Hammond Manufacturing Company Ltd
TSX:HMM.A

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Hammond Manufacturing Company Ltd
TSX:HMM.A
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Price: 9.86 CAD 1.13%
Market Cap: 111.9m CAD
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DCF Value

This DCF valuation model was created by Alpha Spread and was last updated on Nov 5, 2024.

Estimated DCF Value of one HMM.A stock is 11.35 CAD. Compared to the current market price of 9.86 CAD, the stock is Undervalued by 13%.

HMM.A DCF Value
Base Case
11.35 CAD
Undervaluation 13%
DCF Value
Price
Worst Case
Base Case
Best Case
11.35
DCF Value
Worst Case
Base Case
Best Case
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DCF Value: 11.35 CAD

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 39m CAD. The present value of the terminal value is 88.5m CAD. The total present value equals 127.5m CAD.
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 127.5m CAD
+ Cash & Equivalents 16.9m CAD
+ Investments 2m CAD
Firm Value 146.4m CAD
- Debt 17.6m CAD
Equity Value 128.8m CAD
/ Shares Outstanding 11.3m
HMM.A DCF Value 11.35 CAD
Undervalued by 13%

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
214.4m 258.3m
Operating Income
18.9m 23m
FCFF
8.9m 10.7m

See Also

Discover More

What is the DCF value of one HMM.A stock?

Estimated DCF Value of one HMM.A stock is 11.35 CAD. Compared to the current market price of 9.86 CAD, the stock is Undervalued by 13%.

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, Hammond Manufacturing Company Ltd's future cash flows are projected and then discounted using a chosen discount rate to determine its Present Value, which is calculated at 127.5m CAD.

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 11.35 CAD per share.

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