Discounted Cash Flow Calculation for DB:9SP using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
Note: Free cash flow to equity valuations ignore the company's cash or debt.
DB:9SP DCF 1st Stage: Next 10 year cash flow forecast
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.
Savannah Petroleum's share price is below the future cash flow value, and at a moderate discount (> 20%).
Savannah Petroleum's share price is below the future cash flow value, and 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
Savannah Petroleum's earnings available for a low price, and how does
this compare to other companies in the same industry?
Savannah Petroleum's earnings are expected to grow significantly at over 20% yearly.
Unable to determine if Savannah Petroleum 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.
Savannah Petroleum'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
Oil and Gas
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
0/6, 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
Savannah Petroleum's finances.
The net worth of a company is the difference between its assets and liabilities.
Savannah Petroleum's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
Savannah Petroleum's cash and other short term assets cover its long term commitments.
This treemap shows a more detailed breakdown of
Savannah Petroleum'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.
High level of physical assets or inventory.
Debt is covered by short term assets, assets are 2.2x 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.
Mr. Andrew Allister Knott serves as the Chief Executive Officer at Savannah Petroleum Plc. Mr. Knott has held leading roles in the European oil and gas sector for the last decade with extensive energy and investment experience across emerging markets. He has been Executive Director at Savannah Petroleum Plc since July 3, 2014. He served as the Head of Global Energy Investments at GLG Partners/MAN Group which, at December 2012, was the largest listed hedge fund in the world by assets. Prior to GLG Partners, he held various roles at Merrill Lynch and Dresdner Kleinwort Wasserstein. He served as a Portfolio Manager of GLG Partners, Inc., since September 2008. He was responsible for establishing a new global energy product and managing its global energy investments, also provides input into the energy related investments across GLG's existing strategies. He joined GLG Partners, Inc.'s London office. Prior to this, he served as Research Analyst at BofA Merrill Lynch, Research Division, where he ran the European Oil & Gas Exploration and Production Equity Research team, part of it's European Oil & Gas Equity Research Group. From 2003 to 2005, he served as an Oil & Gas Equity Research Analyst of Dresdner Kleinwort. Prior to that, he served as an Executive in Project Finance at KPMG LLP. He served as an Oil and Gas Equity Research Analyst at Dresdner Kleinwort, Research Division. Mr. Knott received a First Class Honors degree in Economics and Accounting from the University of Edinburgh.
Andrew's compensation has increased whilst company is loss making.
Andrew's remuneration is higher than average for companies of similar size in Germany.
CEO & Executive Director
CFO, Company Secretary & Director
Chief Operating Officer
Board of Directors Tenure
Average tenure of the
board of directors in years:
The tenure for the Savannah Petroleum board of directors is about average.
Board of Directors
CEO & Executive Director
Non-Executive Vice Chairman
CFO, Company Secretary & Director
Who owns this company?
Recent Insider Trading
No 3 month open market individual insider trading information.
Savannah Petroleum Plc, an oil and gas company, engages in the exploration of hydrocarbons in the Republic of Niger. The company’s principal assets are the R1/R2 and R3/R4 PSC that cover an area of 13,655 km2 located in the Agadem rift basin in South East Niger. Savannah Petroleum Plc was incorporated in 2014 and is based in London, the United Kingdom.
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