Latest news with #DomanBuildingMaterialsGroupLtd
Yahoo
27-05-2025
- Business
- Yahoo
Is Doman Building Materials Group Ltd. (TSE:DBM) Trading At A 36% Discount?
Doman Building Materials Group's estimated fair value is CA$13.10 based on 2 Stage Free Cash Flow to Equity Doman Building Materials Group is estimated to be 36% undervalued based on current share price of CA$8.32 The CA$9.71 analyst price target for DBM is 26% less than our estimate of fair value How far off is Doman Building Materials Group Ltd. (TSE:DBM) from its intrinsic value? Using the most recent financial data, we'll take a look at whether the stock is fairly priced by taking the expected future cash flows and discounting them to their present value. We will use the Discounted Cash Flow (DCF) model on this occasion. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (CA$, Millions) CA$106.2m CA$104.9m CA$104.8m CA$105.5m CA$106.8m CA$108.5m CA$110.5m CA$112.8m CA$115.3m CA$117.9m Growth Rate Estimate Source Analyst x5 Analyst x5 Est @ -0.08% Est @ 0.69% Est @ 1.23% Est @ 1.61% Est @ 1.87% Est @ 2.06% Est @ 2.19% Est @ 2.28% Present Value (CA$, Millions) Discounted @ 11% CA$95.7 CA$85.2 CA$76.7 CA$69.7 CA$63.6 CA$58.2 CA$53.5 CA$49.2 CA$45.3 CA$41.8 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = CA$639m 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 (2.5%) 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 11%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = CA$118m× (1 + 2.5%) ÷ (11%– 2.5%) = CA$1.4b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= CA$1.4b÷ ( 1 + 11%)10= CA$507m The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is CA$1.1b. To get the intrinsic value per share, we divide this by the total number of shares outstanding. Compared to the current share price of CA$8.3, the company appears quite good value at a 36% 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. If you don't agree with these result, have a go at the calculation yourself and play with the 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 Doman Building Materials Group 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 11%, which is based on a levered beta of 1.951. 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. Check out our latest analysis for Doman Building Materials Group Strength Dividends are covered by earnings and cash flows. Dividend is in the top 25% of dividend payers in the market. Weakness Earnings declined over the past year. Interest payments on debt are not well covered. Opportunity Annual earnings are forecast to grow faster than the Canadian market. Good value based on P/E ratio and estimated fair value. Significant insider buying over the past 3 months. Threat Debt is not well covered by operating cash flow. Revenue is forecast to grow slower than 20% per year. Although the valuation of a company is important, it shouldn't be the only metric you look at when researching a company. DCF models are not the be-all and end-all of investment valuation. 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. What is the reason for the share price sitting below the intrinsic value? For Doman Building Materials Group, there are three further factors you should consider: Risks: Every company has them, and we've spotted 2 warning signs for Doman Building Materials Group (of which 1 doesn't sit too well with us!) you should know about. Management:Have insiders been ramping up their shares to take advantage of the market's sentiment for DBM's future outlook? Check out our management and board analysis with insights on CEO compensation and governance factors. 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 TSX 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 in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Hamilton Spectator
09-05-2025
- Business
- Hamilton Spectator
Doman Building Materials Group Ltd. Announces Meeting Results for Election of Directors
THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES. VANCOUVER, , May 09, 2025 (GLOBE NEWSWIRE) — Doman Building Materials Group Ltd. ('Doman' or the 'Company') (TSX:DBM) announced its director election results following its annual and special meeting of shareholders, held May 8, 2025. All of the nominees proposed as directors in the Company's Management Information Circular, dated March 28, 2025, were elected on a vote by show of hands. In total 30,991,740 shares were represented in person or by proxy at the meeting, representing approximately 35.46% of the outstanding shares as of the record date of March 17, 2025. The proxies received by management for the election of directors were as follows: All other matters voted upon at the meeting were approved. The formal report on voting results with respect to all matters voted upon during the annual and special meeting of shareholders will be filed with the regulatory authorities shortly. About Doman Building Materials Group Ltd. Founded in 1989, Doman is headquartered in Vancouver, British Columbia, and trades on the Toronto Stock Exchange under the symbol DBM. As Canada's only fully integrated national distributor in the building materials and related products sector, Doman operates several distinct divisions with multiple treating plants, planing and specialty facilities and distribution centres coast-to-coast in all major cities across Canada and coast-to-coast across the United States. Strategically located across Canada, Doman Building Materials Canada operates distribution centres coast-to-coast, and Doman Treated Wood Canada operates multiple treating plants near major cities. In the United States: headquartered in Dallas, Texas, Doman Lumber operates 21 treating plants, two specialty planing mills and five specialty sawmills located in nine states, distributing, producing and treating lumber, fencing and building material servicing the central U.S.; Doman Tucker Lumber operates three treating plants, specialty sawmilling operations and a captive trucking fleet serving the U.S. east coast; Doman Building Materials USA and Doman Treated Wood USA serve the U.S. west coast with multiple locations in California and Oregon; and in the state of Hawaii the Honsador Building Products Group services 15 locations across all the islands. The Company's Canadian operations also include ownership and management of private timberlands and forest licenses, and agricultural post-peeling and pressure treating through its Doman Timber operations. For additional information on Doman Building Materials Group Ltd., please refer to the Company's filings on SEDAR+ and the Company's website For further information regarding Doman please contact: Ali Mahdavi Investor Relations 416-962-3300
Yahoo
30-01-2025
- Business
- Yahoo
Doman Building Materials Group Ltd. to Issue Fourth Quarter and Full Year 2024 Financial Results February 27, 2025
THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES. VANCOUVER, British Columbia, Jan. 30, 2025 (GLOBE NEWSWIRE) -- Doman Building Materials Group Ltd. ('Doman' or 'the Company') (TSX: DBM) is pleased to announce that it will report its fourth quarter and full year 2024 financial results for the period ended December 31, 2024, after market hours on Thursday, February 27, 2025. The Company will host an analyst call on Friday, February 28, 2025, at 11:00 a.m. ET. Amar Doman, Chairman of the Board and Chief Executive Officer, and James Code, Chief Financial Officer, will discuss the Company's financial performance for the period ended December 31, 2024. To access the call, please dial 1-877-407-3982 or 1-201-493-6780. To join the conference call without operator assistance, you may register and enter your phone number at to receive an instant automated call back. A replay of the conference call will be available from 3:30 p.m. ET, February 28, 2025, until 11:59 p.m. ET, March 14, 2025. To access the replay, dial 1-844-512-2921 or 1-412-317-6671, followed by passcode 13751270. About Doman Building Materials Group Ltd. Founded in 1989, Doman is headquartered in Vancouver, British Columbia, and trades on the Toronto Stock Exchange under the symbol DBM. As Canada's only fully integrated national distributor in the building materials and related products sector, Doman operates several distinct divisions with multiple treating plants, planing and specialty facilities and distribution centres coast-to-coast in all major cities across Canada and coast-to-coast across the United States. Strategically located across Canada, Doman Building Materials Canada operates distribution centres coast-to-coast, and Doman Treated Wood Canada operates multiple treating plants near major cities. In the United States: headquartered in Dallas, Texas, Doman Lumber operates 21 treating plants, two specialty planing mills and five specialty sawmills located in nine states, distributing, producing and treating lumber, fencing and building material servicing the central U.S.; Doman Tucker Lumber operates three treating plants, specialty sawmilling operations and a captive trucking fleet serving the U.S. east coast; Doman Building Materials USA and Doman Treated Wood USA serve the U.S. west coast with multiple locations in California and Oregon; and in the state of Hawaii the Honsador Building Products Group services 15 locations across all the islands. The Company's Canadian operations also include ownership and management of private timberlands and forest licenses, and agricultural post-peeling and pressure treating through its Doman Timber operations. For additional information on Doman Building Materials Group Ltd., please refer to the Company's filings on SEDAR+ and the Company's website For further information regarding Doman please contact: Ali MahdaviInvestor Relations416-962-3300 in to access your portfolio
