DCF Studio

    THL.NZ · NZE · Consumer Cyclical

    Tourism Holdings Limited

    Also onConsensus Drift

    Implied value per share

    NZD -0.58

    Market price

    NZD 2.83

    Implied upside

    -120.6%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    AdjustedSome line items were not reported and have been derived. Each one is labelled in the workings below.
    AdjustedReported capital expenditure averages 2.40% of revenue against depreciation and amortisation of 10.61%. A business cannot depreciate more than it invests indefinitely. Capex has been set to 10.61% of revenue so the forecast is not handed free growth. The accounts do not separate depreciation from amortisation, so the combined charge is used - if a large part of it is amortisation of an acquisition, the reported capex is probably right and this substitution is not. Override it if the reported figure is right.
    NoteRisk-free rate is an assumption: NZD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    NZD -0.58-120.6%
    Exit multiple
    NZD 1.36-52.1%
    Market price
    NZD 2.83

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (NZD). Outflows negative.

    0m13m27mFY27FY28FY29FY30FY31
    Nominal FCFFDiscounted to todayNZD
    LineFY27FY28FY29FY30FY31CAGR
    RevenueNZD 927.2mNZD 1.0bnNZD 1.1bnNZD 1.2bnNZD 1.3bn+8.7%
    EBITNZD 32.8mNZD 35.7mNZD 38.8mNZD 42.2mNZD 45.9m+8.7%
    NOPATNZD 23.6mNZD 25.7mNZD 27.9mNZD 30.4mNZD 33.0m+8.7%
    Add depreciation & amortisationNZD 98.4mNZD 106.9mNZD 116.2mNZD 126.4mNZD 137.4m+8.7%
    Less capital expenditureNZD -98.4mNZD -106.9mNZD -116.2mNZD -126.4mNZD -137.4m+8.7%
    Less increase in working capitalNZD -4.4mNZD -4.8mNZD -5.2mNZD -5.7mNZD -6.1m+8.7%
    Free cashflow to firmNZD 19.2mNZD 20.9mNZD 22.7mNZD 24.7mNZD 26.9m+8.7%
    Discount factor0.97050.91410.86100.81100.7639-
    Present valueNZD 18.7mNZD 19.1mNZD 19.6mNZD 20.0mNZD 20.5m+2.4%
    Present Value Of The ForecastNZD 98.0m

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.50%NZD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta0.755Reported 0.634, pulled toward 1.0 (Blume)
    Cost of equity9.41%Risk-free + beta x equity risk premium
    Cost of debt4.50%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationNZD 626.8m47.5% of capital
    Total debtNZD 692.9m52.5% of capital, book value as a proxy
    Tax rate28.0%Effective, capped at statutory
    WACC6.17%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareNZD -0.58

    81% of EV

    Forecast FCFF, final year
    NZD 26.9m
    Capex at depreciation, working capital in reinvestment
    NZD 33.0m
    Less reinvestment at g/ROIC (40.5% of NOPAT)
    NZD -13.4m
    Capitalised
    NZD 19.6m
    ROIC (WACC floor)
    6.2%
    Terminal value, undiscounted
    NZD 548.7m
    Terminal value, discounted
    NZD 419.2m
    Enterprise value
    NZD 517.1m
    Less net debt
    NZD 646.4m
    Equity value
    NZD -129.3m

    Exit at 6.1x EBITDA

    Value per shareNZD 1.36

    90% of EV

    Terminal value, undiscounted
    NZD 1.1bn
    Terminal value, discounted
    NZD 848.8m
    Enterprise value
    NZD 946.8m
    Less net debt
    NZD 646.4m
    Equity value
    NZD 300.4m

    Sensitivity

    Value per share (NZD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.17%0.570.580.600.610.63
    5.17%-0.13-0.12-0.11-0.10-0.09
    6.17%-0.60-0.59-0.58-0.57-0.57
    7.17%-0.94-0.93-0.93-0.92-0.91
    8.17%-1.20-1.19-1.18-1.18-1.17

    Outlined: this model. Green text: above today's price of 2.83. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year8.7%33.6%+24.9pp
    EBIT margin3.5%8.5%+5.0pp
    Discount rate6.2%2.8%-3.4pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.