Discounted Cash Flow Calculation for DB:ME1 using Excess Returns Model Model
The calculations below outline how an intrinsic value for Banca Mediolanum 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.
Amount off the current price
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
Banca Mediolanum's share price is below the future cash flow value, but not at a moderate discount (< 20%).
Banca Mediolanum's share price is below the future cash flow value, but not at a substantial discount (< 40%).
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
Banca Mediolanum's earnings available for a low price, and how does
this compare to other companies in the same industry?
Banca Mediolanum's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.
Banca Mediolanum's revenue is expected to grow significantly at over 20% yearly.
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.
Banca Mediolanum'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.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
Banca Mediolanum's finances.
The net worth of a company is the difference between its assets and liabilities.
Banca Mediolanum's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
Banca Mediolanum's long term commitments exceed its cash and other short term assets.
This treemap shows a more detailed breakdown of
Banca Mediolanum'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.
Low level of unsold assets.
Debt is covered by short term assets, assets are 26.8x debt.
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.
TENURE AS CEO
Mr. Massimo Antonio Doris serves as Managing Director and Director of Banca Mediolanum S.p.A. Mr. Doris started his career at Banca Mediolanum in 1999 as Financial Advisor. Previously he was based in London where he worked as sales assistant at UBS, Merrill Lynch and Credit Suisse Financial Products. He then became Marketing Manager in charge of the launch of the Online Banking website. He was subsequently named Head of the Sales Network Training. In October 2003, he took on the position of Italian Network Manager of Banca Mediolanum S.p.A. and was in charge of the Italian Sales Network until September 2005, after which he moved to Barcelona to take on the positions of Chief Executive Officer, General Manager and Head of Development of the Spanish banking group Banco de Finanzas e Inversiones. In July 2008, he returned to Italy as Chief Executive Officer and General Manager of Banca Mediolanum S.p.A. Starting May 2009. He is a Director of Banca Esperia S.p.A.
Insufficient data for Massimo to compare compensation growth.
Massimo's remuneration is lower than average for companies of similar size in Germany.
CEO & Director
Financial Reporting Officer
Head of Investor Relations
Head of Compliance
Ettore Parlato Spadafora
Head of Legal & Compliance Control
Head of Internal Auditing
Secretary to the Board of Directors
Executive of Investor Relations
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the Banca Mediolanum board of directors is about average.
Board of Directors
Chairman of the Board
CEO & Director
Executive Deputy Chairman of the Board
Domenico Magno Fava
Chairman of the Board of Statutory Auditors
Carlos Javier Tusquets Trías de Bes
Anna Eugenia Omarini
Who owns this company?
Recent Insider Trading
No 3 month open market individual insider trading information.
Banca Mediolanum S.p.A. provides various banking products and services in Italy. The company offers current accounts; and mortgages and loan products. It also provides credit, debit, and prepaid cards; investment products, such as equities and bonds, as well as trading services; and insurance and pension products and services. The company was founded in 1982 and is based in Basiglio, Italy.
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