intrinsic value that can be compared across industries.  What follows is a stock analysis showing a specific look at how Intrepid Potash Inc (IPI) fares in the ModernGraham valuation model.

Company Profile (obtained from Google Finance): Intrepid Potash, Inc. is a producer of muriate of potash (potassium chloride or potash) and langbeinite (sulfate of potash magnesia) in the United States, which it markets and sells as Trio. The Company operates in the extraction, production and sale of potassium containing products segment. Its products are potash and Trio. The Company also produces salt, magnesium chloride and metal recovery salts from its potash mining processes. It owns approximately three solution mining facilities and over two conventional underground facilities that are utilized for producing potash. Its solution mining production comes from the HB mine near Carlsbad, New Mexico, a solution mine near Moab, Utah, and a brine recovery mine in Wendover, Utah. The Company’s production comes from its underground West and East mines near Carlsbad, New Mexico.

IPI Chart

IPI data by YCharts

[level-free]
To read the details of this valuation, you must be logged in as a premium member. If you are not a premium member, please consider becoming one.

Premium members can view a full ModernGraham valuation of the company and have access to download a PDF version of the valuation for easy reference. Recent valuations of the components of the Dow Jones Industrial Average are available for free members, including this one of Microsoft Corporation.  In addition, here is a post detailing what can be found within each individual company’s valuation.

[/level-free]
[not-level-free]

Downloadable PDF version of this valuation:

ModernGraham Valuation of IPI – December 2016

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $164,867,313 Fail
2. Sufficiently Strong Financial Condition Current Ratio > 2 3.37 Pass
3. Earnings Stability Positive EPS for 10 years prior Fail
4. Dividend Record Dividend Payments for 10 years prior Fail
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end -411.48% Fail
6. Moderate PEmg Ratio PEmg < 20 -1.06 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 0.42 Fail
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 3.37 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 1.20 Fail
3. Earnings Stability Positive EPS for 5 years prior Fail
4. Dividend Record Currently Pays Dividend Fail
5. Earnings Growth EPSmg greater than 5 years ago Fail

Stage 2: Determination of Intrinsic Value

EPSmg -$1.97
MG Growth Estimate -4.25%
MG Value $0.00
Opinion Overvalued
MG Grade D
MG Value based on 3% Growth -$28.57
MG Value based on 0% Growth -$16.75
Market Implied Growth Rate -4.78%
Current Price $2.08
% of Intrinsic Value N/A

Intrepid Potash, Inc. does not satisfy the requirements of either the Enterprising Investor or the more conservative Defensive Investor. The Defensive Investor is concerned with the small size, insufficient earnings stability or growth over the last ten years, the poor dividend history, and the high PEmg and PB ratios. The Enterprising Investor has concerns regarding the level of debt relative to the net current assets, and the lack of earnings stability or growth over the last five years, and the lack of dividends. As a result, all value investors following the ModernGraham approach should explore other opportunities at this time or proceed cautiously with a speculative attitude.

As for a valuation, the company appears to be Overvalued after seeing its EPSmg (normalized earnings) decline from $1.08 in 2012 to an estimated $-1.97 for 2016. This level of negative earnings does not support a positive valuation.As a result, the ModernGraham valuation model, based on the Benjamin Graham value investing formula, returns an estimate of intrinsic value below the price.

At the time of valuation, further research into Intrepid Potash, Inc. revealed the company was trading above its Graham Number of $0. The company does not pay a dividend. Its PEmg (price over earnings per share – ModernGraham) was -1.06, which was below the industry average of 13.11, which by some methods of valuation makes it one of the most undervalued stocks in its industry. Finally, the company was trading above its Net Current Asset Value (NCAV) of $-0.62.

Intrepid Potash, Inc. scores quite poorly in the ModernGraham grading system, with an overall grade of D.

Stage 3: Information for Further Research

Net Current Asset Value (NCAV) -$0.62
Graham Number $0.00
PEmg -1.06
Current Ratio 3.37
PB Ratio 0.42
Current Dividend $0.00
Dividend Yield 0.00%
Number of Consecutive Years of Dividend Growth 0

[/not-level-free]

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 9/1/2016
Total Current Assets $155,963,000
Total Current Liabilities $46,337,000
Long-Term Debt $132,024,000
Total Assets $581,527,000
Intangible Assets $0
Total Liabilities $202,635,000
Shares Outstanding (Diluted Average) 75,872,000

Earnings Per Share History

Next Fiscal Year Estimate -$0.79
Dec2015 -$6.94
Dec2014 $0.13
Dec2013 $0.30
Dec2012 $1.16
Dec2011 $1.45
Dec2010 $0.60
Dec2009 $0.74
Dec2008 $1.31
Dec2007 $0.39

Earnings Per Share – ModernGraham History

Next Fiscal Year Estimate -$1.97
Dec2015 -$1.97
Dec2014 $0.59
Dec2013 $0.83
Dec2012 $1.08
Dec2011 $0.99
Dec2010 $0.71
Dec2009 $0.67
Dec2008 $0.54
Dec2007 $0.13

Recommended Reading:

Other ModernGraham posts about the company

None.  This is the first time ModernGraham has covered the company.

Other ModernGraham posts about related companies

CF Industries Holdings Inc Valuation – August 2016 $CF
CF Industries Valuation – March 2016 $CF
Monsanto Company Valuation – January 2016 Update $MON
Mosaic Company Valuation – October 2015 Update $MOS
CF Industries Holdings Inc. Analysis – September 2015 Update $CF
Monsanto Company Analysis – September 2015 Update $MON
Mosaic Company Analysis – July 2015 Update $MOS
CF Industries Holdings Analysis – June 2015 Update $CF
Mosaic Inc. Quarterly Valuation – April 2015 $MOS
CF Industries Holdings Inc. Quarterly Valuation – March 2015 $CF

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Ashland Inc Valuation – July 2016 $ASH

Benjamin Graham taught that Intelligent Investors must do a thorough fundamental analysis of investment opportunities to determine their intrinsic value and inherent risk.  This is best done by utilizing a systematic approach to analysis that will provide investors with a sense of how a specific company compares to another company or by reviewing the 10 Companies Benjamin Graham Would Invest In Today – July 2016.  By using the ModernGraham method one can review a company’s historical accomplishments and determine an intrinsic value that can be compared across industries.  What follows is a stock analysis showing a specific look at how Ashland Inc (ASH) fares in the ModernGraham valuation model.

Company Profile (obtained from Google Finance): Ashland Inc. is engaged in specialty chemicals, and through Valvoline, is a consumer-branded lubricant supplier. The Company operates in three segments: Ashland Specialty Ingredients (Specialty Ingredients), Ashland Performance Materials (Performance Materials) and Valvoline. Its Specialty Ingredients segment is engaged in providing cellulose ethers, vinyl pyrrolidones and biofunctionals, and consists of two divisions: Consumer Specialties and Industrial Specialties. Its Performance Materials segment is engaged in providing unsaturated polyester resins and vinyl ester resins, and consists of two divisions: Composites and Intermediates/Solvents. Its Valvoline segment is engaged in producing and distributing automotive, commercial and industrial lubricants, and automotive chemicals. Its chemistry is used in various markets and applications, including architectural coatings, adhesives, automotive, construction, energy and pharmaceutical.

[level-free]

To read the details of this valuation, you must be logged in as a premium member. If you are not a premium member, please consider becoming one.

Premium members can view a full ModernGraham valuation of the company and have access to download a PDF version of the valuation for easy reference. Here is a free sample valuation pdf, and here is a post detailing what can be found within each individual company’s valuation.

[/level-free]
[not-level-free]

Downloadable PDF version of this valuation:

ModernGraham Valuation of ASH – July 2016

Stage 1: Is this company suitable for the Defensive Investor or the Enterprising Investor?

What kind of Intelligent Investor are you?

Defensive Investor; must pass 6 out of the following 7 tests.
1. Adequate Size of the Enterprise Market Cap > $2Bil $7,066,196,693 Pass
2. Sufficiently Strong Financial Condition Current Ratio > 2 1.74 Fail
3. Earnings Stability Positive EPS for 10 years prior Pass
4. Dividend Record Dividend Payments for 10 years prior Pass
5. Earnings Growth Increase of 33% in EPS in past 10 years using 3 year averages at beginning and end 81.78% Pass
6. Moderate PEmg Ratio PEmg < 20 23.55 Fail
7. Moderate Price to Assets PB Ratio < 2.5 OR PB*PEmg < 50 2.62 Fail
Enterprising Investor; must pass 4 out of the following 5 tests, or be suitable for the Defensive Investor.
1. Sufficiently Strong Financial Condition Current Ratio > 1.5 1.74 Pass
2. Sufficiently Strong Financial Condition Debt to NCA < 1.1 2.67 Fail
3. Earnings Stability Positive EPS for 5 years prior Pass
4. Dividend Record Currently Pays Dividend Pass
5. Earnings Growth EPSmg greater than 5 years ago Pass

Stage 2: Determination of Intrinsic Value

ASH value chart July 2016

EPSmg $4.82
MG Growth Estimate 12.53%
MG Value $161.82
Opinion Undervalued
MG Grade C+
MG Value based on 3% Growth $69.93
MG Value based on 0% Growth $40.99
Market Implied Growth Rate 7.52%
Current Price $113.56
% of Intrinsic Value 70.18%

Ashland Inc is suitable for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio, high PEmg and PB ratios. The Enterprising Investor is only concerned with the level of debt relative to the net current assets. As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the analysis.

As for a valuation, the company appears to be Undervalued after growing its EPSmg (normalized earnings) from $2.63 in 2012 to an estimated $4.82 for 2016. This level of demonstrated earnings growth outpaces the market’s implied estimate of 7.52% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham’s formula, returns an estimate of intrinsic value above the price.

Ashland Inc receives an average overall rating in the ModernGraham grading system, scoring a C+.

Stage 3: Information for Further Research

ASH charts July 2016

Net Current Asset Value (NCAV) -$67.73
Graham Number $73.88
PEmg 23.55
Current Ratio 1.74
PB Ratio 2.62
Current Dividend $1.56
Dividend Yield 1.37%
Number of Consecutive Years of Dividend Growth 7

[/not-level-free]

Useful Links:

ModernGraham tagged articles Morningstar
Google Finance MSN Money
Yahoo Finance Seeking Alpha
GuruFocus SEC Filings

Most Recent Balance Sheet Figures

Balance Sheet Information 6/1/2016
Total Current Assets $2,911,000,000
Total Current Liabilities $1,671,000,000
Long-Term Debt $3,316,000,000
Total Assets $9,912,000,000
Intangible Assets $3,653,000,000
Total Liabilities $7,178,000,000
Shares Outstanding (Diluted Average) 63,000,000

Earnings Per Share History

Next Fiscal Year Estimate $5.59
Sep2015 $4.48
Sep2014 $3.00
Sep2013 $8.57
Sep2012 $0.33
Sep2011 $5.17
Sep2010 $4.18
Sep2009 $0.96
Sep2008 $2.63
Sep2007 $3.60
Sep2006 $5.64
Sep2005 $26.85
Sep2004 $5.31
Sep2003 $1.10
Sep2002 $1.67
Sep2001 $5.93
Sep2000 $0.98
Sep1999 $3.89
Sep1998 $2.63
Sep1997 $3.67
Sep1996 $2.82

Earnings Per Share – ModernGraham History

Next Fiscal Year Estimate $4.82
Sep2015 $4.40
Sep2014 $4.32
Sep2013 $4.60
Sep2012 $2.63
Sep2011 $3.62
Sep2010 $3.03
Sep2009 $4.28
Sep2008 $6.90
Sep2007 $8.86
Sep2006 $10.36
Sep2005 $11.20
Sep2004 $3.25
Sep2003 $2.39
Sep2002 $3.03
Sep2001 $3.61
Sep2000 $2.57

Recommended Reading:

Other ModernGraham posts about the company

5 Undervalued Companies for the Defensive Investor Near 52 Week Lows – February 2016
19 Best Stocks For Value Investors This Week – 1/9/16
Ashland Inc Valuation – January 2016 Update $ASH
19 Best Stocks For Value Investors This Week – 8/29/15
Ashland Inc. Analysis – Initial Coverage $ASH

Other ModernGraham posts about related companies

FMC Corporation Valuation – July 2016 $FMC
Eastman Chemical Company Valuation – July 2016 $EMN
Dow Chemical Co Valuation – July 2016 $DOW
Olin Corporation Valuation – June 2016 $OLN
LyondellBasell Industries Valuation – June 2016 $LYB
Praxair Inc Valuation – June 2016 $PX
Albemarle Corp Valuation – February 2016 $ALB
Airgas Inc Stock Valuation – February 2016 $ARG
Air Products & Chemicals Inc Valuation – February 2016 $APD
FMC Corporation Valuation – January 2016 Update $FMC

Disclaimer:

The author did not hold a position in any company mentioned in this article at the time of publication and had no intention of changing that position within the next 72 hours.  See my current holdings here.  This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions.  ModernGraham is not affiliated with the company in any manner.  Please be sure to review our detailed disclaimer.

Back To Top