Latest news with #ALFEN
Yahoo
22-03-2025
- Business
- Yahoo
Is Alfen N.V. (AMS:ALFEN) Trading At A 28% Discount?
Using the 2 Stage Free Cash Flow to Equity, Alfen fair value estimate is €19.28 Alfen is estimated to be 28% undervalued based on current share price of €13.86 The €16.35 analyst price target for ALFEN is 15% less than our estimate of fair value Today we will run through one way of estimating the intrinsic value of Alfen N.V. (AMS:ALFEN) by estimating the company's future cash flows and discounting them to their present value. This will be done using the Discounted Cash Flow (DCF) model. Models like these may appear beyond the comprehension of a lay person, but they're fairly easy to follow. Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. For those who are keen learners of equity analysis, the Simply Wall St analysis model here may be something of interest to you. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (€, Millions) €1.67m €7.98m €18.1m €10.4m €19.7m €22.5m €24.8m €26.6m €28.2m €29.4m Growth Rate Estimate Source Analyst x3 Analyst x5 Analyst x4 Analyst x2 Analyst x2 Est @ 14.05% Est @ 10.23% Est @ 7.56% Est @ 5.69% Est @ 4.38% Present Value (€, Millions) Discounted @ 6.6% €1.6 €7.0 €14.9 €8.0 €14.3 €15.3 €15.8 €15.9 €15.8 €15.5 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = €124m After calculating the present value of future cash flows in the initial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (1.3%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 6.6%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = €29m× (1 + 1.3%) ÷ (6.6%– 1.3%) = €561m Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €561m÷ ( 1 + 6.6%)10= €295m The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is €419m. In the final step we divide the equity value by the number of shares outstanding. Relative to the current share price of €13.9, the company appears a touch undervalued at a 28% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Alfen as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 6.6%, which is based on a levered beta of 1.227. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. See our latest analysis for Alfen Although the valuation of a company is important, it ideally won't be the sole piece of analysis you scrutinize for a company. It's not possible to obtain a foolproof valuation with a DCF model. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. Can we work out why the company is trading at a discount to intrinsic value? For Alfen, we've compiled three pertinent items you should assess: Risks: Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Alfen , and understanding it should be part of your investment process. Future Earnings: How does ALFEN's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the ENXTAM every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Arab Times
24-02-2025
- Business
- Arab Times
Kuwait opens second phase of waterfront project just in time for National Day celebrations
KUWAIT CITY, Feb 24: The Tourism Enterprises Company has announced the opening of the second phase of the waterfront beautification project, coinciding with the State of Kuwait's celebrations of National Days. The second phase spans 5 kilometers, starting from Green Island to the Yacht Club in Salmiya. The official ceremony was sponsored by the Governor of the Capital, Sheikh Abdullah Salem Al-Ali, and attended by Hamoud Al-Falah, Vice Chairman of the Board of Directors of the Tourism Enterprises Company, along with Acting CEO Abdullah Al-Jaafar. Representatives from the Tourism Enterprises Company, investing companies along the waterfront, and the media were also present. The waterfront is one of Kuwait's most prominent tourist and entertainment destinations, divided into two phases. The first phase extends from the Kuwait Towers to Green Island and opened in February 2024, while the second phase runs from Green Island to the Grand Mosque. Thanks to its strategic location along Arabian Gulf Street, the waterfront offers a variety of facilities and services to meet the needs of all members of society. These include public beaches, children's play areas, and fully-equipped sports facilities. Additionally, the area features a wide range of restaurants and cafes, which enhance the visitor experience and add a unique charm to the site. The project also includes 12.4 kilometers of jogging tracks and a dedicated 15.4-kilometer bicycle path along the waterfront. The company has prioritized sustainability, replacing traditional lighting poles with solar-powered ones and adding 40 electric car charging stations from the Dutch brand ALFEN, strategically placed throughout the project. Furthermore, 4,000 parking spaces have been renovated to improve accessibility and provide a more comfortable experience for all visitors. In addition to the waterfront's recreational spaces, the Tourism Enterprises Company has rehabilitated the beaches to serve as multi-use venues for events year-round. The company has also worked on restoring the natural landscape by removing harmful Conacarpus trees and replacing them with new trees and plants suited to Kuwait's climate. The company has added artistic elements to the waterfront, including artwork reflecting Kuwait's culture and ecosystem. New benches, columns, barriers, and signboards have been installed throughout the area. The project also features models of ships inspired by Japanese origami, designed in the shape of Kuwaiti currency, as well as displays of the name "Kuwait" in both Arabic and English. Hamoud Al-Falah, Vice Chairman of the Tourism Enterprises Company, emphasized that the opening of the second phase of the waterfront project demonstrates the company's commitment to developing tourism and entertainment facilities that align with the aspirations of citizens, residents, and visitors. He noted that the project supports Kuwait's position as a distinguished tourist destination by developing integrated, modern facilities that cater to all needs, in line with Kuwait Vision 2035. Al-Falah added that the project helps stimulate the local economy by attracting more visitors, revitalizing the hospitality and services sectors, and offering promising investment opportunities for both local and international institutions. 'This project marks a significant addition to Kuwait's tourism landscape,' Al-Falah said. 'We designed the second phase with sustainability and quality in mind, ensuring that environmental elements and clean energy were incorporated at every stage. Modern technologies have also been utilized for managing the infrastructure and facilities.' Al-Falah highlighted that the waterfront is not just a tourist attraction but a vital community space that meets the needs of diverse groups, including families, youth, and athletes. He emphasized that the company's ongoing development of future projects contributes to enhancing the quality of life in Kuwait. Al-Falah affirmed that the Tourism Enterprises Company will continue to work on developing tourism and entertainment destinations in the country, with a strong focus on innovation and sustainability to offer exceptional experiences for visitors.
