Discounted Cash Flow Calculation for SNSE:SCOTIABKCL using Excess Returns Model Model
The calculations below outline how an intrinsic value for Scotiabank Chile is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.
In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.
The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.
The current share price of
is above its future cash flow value.
Often investors are willing to pay a
for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
is considered below, and whether this is a fair price.
Price based on past earnings
Scotiabank Chile's earnings available for a low price, and how does
this compare to other companies in the same industry?
In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Scotiabank Chile has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.
This is quite a rare situation as 97% of companies covered by Simply Wall St do have past financial data. You can see them here.
Show me the analysis anyway
The future performance of a company is measured in the same way as past
performance, by looking at estimated
and how much profit it is expected to make.
Future estimates come from
professional analysts. Just like forecasting the weather, they don’t always get
Expected Banks industry annual growth in earnings.
Earnings growth vs Low Risk Savings
expected to grow at an
Unable to compare Scotiabank Chile's earnings growth to the low risk savings rate as no estimate data is available.
Growth vs Market Checks
Unable to compare Scotiabank Chile's earnings growth to the Chile market average as no estimate data is available.
Unable to compare Scotiabank Chile's revenue growth to the Chile market average as no estimate data is available.
Unable to determine if Scotiabank Chile is high growth as no earnings estimate data is available.
Unable to determine if Scotiabank Chile is high growth as no revenue estimate data is available.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Scotiabank Chile's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
has a total score of
3/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Fundamentally a bank's business is based upon borrowing and lending money, for
this reason they typically have high levels of debt and we analyse them
This treemap shows a more detailed breakdown of
Scotiabank Chile's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
Francisco JavierSardón De Taboada
Mr. Francisco Javier Sardon de Taboada is Executive Vice President and Country Head of Chile at Bank of Nova Scotia in November 2017. He has been the Chief Executive Officer of Scotiabank Chile. He is also President of the Board of Scotia Administradora General de Fondos Chile S.A., Scotia Corredores de Seguros Chile Ltda. and CAT Administradora de Tarjetas S.A. Francisco joined Scotiabank in 2004 and has held a number of senior executive roles across Peru and Chile. He was, most recently, Senior Vice President, CEO & Country Head Scotiabank Chile from August 2013 to November 2017. He is Board Member of the Chilean Banking Association, as well as member of its CEO´s Committee. As Executive Vice President and Country Head of Chile, Francisco is responsible for overseeing all of Chile’s personal, small business and commercial banking operations. Throughout his career in Scotiabank, he has also held important roles in the industry as Board Member of Profuturo Administradora de Pensiones in Peru, the Canadian-Peruvian Chamber of Commerce and Instituto Peruano de Acción Empresarial (IPAE). Prior to joining Scotiabank, Francisco was Senior Vice President, CEO & Country Head of Standard Chartered Bank Peru, Board Member of the Peruvian Banking Association, member of its CEO´s Committee and Chief Financial Officer of Banco Financiero. He has also sat on the Boards of Transbank, Redbanc and Nexus, the three largest payment and transaction networks in Chile. Francisco Sardon holds a Law Degree from Universidad Católica Santa María from Peru, he has a DPA in Business Administration from Universidad Adolfo Ibañez from Chile and he is graduated from the Advanced Management Program (AMP) at Harvard Business School from USA from 1985 to 1990.
Insufficient data for Francisco Javier to compare compensation growth.
Insufficient data for Francisco Javier to establish whether their remuneration is reasonable compared to companies of similar size in .
Management Team Tenure
Average tenure of the
management team in years:
The average tenure for the Scotiabank Chile management team is less than 2 years, this suggests a new team.
Francisco Javier Sardón De Taboada
CEO & Country Head
María Victoria Doberti
Senior Vice President of Finance
Eduardo Meynet Biancardi
Vice President of Operations & Shared Services
Juan Antonio M. Vargas
Vice President of System & Technology
Artus Jacqueline Balbontin
Vice President of HR & Corporate Affairs
Senior Vice President of Corporate Banking & Commercial Banking Division
Senior Vice-President of Risk
Ana Paula Aleixo
Head of Sustainability and Corporate Social Responsibility
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the Scotiabank Chile board of directors is less than 3 years, this suggests a new board.
Board of Directors
José Said Saffie
President of the Board of Directors
Manuel José Vial Vial
Vice president of the Board of Directors
Chairman of Scotiabank
Sergio Concha Munilla
Fernanda Vicente Mendoza
Ignacio Deschamps González
Jaime Said Handal
Ernesto Mario Viola
Salvador Said Somavia
Gonzalo Said Handal
Who owns this company?
Recent Insider Trading
No 3 month open market individual insider trading information.
Scotiabank Chile, S.A. provides banking products and services in Chile. Its deposit products include current, checking, and daily rent accounts; term deposits; and voluntary pension saving products. The company also provides consumer, automotive, and mortgage credits; and credit lines and credit cards. In addition, it offers insurance products, such as automotive, RCI, travel, transportation, and general insurance. Further, the company provides mutual funds, commercial credit, line of credit, factoring, leasing, foreign trade, and cash management services. Scotiabank Chile, S.A. operates through a network of 169 branches located in Arica and Punta Arenas. The company was founded in 1990 and is based in Santiago, Chile.
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