Solomon Systech (International) Ltd
HKEX:2878

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Solomon Systech (International) Ltd
HKEX:2878
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Price: 0.48 HKD 2.13%
Market Cap: 1.2B HKD
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DCF Value

This DCF valuation model was created by Alpha Spread and was last updated on Dec 23, 2024.

Estimated DCF Value of one 2878 stock is 0.74 HKD. Compared to the current market price of 0.48 HKD, the stock is Undervalued by 35%.

DCF Value
Base Case
0.74 HKD
Undervaluation 35%
DCF Value
Price
Worst Case
Base Case
Best Case
0.74
DCF Value
Worst Case
Base Case
Best Case
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DCF Value: 0.74 HKD

Present Value Calculation

This block is the starting point of the DCF valuation process. It calculates the present value of a company's forecasted cash flows based on selected operating model. Adjust key parameters like discount rate and terminal growth, and alter inputs such as revenue growth and margins to see their impact on valuation.

DCF Model
Base Case Scenario

The present value of cash flows over the next 5 years amounts to 52.3m USD. The present value of the terminal value is 88.2m USD. The total present value equals 140.5m USD.
Forecast Period
Years
Discount Rate
%
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Terminal Growth
%
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DCF Value Calculation

This stage translates the present value into DCF value per share. For firm valuation models, it adjusts present value for debt and assets to derive equity value (skipped if using equity valuation model). Finally, this equity value is divided by the number of shares to determine the DCF value per share.

Present Value to DCF Value
Capital Structure

Present Value 140.5m USD
+ Cash & Equivalents 96.1m USD
+ Investments 2m USD
Firm Value 238.5m USD
- Debt 2.1m USD
- Minority Interest -65k USD
Equity Value 236.5m USD
/ Shares Outstanding 2.5B
Value per Share 0.09 USD
USD / HKD Exchange Rate 7.7759
2878 DCF Value 0.74 HKD
Undervalued by 35%

Valuation Analysis

Sensitivity Analysis
DCF Value Sensitivity Analysis

Sensitivity Analysis assesses how changes in key factors like revenue growth, margin, and discount rate affect a stock's DCF value. By visualizing various scenarios, from significant downturns to optimistic growth, this tool helps you understand potential valuation shifts, aiding in risk assessment and strategic decision-making.

DCF Financials
Financials used in DCF Calculation

Revenue
154.8m 169.3m
Operating Income
14m 17.8m
FCFF
13.4m 13.4m

See Also

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What is the DCF value of one 2878 stock?

Estimated DCF Value of one 2878 stock is 0.74 HKD. Compared to the current market price of 0.48 HKD, the stock is Undervalued by 35%.

The true DCF Value lies somewhere between the worst-case and best-case scenario values. This is because the future is not predetermined, and the stock's DCF Value is based almost entirely on the future of the company. Knowing the full range of possible stock DCF values gives a complete picture of the investment risks and opportunities.

How was the DCF Value calculated?

1. Present Value Calculation. Utilizing the DCF operating model, Solomon Systech (International) Ltd's future cash flows are projected and then discounted using a chosen discount rate to determine its Present Value, which is calculated at 140.5m USD.

2. DCF Value Calculation. The company's capital structure is employed to derive the total Equity Value from the previously calculated Present Value of the cash flow. This Equity Value, when divided by the total number of outstanding shares, yields the DCF Value of 0.74 HKD per share.

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