MSEX Intrinsic Value
Intrinsic Value of MSEX Overview
MSEX Historical Intrinsic Value
MSEX Valuation Metrics
MSEX DCF Model
| Dec'20 Actual | Dec'21 Actual | Dec'22 Actual | Dec'23 Actual | Dec'24 Actual | Dec'25 Estimate | Dec'26 Estimate | Dec'27 Estimate | Dec'28 Estimate | Dec'29 Estimate | Dec'30 Estimate | Dec'31 Estimate | Dec'32 Estimate | Dec'33 Estimate | Dec'34 Estimate | Dec'35 Terminal | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
% growth | 141.6 5.2% | 143.1 1.1% | 162.4 13.5% | 166.3 2.4% | 191.9 15.4% | 202.5 5.5% | 220.9 9.1% | 239.2 8.3% | 256.9 7.4% | 273.8 6.6% | 289.5 5.7% | 303.6 4.9% | 315.9 4.0% | 326.0 3.2% | 333.6 2.3% | 338.6 1.5% |
% margin | 37.4 26.4% | 33.2 23.2% | 47.3 29.1% | 39.2 23.6% | 53.2 27.7% | 54.1 26.7% | 59.1 26.7% | 64.0 26.7% | 68.7 26.7% | 73.2 26.7% | 77.4 26.7% | 81.2 26.7% | 84.5 26.7% | 87.2 26.7% | 89.2 26.7% | 90.6 26.7% |
NOPAT % effective tax rate | 41.9 29.6% | 39.1 27.3% | 44.0 27.1% | 38.0 22.8% | 46.0 24.0% | 46.8 23.1% | 51.1 23.1% | 55.3 23.1% | 59.5 23.1% | 63.4 23.1% | 67.0 23.1% | 70.3 23.1% | 73.1 23.1% | 75.4 23.1% | 77.2 23.1% | 78.4 23.1% |
% of revenue | 20.8 14.7% | 26.8 18.7% | 27.5 16.9% | 29.4 17.7% | 28.0 14.6% | 33.2 16.4% | 36.3 16.4% | 39.2 16.4% | 42.2 16.4% | 44.9 16.4% | 47.5 16.4% | 49.8 16.4% | 51.8 16.4% | 53.5 16.4% | 54.8 16.4% | 55.6 16.4% |
% of revenue | (105.6) (74.6%) | (79.4) (55.5%) | (91.3) (56.2%) | (90.2) (54.2%) | 0.0 0.0% | (74.5) (36.8%) | (81.3) (36.8%) | (88.1) (36.8%) | (94.6) (36.8%) | (100.8) (36.8%) | (106.6) (36.8%) | (111.8) (36.8%) | (116.3) (36.8%) | (120.0) (36.8%) | (122.8) (36.8%) | (124.7) (36.8%) |
% of revenue | 9.4 6.6% | (19.0) (13.3%) | 1.4 0.8% | (3.0) (1.8%) | 0.0 0.0% | (0.7) (0.3%) | (0.7) (0.3%) | (0.8) (0.3%) | (0.8) (0.3%) | (0.9) (0.3%) | (0.9) (0.3%) | (1.0) (0.3%) | (1.0) (0.3%) | (1.1) (0.3%) | (1.1) (0.3%) | (1.1) (0.3%) |
Free Cash Flow to Firm (FCFF) % of revenue | (33.5) (23.7%) | (32.5) (22.7%) | (18.5) (11.4%) | (25.8) (15.5%) | 74.1 38.6% | 4.9 2.4% | 5.3 2.4% | 5.8 2.4% | 6.2 2.4% | 6.6 2.4% | 7.0 2.4% | 7.3 2.4% | 7.6 2.4% | 7.8 2.4% | 8.0 2.4% | 8.1 2.4% |
% of FCFF used in calculation | 80.8% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | 100.0% | ||||||
Discount period | 0.50 | 1.50 | 2.50 | 3.50 | 4.50 | 5.50 | 6.50 | 7.50 | 8.50 | 9.50 | ||||||
Discount factor | 0.97 | 0.91 | 0.86 | 0.81 | 0.76 | 0.72 | 0.67 | 0.63 | 0.60 | 0.56 | ||||||
Discounted FCFF (DFCFF) | 3.8 | 4.8 | 4.9 | 5.0 | 5.0 | 5.0 | 4.9 | 4.8 | 4.7 | 4.5 |
MSEX DCF Value
DCF Value Calculation
Equity Value Bridge
MSEX Earnings Power Value and Enterprise Value
MSEX Reverse DCF
Reverse DCF Assumptions and Outputs
Implied Free Cash Flow growth vs Historical average vs Industry growth
Competing with MSEX Intrinsic Value
Company name | Market Cap | Enterprise Value | Intrinsic Value | DCF Value | Relative value | Ben Graham Revised fair value | Peter Lynch fair value | Earnings Power Value (EPV),
% of EV | Market-Implied Value of Growth (MIVoG),
% of EV | Reverse DCF (implied FCF growth) | Reverse DCF (implied Revenue growth) |
$1,133.4M | $1,515.1M | $31.0 50.7% overvalued | Negative 120.0% overvalued | $31.0 50.7% overvalued | $12.3 80.4% overvalued | $14.3 77.2% overvalued | 55.8% | 44.2% | 4.4% | 16.7% | |
$28.3B | $42.3B | $67.0 53.3% overvalued | N/A | $67.0 53.3% overvalued | $59.9 58.2% overvalued | $47.1 67.2% overvalued | 67.3% | 32.7% | (100.0%) | (100.0%) | |
$11.2B | $14.7B | $27.1 65.0% undervalued | $23.2 41.0% undervalued | $31.1 89.3% undervalued | $403.3 2,351.4% undervalued | $37.2 125.9% undervalued | 158.4% | (58.4%) | 1.4% | (0.3%) | |
$11.0B | $18.7B | $20.7 47.7% overvalued | N/A | $20.7 47.7% overvalued | $6.6 83.4% overvalued | $9.4 76.2% overvalued | 90.2% | 9.8% | (100.0%) | (100.0%) | |
$3,041.3M | $3,952.8M | $46.9 41.3% overvalued | N/A | $46.9 41.3% overvalued | $29.2 63.5% overvalued | $21.4 73.3% overvalued | 62.1% | 37.9% | (100.0%) | (100.0%) | |
$2,863.8M | $2,887.3M | $66.3 39.8% undervalued | N/A | $66.3 39.8% undervalued | Negative 228.4% overvalued | Negative 162.4% overvalued | 95.0% | 5.0% | (100.0%) | (100.0%) | |
$1,850.8M | $1,843.4M | $61.5 12.1% undervalued | $29.8 46.0% overvalued | $93.2 69.9% undervalued | $24.2 55.9% overvalued | $18.9 65.5% overvalued | 108.7% | (8.7%) | (100.0%) | (100.0%) | |
$917.7M | $1,348.6M | $50.9 66.5% undervalued | N/A | $50.9 66.5% undervalued | Negative 150.2% overvalued | Negative 117.6% overvalued | 101.2% | (1.2%) | (10.2%) | 3.6% | |
$498.5M | $704.1M | $18.3 47.1% overvalued | N/A | $18.3 47.1% overvalued | $13.7 60.5% overvalued | $12.1 65.0% overvalued | 67.3% | 32.7% | 4.7% | (100.0%) | |
$454.6M | $354.0M | $47.9 69.9% undervalued | $56.1 99.0% undervalued | $39.7 40.8% undervalued | Negative 278.9% overvalued | Negative 199.7% overvalued | 106.4% | (6.4%) | (3.0%) | 3.8% | |
$341.2M | $514.2M | $34.8 6.3% undervalued | N/A | $34.8 6.3% undervalued | $36.7 12.4% undervalued | $24.9 23.9% overvalued | 88.6% | 11.4% | (7.0%) | (100.0%) |
Intrinsic Valuation Tools
FAQ
What is the DCF value of Middlesex Water Company (MSEX)?
As of today, DCF Value of Middlesex Water Company is ($12.6), which is overvalued by 120.1%, compared to the current market share price of $62.9
How was the DCF Value calculated?
Step 1: Calculating Intrinsic Enterprise Value DCF Value was calculated by estimating Middlesex Water Company future free cash flow and then discounting it, using a chosen discount rate to determine Intrinsic Enterprise Value of $0.0B Step 2: Balance Sheet Adjustments Intrinsic Equity Value is calculated by subtracting Balance Sheet items (Cash & Equivalents, Short-term investments and Total Debt) from previously calculated Intrinsic Enterprise Value. This Intrinsic Equity Value is then divided by the total number of outstanding shares of 0 to determine DCF Value of ($12.6)
What is the Relative value of Middlesex Water Company (MSEX)?
As of today, Relative Value of Middlesex Water Company is $31.0, which is overvalued by 50.7%, compared to the current market share price of $62.9
How was the Relative Value calculated?
Relative Value was calculated by applying various valuation multiples (EV/Revenue, EV/EBITDA, P/E etc.) to Middlesex Water Company financials to determine Relative Value of $31.0
What is Middlesex Water Company (MSEX) discount rate?
Middlesex Water Company current Cost of Equity is 8.1%, while its WACC stands at 6.3%. Cost of Equity is used to value equity, while discounting free cash flow to equity holders (such as Net Income or Free Cash Flow to Equity). Weighted Average Cost of Capital (WACC) is used to value the entire firm, while discounting cash flows available to both debt and equity holders (NOPAT or Free Cash Flow to the Firm)
How is Cost of Equity for Middlesex Water Company (MSEX) calculated?
The Cost of Equity represents the return a company must offer investors to compensate for the risk of investing in its stock. It's calculated using the Capital Asset Pricing Model (CAPM), which combines the risk-free rate, the stock's beta, and the equity risk premium (ERP). This model considers the inherent risk of investing in the stock compared to a risk-free investment and the market's overall risk. Cost of Equity = Risk-Free Rate + Beta x Effective Risk Premium (ERP) 8.1% = 4.3% + 0.8 x 4.6%
How is WACC for Middlesex Water Company (MSEX) calculated?
WACC, or Weighted Average Cost of Capital, is a calculation that reflects the average rate of return a company is expected to pay its security holders to finance its assets. It is a critical measure in financial analysis for valuing a company's entire operations. The WACC formula combines the costs of equity and debt, weighted by their respective proportions in the company's capital structure. WACC = Cost of Equity x Equity Weight in Total Capital + Cost of Debt x (1 - Effective Tax Rate) Debt Weight in Total Capital 6.3% = 8.1% x 25.4% + 0.7% x (1 - 5.4%) x 74.6%