Latest news with #VentureCorporation
Yahoo
01-06-2025
- Business
- Yahoo
Estimating The Intrinsic Value Of Venture Corporation Limited (SGX:V03)
The projected fair value for Venture is S$12.31 based on 2 Stage Free Cash Flow to Equity Venture's S$11.07 share price indicates it is trading at similar levels as its fair value estimate Our fair value estimate is 1.7% higher than Venture's analyst price target of S$12.11 Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Venture Corporation Limited (SGX:V03) as an investment opportunity by taking the forecast future cash flows of the company and discounting them back to today's value. This will be done using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple! 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. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. 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. To start off with, we need to estimate the next ten years of cash flows. 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 (SGD, Millions) S$282.3m S$191.8m S$261.2m S$221.8m S$199.9m S$187.5m S$180.7m S$177.4m S$176.4m S$177.0m Growth Rate Estimate Source Analyst x2 Analyst x2 Analyst x3 Est @ -15.09% Est @ -9.85% Est @ -6.19% Est @ -3.62% Est @ -1.83% Est @ -0.57% Est @ 0.31% Present Value (SGD, Millions) Discounted @ 6.9% S$264 S$168 S$214 S$170 S$143 S$126 S$113 S$104 S$96.8 S$90.9 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = S$1.5b 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. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.4%. We discount the terminal cash flows to today's value at a cost of equity of 6.9%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = S$177m× (1 + 2.4%) ÷ (6.9%– 2.4%) = S$4.0b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= S$4.0b÷ ( 1 + 6.9%)10= S$2.1b The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is S$3.5b. In the final step we divide the equity value by the number of shares outstanding. Compared to the current share price of S$11.1, the company appears about fair value at a 10% 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. 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 Venture 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 6.9%, which is based on a levered beta of 1.047. 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 Venture Strength Currently debt free. 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. Opportunity Annual earnings are forecast to grow for the next 3 years. Current share price is below our estimate of fair value. Threat Annual earnings are forecast to grow slower than the Singaporean market. Although the valuation of a company is important, it is only one of many factors that you need to assess for 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. For Venture, there are three essential elements you should look at: Risks: Take risks, for example - Venture has 1 warning sign we think you should be aware of. Future Earnings: How does V03'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. Simply Wall St updates its DCF calculation for every Singaporean stock every day, so if you want to find the intrinsic value of any other stock 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.
Yahoo
22-05-2025
- Business
- Yahoo
Intersection painting splits council
May 21—The vote was 5-3 at Monday's City Council meeting when the administration recommended paying Venture Corporation $59,312 to pave the lines at eight intersections on 10th St. Assistant City Engineer Hitha Kadiyala said the contract will save time and money because the project is being added to other work Venture is doing. The City Connecting Link Improvement Program (CCLIP) offers federal and state funds to cities for enhancing certain roads projects. The City has a CCLIP project starting on Tuesday, May 27, that includes pavement markings at 10th and Patton and Second and Main. Since Road Safe is already the sub-contractor through Venture Corporation for this work, the City requested a quote from them for additional pavement markings at other 10th Street intersections. Funding will come from the street repair budget. Councilmembers raised several questions before voting to approve the recommendation. Councilman Cory Urban asked if there was a guarantee that the paint would last for a year or two, since City Administrator Logan Burns said, "The paint we have is not lasting." To answer Urban's question, there is no warranty. "We've tried three or four different manufacturers of paint and whatever Road Safe has," Burns said. "It seems to stick a little better, but it seems like a week or two after we put that down, it's already gone." He later singled out the intersection of 10th and Washington, where the paint lasted "two weeks, maybe." Councilman Gary Parr asked if the City has explored what is used on Interstate highways and Mayor Cody Schmidt asked if Great Bend has called other cities to see what paint they use. "Our traffic-control specialists are working on it," Kadiyala said. "We've changed the vendors, we changed the methods, and tried every approach." She said they have spent about a year trying to figure out a solution. Kadiyala said Road Safe has to use state-certified paint for CCLIP projects. "We have that paint as well. ... The materials have changed so much lately that we're just trying to figure out what is going on at this point." However, doing nothing is not a good option, she said. She recommended doing the work now for safety and working on researching the paint issue as well. "It blows me away to pay if we can do it ourselves in-house," Urban said. The city will be painting other intersections this year. Those voting "yes" to the painting contract were Kevyn Soupiset, Rickee Maddox, Alan Moeder, Jolene Biggs and Tina Mingenback. Those voting "no" were Urban, Parr and Davis Jimenez. Councilman Parr contacted the Great Bend Tribune on Tuesday to comment on his vote. "I'm not against painting the intersections," he said. "They absolutely need to be painted." Parr said his "no" vote was based on the cost of the paint and the fact that it might only last two to three weeks. "This is almost $7,000 per intersection," he said. He was also concerned that there is no guarantee. "We're just throwing caution to the wind," he said, adding the city needs to check with other cities and get more data. The intersections that are getting pavement markings are all on 10th St. They are located at Frey Street, Kansas Ave., Main, Washington, Harrison, Grant, Patton Road, and K-96. Markings include crosswalks, stop bars, single white lines, turn arrows and double yellow lines.
Yahoo
14-04-2025
- Business
- Yahoo
4 Singapore Blue-Chip Stocks Plunging to Their 52-Week Lows: Are They a Steal?
Trump's tariffs have led to a global stock market rout as countries and companies scrambled to adjust to the new taxes. Although the US President has announced a 90-day pause on all reciprocal tariffs, the baseline 10% tariff still applies and China's tariff was ratcheted up to 125%. The prospect of a bruising trade war caused the Straits Times Index (SGX: ^STI) to register its worst one-day plunge since the pandemic. With many blue-chip stocks plunging to their 52-week lows, could they be an attractive buying opportunity? Here are four that you may consider adding to your buy watchlist. Keppel is a global asset manager that provides sustainability-related solutions spanning the infrastructure, real estate, and connectivity segments. The group operates in more than 20 countries around the world. Shares of the asset manager fell 17.6% year-to-date (YTD) and hit their 52-week low of S$5.61 recently. For 2024, Keppel reported a mixed set of earnings with revenue dipping 5% year on year to S$6.6 billion. Net profit plunged 77% year on year to S$940 million but this was because of an exceptional gain of S$3.2 billion recognised in 2023. Net profit excluding exceptional items and legacy assets rose 5% year on year to S$1.06 billion. The group proposed a final dividend of S$0.19, taking 2024's total dividend to S$0.34, unchanged from a year ago. Keppel is advancing on its Vision 2030 strategic plan, with cumulative asset monetisation close to S$7 billion since October 2020. The group's funds under management have also more than doubled from S$37 billion to S$88 billion from 2020 to 2024. Over the same period, Keppel saw its asset management fees achieve a 25% compound annual growth rate (CAGR) of 25%, rising from S$180 million to S$436 million. Venture Corporation is a provider of technology products, services, and solutions. The group serves a diverse set of customers in life science, genomics, healthcare, luxury lifestyle, and other sectors. Venture saw its share price fall 20.8% YTD and bounce off its 52-week low of S$10.17. For 2024, Venture reported a downbeat set of earnings as the semiconductor sector remained in the doldrums. Revenue fell 9.6% year on year to S$2.7 billion while net profit tumbled 9.3% year on year to S$245 million. However, the contract manufacturer generated a healthy positive free cash flow of S$465.7 million, dipping just 1.6% year on year from the prior year's S$473.5 million. A final dividend of S$0.50 was declared, taking the total dividend for 2024 to S$0.75, unchanged from 2023. Looking ahead, the board plans to accelerate its share buyback programme to improve shareholder returns. Growth initiatives include tapping the rising demand for hyperscale data centres and securing new product wins in the test and instrumentation domain. Management has affirmed that Venture is at various stages of implementing new business wins in design and manufacturing for products in a variety of different sectors. Jardine Cycle and Carriage, or JC&C, is an investment holding company with investments in Indonesia and Vietnam. Some of its investments include Cycle & Carriage, a leading automotive dealership group in Singapore, and a 50.1% position in Astra, which deals with automotive, heavy equipment, and mining and construction in Indonesia. JC&C's share price plummeted 18.1% YTD and recently hit its 52-week low of S$23.10. The group reported a mixed set of earnings for 2024 with revenue staying flat year on year at US$22.3 billion. Underlying net profit slid 5% year on year to US$1.1 billion. The conglomerate slashed its dividend per share also by 5% year on year to US$1.12 but saw its net asset value rise 3% year on year to US$21. JC&C monetised its non-core assets in Malaysia and Indonesia last year, releasing a total of US$387 million. At the same time, it deployed US$99 million in the infrastructure, automotive, and healthcare sectors in Indonesia and the agriculture, property, and renewables sectors in Vietnam. Mapletree Logistics Trust, or MLT, is a logistics REIT with a portfolio of 183 properties across eight countries with total assets under management (AUM) of S$13.4 billion. MLT's unit price plunged 18.6% YTD and hit its 52-week low of S$1.03 recently. The REIT reported a downbeat set of earnings for the first nine months of fiscal 2025 (9M FY2025) ending 31 December 2024. Gross revenue slipped 1% year on year to S$547.4 million and net property income dipped 1.5% year on year to S$472.5 million. The weak performance was attributed to weakness in China, the absence of contributions from divested properties, and depreciation of regional currencies against the Singapore dollar. Distribution per unit tumbled 10.2% year on year to S$0.06098. Despite the weaker performance, MLT boasted a high portfolio occupancy rate of 96.3%. It also registered a positive rental reversion of 3.4% for the latest quarter. MLT's manager is carrying on with active portfolio rejuvenation. Three yield-accretive acquisitions were conducted in 9M FY2025 in both Malaysia and Vietnam. Elsewhere, a total of 13 properties with older specifications and limited redevelopment potential were divested for S$201 million, all at premiums to their valuations. First-time investors: We've finally released our Beginner's Guide. Read it in an afternoon, follow the principles, pick an investing style and buy your first SGX stocks within the next few hours! Click here to download it for free. Follow us on Facebook and Telegram for the latest investing news and analyses! Disclosure: Royston Yang does not own shares in any of the companies mentioned. Note: Share price as of 9 April 2025 The post 4 Singapore Blue-Chip Stocks Plunging to Their 52-Week Lows: Are They a Steal? appeared first on The Smart Investor.
