Newmont Corporation : Overview of business and Intrinsic value of shares

 

Overview of Newmont Corporation & Intrinsic Value calculation using Dividend Discount Model (DDM)

Newmont Corporation https://www.newmont.com/investors/reports-and-filings/default.aspx Newmont is the world s leading gold company and a producer of copper, silver, zinc and lead. Newmont owned more than half of the world s Tier 1 gold mines. The Company s world-class portfolio of assets, prospects and talent is anchored in favorable mining jurisdictions in Africa, Australia, Latin America & Caribbean, North America, and Papua New Guinea. Newmont is the only gold producer listed in the S&P 500 Index and is widely recognized for its principled environmental, social, and governance practices. The Company is an industry leader in value creation, supported by robust safety standards, superior execution and technical expertise. Newmont was founded in 1921 and has been publicly traded since 1925.

DDM Details of Newmont Corporation shown below, US$ in millions, except per share data

Year	Value	Dividend per share or Terminal Value	Present Value at 9.17%
0	DPS0	1.22	1.22
1	DPS1	1.23	1.12
2	DPS2	1.31	1.04
3	DPS3	1.37	1.01
4	DPS4	1.44	0.963
5	DPS5	1.53	0.931
5	Terminal Value (TV5)	51.5	32.88

Intrinsic value of Newmont Corporation	$39.12
Market cap of Newmont Corporation	$54.41 Billion
Intrinsic value of Newmont Corporation common stock (per share)	$39.12
Current share price on 10/31/2024	$48.36

 

Required rate of Return

Assumptions

Rate of return on LT Treasury Composite(Rf)	4.36%
Expected rate of return on market portfolio(E(RM)	13.81%
Systematic risk of Newmont Corporation. Common stock (β)	0.51
Required rate of return on Newmont Corporation Common Stock (r) Calculation : Rf + β(E(RM)- (Rf) = 4.36% +0.51[13.81% - 4.36%]	9.17%

 

 

 

 

 

Dividend Growth rate Forecast

Newmont Corporation. H-Model

Year	Value	Growth Rate
1	g1 (PRAT Model)	1.12%
2	g2 (Linear Interpolation)	2.65%
3	g3 (Linear Interpolation)	4.1%
4	g4 (Linear Interpolation)	5.5%
5	g5 (Single stage model)	6%

 

2023 Calculations

Dividend yield	2.54%
Profit margin	-21.11%
Asset turnover	0.21
Financial Leverage	2.11
EPS	-2.17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sources : Form 10K of Newmont Corporation Incorporated for the fiscal year 2023, https://www.newmont.com/about-us/default.aspx, https://www.stock-analysis-on.net/ , https://finance.yahoo.com/ , https://companiesmarketcap.com/

 

Mastercard Incorporated -Overview of Business and Intrinsic Value of Shares

 

Overview of Mastercard Incorporated & Intrinsic Value calculation

Mastercard https://www.mastercard.com/global/en/personal/find-card-products/click-to-pay.html is a technology company in the global payments industry. Mastercard connect consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide by enabling electronic payments and making those payment transactions safe, simple, smart and accessible. Mastercard make payments easier and more efficient by providing a wide range of payment solutions and services using of well-known and trusted brands, including Mastercard , Maestro and Cirrus . Mastercard handling additional payments capabilities that include automated clearing house ( ACH ) transactions (both batch and real-time account-based payments).

 

FCFE Details of Mastercard Incorporated shown below, US$ in millions, except per share data

Year	Value	FCFE or Terminal Value	Present Value at 14.7%
0	FCFE0	13,639	13,639
1	FCFE1	14,798	11,891
2	FCFE2	16,498	11,248
3	FCFE3	18,148	10,933
4	FCFE4	20,097	10,485
5	FCFE5	22,406	10,123
5	Terminal Value (TV5)	778,207	391,992

Intrinsic value of Mastercard Incorporated	$460,313
Market cap of Mastercard Incorporated	$474.60 Billion
Intrinsic value of Mastercard Incorporated common stock (per share)	$493.37
Current share price on 10/23/2024	$513.73

 

Required rate of Return

Assumptions

Rate of return on LT Treasury Composite(Rf)	4.36%
Expected rate of return on market portfolio(E(RM)	13.81%
Systematic risk of Mastercard Incorporated. Common stock (β)	1.1
Required rate of return on Mastercard Incorporated Common Stock (r) Calculation : Rf + β(E(RM)- (Rf) = 4.36% +1.1[13.81% - 4.36%]	14.7%

 

FCFE Growth rate Forecast

Mastercard Incorporated. H-Model

Year	Value	Growth Rate
1	g1 (PRAT Model)	8.5%
2	g2 (Linear Interpolation)	9.24%
3	g3 (Linear Interpolation)	10%
4	g4 (Linear Interpolation)	10.74%
5	g5 (Single stage model)	11.49%

 

2023 Calculations

Retention rate	80.72%
Dividend yield	4.50%
Gross Profit Margin	55.81%
Profit margin	44.60%
Asset turnover	0.59
EPS	11.9
PE Ratio	46.5

 

 

 

 

 

 

 

 

 

Sources : Form 10K of Mastercard Incorporated for the fiscal year 2023, https://www.mastercard.com/global/en.html, https://www.stock-analysis-on.net/ , https://finance.yahoo.com/ , https://companiesmarketcap.com/

 

Motorola Solutions, INC - Overview and Intrinsic Valuation of shares

 

Overview of Motorola Solutions, INC & Intrinsic Value calculation

Motorola Solutions, INC build and connect technologies to help protect people, property and places , enabling critical collaboration between public safety agencies and enterprises for a proactive approach to safety and security. https://www.motorolasolutions.com/en_xp/about.html is global leader in public safety and enterprise security , grounded in nearly 100 years of close customer and community collaboration.

Motorola Solutions, INC manage business through two segments Products and Systems Integration and Software and Services.

Net sales increased by $866 Million, or 10% compared to 2022. Gross profit margin was 49.8% of net sales in 2023 compared to 46.4% of net sales in 2022.

 

FCFE Details of Motorola Solutions, INC. shown below, US$ in millions, except per share data

Year	Value	FCFE or Terminal Value	Present Value at 13.62%
0	FCFE0	2,146	2,146
1	FCFE1	2,382	1,933
2	FCFE2	2,641	1,937
3	FCFE3	2,927	1,942
4	FCFE4	3,241	1,948
5	FCFE5	3,585	1,956
5	Terminal Value (TV5)	121,174	73,121

Intrinsic value of Motorola Solutions, INC	$84,983
Market cap of Motorola Solutions, INC	$79.59 Billion
Intrinsic value of Motorola Solutions, INC common stock (per share)	$509.19
Current share price on 10/21/2024	$477.10

 

Required rate of Return

Assumptions

Rate of return on LT Treasury Composite(Rf)	4.36%
Expected rate of return on market portfolio(E(RM)	13.81%
Systematic risk of Motorola Solutions, INC. Common stock (β)	0.598
Required rate of return on Intuit Inc. Common Stock (r) Calculation : Rf + β(E(RM)- (Rf) = 4.36% +0.52[13.81% - 4.36%]	13.62%

 

FCFE Growth rate Forecast

Motorola Solutions, INC. H-Model

Year	Value	Growth Rate
1	g1 (PRAT Model)	11%
2	g2 (Linear Interpolation)	10.9%
3	g3 (Linear Interpolation)	10.81%
4	g4 (Linear Interpolation)	10.72%
5	g5 (Single stage model)	10.63%

 

2023 Calculations

Retention rate	65.63%
Gross Profit Margin	49.8%
Profit margin	17.77%
Asset turnover	0.74
EPS	10.26
PE Ratio	46.5

 

 

 

 

 

 

 

 

 

Sources : Form 10K of Motorola Solutions, INC for the fiscal year 2024, https://www.motorolasolutions.com/investors/earnings-and-sec-filings.html, https://www.stock-analysis-on.net/ , https://finance.yahoo.com/ , https://companiesmarketcap.com/

 

Walmart Inc. Overview of Walmart Inc. and Intrinsic Value Calculation

 

Overview of Walmart Inc & Intrinsic value calculation

Walmart Inc is a people led technology powered omni channel retailer dedicated to helping people around the world save money and live better, by providing the opportunity to shop in both retail stores and through e-commerce. Each week Walmart serve approximately 255 million customers who visit more than 10500 stores and numerous ecommerce websites in 19 countries.

Everyday low price(EDLP) is the cornerstone of Walmart strategy. From grocery and entertainment to sporting goods and crafts Walmart provide deep assortment that its customers appreciate. whether they're shopping online at Walmart.com, through one of Walmart mobile apps or shopping in a store. 

During the year 2024 Walmart Inc reported total revenues of $648 billion and net income generated of $16 billion. Walmart Inc. common stock trades on the New York Stock exchange under the symbol WMT .

FCFE Details of Walmart Inc. shown below, US$ in millions, except per share data

Year	Value	FCFE or Terminal Value	Present Value at 9.3%
0	FCFE0	21,848	21,848
1	FCFE1	24,478	19,500
2	FCFE2	27,036	20,066
3	FCFE3	29,440	20,940
4	FCFE4	31,584	22,222
5	FCFE5	33,398	20,632
5	Terminal Value (TV5)	992,283	149,213

Intrinsic value of Walmart INC	$761,322
Market cap of Walmart INC	$653.323 Billion
Intrinsic value of Walmart INC common stock (per share)	$94.64
Current share price on 10/15/2024	$81.59

 

Required rate of Return

Assumptions

Rate of return on LT Treasury Composite(Rf)	4.36%
Expected rate of return on market portfolio(E(RM)	13.81%
Systematic risk of Walmart Inc. Common stock (β)	0.52
Required rate of return on Intuit Inc. Common Stock (r) Calculation : Rf + β(E(RM)- (Rf) = 4.36% +0.52[13.81% - 4.36%]	9.27%

 

FCFE Growth rate (G) Forecast

Walmart INC. H-Model

Year	Value	g
1	g1 (PRAT Model)	12.04%
2	g2 (Linear Interpolation)	10.45%
3	g3 (Linear Interpolation)	8.9%
4	g4 (Linear Interpolation)	7.28%
5	g5 (Single stage model)	5.74%

 

2023 Calculations

Retention rate	62.26%
Gross Profit Margin	24.37%
Profit margin	2.5%
Asset turnover	2.57%
Financial leverage	3
Return on Invested Capital	13.72%
EPS	1.92
PE Ratio	42.53

 

 

 

 

 

 

 

 

 

Sources : Form 10K of Walmart INC for the fiscal year 2024, https://corporate.walmart.com/ https://stock.walmart.com/financials/annual-reports/default.aspx, https://www.stock-analysis-on.net/ , https://finance.yahoo.com/ , https://companiesmarketcap.com/