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Yahoo
24-05-2025
- Business
- Yahoo
CVR Energy, Inc. (NYSE:CVI) Shares Could Be 45% Below Their Intrinsic Value Estimate
Using the 2 Stage Free Cash Flow to Equity, CVR Energy fair value estimate is US$42.35 CVR Energy's US$23.50 share price signals that it might be 45% undervalued Our fair value estimate is 112% higher than CVR Energy's analyst price target of US$20.00 In this article we are going to estimate the intrinsic value of CVR Energy, Inc. (NYSE:CVI) by projecting its future cash flows and then discounting them to today's value. We will use the Discounted Cash Flow (DCF) model on this occasion. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF ($, Millions) US$94.0m US$520.5m US$372.0m US$295.5m US$255.6m US$233.7m US$221.7m US$215.7m US$213.5m US$213.9m Growth Rate Estimate Source Analyst x1 Analyst x2 Analyst x1 Est @ -20.56% Est @ -13.51% Est @ -8.58% Est @ -5.12% Est @ -2.70% Est @ -1.01% Est @ 0.18% Present Value ($, Millions) Discounted @ 7.4% US$87.5 US$451 US$300 US$222 US$179 US$152 US$134 US$122 US$112 US$104 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$1.9b The second stage is also known as Terminal Value, this is the business's cash flow after 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 (2.9%) 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 7.4%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$214m× (1 + 2.9%) ÷ (7.4%– 2.9%) = US$4.9b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$4.9b÷ ( 1 + 7.4%)10= US$2.4b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is US$4.3b. The last step is to then divide the equity value by the number of shares outstanding. Compared to the current share price of US$23.5, the company appears quite undervalued at a 45% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out. Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. 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 CVR Energy 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 7.4%, which is based on a levered beta of 1.037. 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. View our latest analysis for CVR Energy Whilst important, the DCF calculation is only one of many factors that you need to assess for a company. It's not possible to obtain a foolproof valuation with a DCF model. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. Can we work out why the company is trading at a discount to intrinsic value? For CVR Energy, there are three fundamental factors you should consider: Risks: We feel that you should assess the 1 warning sign for CVR Energy we've flagged before making an investment in the company. Future Earnings: How does CVI'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 High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE 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. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
24-05-2025
- Business
- Yahoo
CVR Energy, Inc. (NYSE:CVI) Shares Could Be 45% Below Their Intrinsic Value Estimate
Using the 2 Stage Free Cash Flow to Equity, CVR Energy fair value estimate is US$42.35 CVR Energy's US$23.50 share price signals that it might be 45% undervalued Our fair value estimate is 112% higher than CVR Energy's analyst price target of US$20.00 In this article we are going to estimate the intrinsic value of CVR Energy, Inc. (NYSE:CVI) by projecting its future cash flows and then discounting them to today's value. We will use the Discounted Cash Flow (DCF) model on this occasion. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF ($, Millions) US$94.0m US$520.5m US$372.0m US$295.5m US$255.6m US$233.7m US$221.7m US$215.7m US$213.5m US$213.9m Growth Rate Estimate Source Analyst x1 Analyst x2 Analyst x1 Est @ -20.56% Est @ -13.51% Est @ -8.58% Est @ -5.12% Est @ -2.70% Est @ -1.01% Est @ 0.18% Present Value ($, Millions) Discounted @ 7.4% US$87.5 US$451 US$300 US$222 US$179 US$152 US$134 US$122 US$112 US$104 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = US$1.9b The second stage is also known as Terminal Value, this is the business's cash flow after 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 (2.9%) 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 7.4%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = US$214m× (1 + 2.9%) ÷ (7.4%– 2.9%) = US$4.9b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= US$4.9b÷ ( 1 + 7.4%)10= US$2.4b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is US$4.3b. The last step is to then divide the equity value by the number of shares outstanding. Compared to the current share price of US$23.5, the company appears quite undervalued at a 45% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out. Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. 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 CVR Energy 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 7.4%, which is based on a levered beta of 1.037. 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. View our latest analysis for CVR Energy Whilst important, the DCF calculation is only one of many factors that you need to assess for a company. It's not possible to obtain a foolproof valuation with a DCF model. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. Can we work out why the company is trading at a discount to intrinsic value? For CVR Energy, there are three fundamental factors you should consider: Risks: We feel that you should assess the 1 warning sign for CVR Energy we've flagged before making an investment in the company. Future Earnings: How does CVI'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 High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE 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
Yahoo
22-04-2025
- Business
- Yahoo
CVR Energy, Inc. (CVI): Among the Dividend Paying Stocks Insiders Are Buying
We recently compiled a list of the . In this article, we are going to take a look at where CVR Energy, Inc. (NYSE:CVI) stands against the other dividend paying stocks. Uncertainty is not among the market's favorites. Yet, at present, uncertainty is prevailing throughout the market. The U.S.-China trade escalation and the new tariffs on all other U.S. trading partners have left investors scrambling to find stable ground. READ ALSO: Just this week, CNBC reported President Trump's announcement to charge steep fees on ships built in China, presently docking at the U.S. ports, a move the analysts perceive could cause the shipping costs to go high and send a ripple through consumer prices. China, the significant retaliator to Trump's tariffs, has started targeting the U.S. service sector by threatening everything from tourism to tech talent pipelines. Even the blue-chip stocks find the current climate unfavorable, thus increasing the adoption rate of another strategy: dividend-paying stocks. And here's the kicker – insiders are loading up on them. Dividends are the financial shock absorbers when growth stocks swing wildly on trade war headlines. Investors in such an unfavorable market condition often prioritize the cash flow today rather than the promises of growth tomorrow. Historically, in many instances, when the market is experiencing turbulence, the dividend-paying stocks outperformed their non-dividend peers. In addition to padding the portfolio, the dividend stocks have signaled corporate resilience. And right now, insiders like executives and board members are betting big on the stability of the dividend stocks. Corporate leaders buy shares of their companies to add credibility to the stocks. At the same time, it also indicates that they see an undervalued potential in their stocks. Unlike analysts, the insiders have first-hand information regarding earnings forecasts, balance sheets, and the company's strategies that would allow it to weather the upcoming storms. The recent U.S.-China tariff escalations stand as a prime example of such storms. The headlines focus on the two countries' shipping fees and rare-earth export controls. Meanwhile, board members of some companies are scooping up stocks. But these are not speculative plays; they are calculated decisions made using the unique knowledge of the company's cash flows, debt, and history of raising dividends. Now, let us zoom out. The market position is clear. According to CNBC, volatility has become the new normal with China's retaliation squeezing the services trade sector, where the U.S. holds a $32 billion surplus. Finding an appropriate dividend that could add some resilience to the portfolio becomes a necessity. Using insider backing to find the best stock offers a rare blend of defensive positioning and growth potential. In this regard, we have done the legwork to uncover 10 dividend-paying stocks with high insider confidence. In addition to offering a positive yield, our picks could fortify your investments against the market chaos caused by the trade war. You may be hedging against inflation, chasing reliable income, or simply copying the moves of those in the know. When putting together our top 10 picks for the best dividend-paying stocks investors are buying, we followed a few criteria. We set the dividend yield at a minimum of 3%. This criterion is in place to provide investors with optimal income-generating stocks. We did not include stocks with an insider ownership change of less than 4% in the last six months since a larger percentage correlates with a significant shift in ownership, potentially based on recent and relevant information. Stocks with an average volume of over 200,000 are included in the list, suggesting much trading activity with strong interest from buyers and sellers. Additionally, we have considered only those stocks with a positive return on equity (ROE). With this criterion, we ensured that our picks generated income for the investments made by the shareholders. All the data in the article was taken from financial databases and analyst reports, with all information updated as of April 16, 2025. And we have ranked our picks based on the percentage change in insider ownership. A tanker filled with crude oil slowly unloading its cargo onto a container ship. CVR Energy, Inc. (NYSE:CVI) operates petroleum refining and nitrogen fertilizer businesses through its subsidiaries. Operating from its Texas headquarters, the company supplies fuels and agricultural products to U.S. Midwest and Gulf Coast markets. While players like Valero and CF Industries threaten market share, CVR Energy, Inc. (NYSE:CVI)'s integrated operations and strategic asset location help it thrive in the industry. The diversification across energy and agriculture, alongside cost-efficient refining infrastructure, further ensures optimal performance even during commodity price swings. The fertilizer and renewable segments contributed to the company's consolidated net income of $45 million and an EBITDA of $394 million for the full year of 2024. The increase in ammonia sales prices and the reduced feedstock cost enabled the company to achieve an adjusted EBITDA of $50 million in the fertilizer segment in Q4. The renewable segment generated an adjusted EBITDA of $9 million during the same period, significantly improving from the previous year's quarter. For 2025, CVR Energy, Inc. (NYSE:CVI) anticipates an increased demand and supply rationalization to drive up its sales and net income. CVR Energy, Inc. (NYSE:CVI) saw a 5.18% increase in insider ownership in the last six months, which attracted investor interest. A dividend yield of 5.44% marks the stock as a significant contender for investors looking for the best dividend stocks with a high return and capital appreciation capabilities. Overall CVI ranks 8th on our list of the dividend paying stocks insiders are buying. While we acknowledge the potential of CVI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CVI but trades at less than 5 times its earnings, check out our report about this . READ NEXT: and . Disclosure: None. This article is originally published at .
Associated Press
15-04-2025
- Business
- Associated Press
CVR Energy to Release First Quarter 2025 Earnings Results
SUGAR LAND, Texas, April 15, 2025 (GLOBE NEWSWIRE) -- CVR Energy, Inc. (NYSE: CVI) plans to release its first quarter 2025 earnings results on Monday, April 28, after the close of trading on the New York Stock Exchange. The Company also will host a teleconference call on Tuesday, April 29, at 1 p.m. Eastern to discuss these results. This call, which will contain forward-looking information, will be webcast live and can be accessed on the Investor Relations section of CVR Energy's website at For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8291. The webcast will be archived and available for 14 days at A repeat of the call also can be accessed for 14 days by dialing (877) 660-6853, conference ID 13752979. CVR Energy's first quarter 2025 earnings news release will be distributed via GlobeNewswire and posted at About CVR Energy, Inc. Headquartered in Sugar Land, Texas, CVR Energy is a diversified holding company primarily engaged in the renewables, petroleum refining and marketing businesses as well as in the nitrogen fertilizer manufacturing business through its interest in CVR Partners, LP. CVR Energy subsidiaries serve as the general partner and own 37 percent of the common units of CVR Partners, LP. For further information, please contact: Investor Relations: Richard Roberts CVR Energy, Inc. (281) 207-3205 [email protected] Media Relations: Brandee Stephens CVR Energy, Inc. (281) 207-3516 [email protected]
Yahoo
09-04-2025
- Business
- Yahoo
CVR Energy, Inc. (CVI): Among Stocks Insiders Bought in April After Trump's Tariff Rollout
We recently published a list of . In this article, we are going to take a look at where CVR Energy, Inc. (NYSE:CVI) stands against other stocks that insiders bought in April after Trump's tariff rollout. President Donald Trump called April 2 a 'Liberation Day' after signing an executive order that imposed a minimum 10% tariff on all U.S. imports, with some exceptions. As a result, 57 countries will face higher tariffs ranging from 11% to 50%. While general tariffs took effect on April 5, the elevated rates are set to begin on April 9. These so-called 'reciprocal tariffs' triggered retaliation from trade partners and contributed to a decline in the stock market.' On Sunday, Trump said, 'I don't want anything to go down, but sometimes you have to take medicine to fix something,' as reported by CNBC. The blue-chip companies closed the Monday market session 0.91% lower, while the broader market index closed 0.23% lower after briefly entering bear market territory during the session. The Nasdaq Composite closed 0.10% higher. Amid these tariff wars and overwhelming market uncertainty, insider trading often comes to focus. Why? When executives buy stock, it can suggest confidence in the company's future. On the other hand, insider sales don't have to be a negative sign for the company, because they can reflect personal decisions or investment diversification. This means that insider trading should be considered alongside the company's financial health and market conditions. Today, we're focusing on stocks that insiders have been buying in April. Using Insider Monkey's insider trading screener, we identified companies where at least one insider acquired shares from April 2 to April 7. From this list, we ranked the top 20 stocks with the highest value of insider purchases. Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A tanker filled with crude oil slowly unloading its cargo onto a container ship. CVR Energy is a diversified holding company with a primary focus on renewable fuels, petroleum refining, marketing, and nitrogen fertilizer production through its subsidiary, CVR Partners, LP. The company is also a key holding for billionaire hedge fund manager Carl Icahn. This month, billionaire Carl Icahn increased his stake in CVR Energy by buying $9.47 million worth of CVR Energy shares at an average price of $16.93 per share. The stock now trades at $16.35, having lost 12.75% since the beginning of the year. Over the past 12 months, the stock lost 54.98%. For 2024, CVR Energy reported revenue of $7.61 billion, a 17.7% decline from $9.25 billion in 2023. Net income for shareholders was $7 million, or 6 cents per diluted share, down from $769 million, or $7.65 per share, in the prior year. The adjusted loss was 51 cents per diluted share, compared to adjusted earnings of $5.64 per share in 2023. According to MarketBeat, five analysts rate CVR Energy stock as a 'Moderate Sell' with a price target of $21.25 per share. The average price target suggests a 29.97% upside from the latest price. Overall, CVI ranks 5th on our list of stocks that insiders bought in April after Trump's tariff rollout. While we acknowledge the potential of CVI, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CVI but that trades at less than 5 times its earnings, check out our report about this . READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
