In the midst of a bull market carried by tech stocks, we look at a blue chip company today: Caterpillar Inc.

A Fortune 100 corporation with revenue of $41Bn, the Deerfield, IL firm designs, develops, engineers, manufactures, markets, and sells machinery, engines, financial products, and insurance to customers via a worldwide dealer network. It is the world’s largest construction-equipment manufacturer.

In the past 12 months, CAT appreciated over 50% and reached a current market cap of $116Bn, but how can we justify this valuation with market data, let’s take a look.

Even as analysts consensus estimates envision Caterpillar outperforming most of its peers in both growth (e.g. 5.3% in 2023 vs peer median of 3.4%) and profitability (19.4% EBITDA margin and 11.9% Net Income margin by 2025, more than twice peers median on both metrics), a simple DCF yields a more conservative valuation of about $60Bn, almost half of today’s market cap.

Looking at trading multiples and precedent transactions extends the range into the mid $80Bn’s but nevertheless it appears that CAT is valued richly by the markets today. Share your thoughts with us or investigate our valuation work with the link below.

Weekly valuations: Caterpillar link to the valuation here

Other recent valuations: Snowflake | Krispy Kreme |Bumble

About Valutico:

Valutico is the world‘s leading provider of web-based company valuation tools.

Valutico is a web based valuations platform providing the financial services industry and valuation practitioners with data-driven tools to conduct analysis more efficiently. With headquarters in Vienna and subsidiaries in the UK & USA Valutico empowers businesses and experts to perform accurate valuations in minutes while solving the issue of complex tools, lack of data sources and time consuming reporting.

Valutico provides access to reliable market data from leading financial databases, cross-checks business plans and provides useful suggestions to promote consistency and plausibility. With over 15 of the world’s leading valuation methodologies to choose from and saving experts precious time transferring results from spreadsheet to slides, Valutico is carving a new generation in valuations.

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Last september, Snowflake made history with the biggest IPO pop since at least a decade, and since then the stock has held up these early gains.

A darling of the tech industry since its founding in 2012, the company is growing impressively and reaching a half billion dollars in revenue in FY 2021, but with a valuation of $82Bn and resulting implied revenue multiple north of 150x, can Snowflake sustain this valuation for longer, let alone grow it further?

Currently losing money at even the EBITDA level, and forecasted to do so for the foreseeable future as it invests heavily in growth, Snowflake can’t adequately be valued using most common methods. Let’s instead just look at revenue multiples then:

Valutico’s broad tech revenue multiple applied to Snowflake yields a valuation of $3.5Bn using 2021 figures (2021 EV/Sales multiple applied: 5.51x), and even 2022 numbers, which assume over 100% top line growth and a 6.25x multiple only reach $7.2Bn, less than 10% of the current market cap. Snowflake is in rare company with a couple dozen companies valued at over 100x sales, but within that list the California-based cloud data warehouse is arguably the closest to becoming a household name.

Weekly valuations: Snowflake link to the valuation here

Other recent valuations: Peloton | Krispy Kreme |Bumble

About Valutico:

Valutico is the world‘s leading provider of web-based company valuation tools.

Valutico is a web based valuations platform providing the financial services industry and valuation practitioners with data-driven tools to conduct analysis more efficiently. With headquarters in Vienna and subsidiaries in the UK & USA Valutico empowers businesses and experts to perform accurate valuations in minutes while solving the issue of complex tools, lack of data sources and time consuming reporting.

Valutico provides access to reliable market data from leading financial databases, cross-checks business plans and provides useful suggestions to promote consistency and plausibility. With over 15 of the world’s leading valuation methodologies to choose from and saving experts precious time transferring results from spreadsheet to slides, Valutico is carving a new generation in valuations.

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As fintech reaches new heights, and alternatives modes of payments ranging from Square’s Cash App to Cryptocurrencies surge, we take a deeper look at a veteran of the payment industry, Visa, Inc.

Up nearly 200% over 5 years and now valued at $500Bn, the California based credit card and payment technology company has traditionally been compared to MasterCard (Market cap $360Bn), but can Visa and its legacy competitor maintain leadership and grow as fast as their challengers (Square, Dwolla, Stripe, PayPal, etc.)?

Industry analysts tend to think so, broadly speaking, as the consensus has the incumbents growing between 15% and 20% over the next 5 years, while maintaining incredible margin performance (50% net income margin). That said, much of these expectations are already factored in the share price and our DCF analysis suggests that the company may be overvalued.

Valutico DCF estimate of Visa’s value: $324Bn

Market cap as of August 4th: $510Bn

Weekly valuations: Visa link to the valuation here

Other recent valuations: Peloton | Krispy Kreme |Bumble

About Valutico:

Valutico is the world‘s leading provider of web-based company valuation tools.

Valutico is a web based valuations platform providing the financial services industry and valuation practitioners with data-driven tools to conduct analysis more efficiently. With headquarters in Vienna and subsidiaries in the UK & USA Valutico empowers businesses and experts to perform accurate valuations in minutes while solving the issue of complex tools, lack of data sources and time consuming reporting.

Valutico provides access to reliable market data from leading financial databases, cross-checks business plans and provides useful suggestions to promote consistency and plausibility. With over 15 of the world’s leading valuation methodologies to choose from and saving experts precious time transferring results from spreadsheet to slides, Valutico is carving a new generation in valuations.

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Earlier this year US dating app Bumble went public, making headlines as its CEO became the youngest woman to take a company public and to become a billionaire, at age 31.

Bumble stood out in the dating market for its unique approach, and for its independence, in a market that was largely consolidated by the Match.com, owner of Tinder, Match and many other leading dating apps, but how have investors reacted to the offering.

With the stock down about 25% since its market debut and the market cap just below $6Bn, has Bumble found its floor from which to rebound (dating pun intended)

Even assuming a top line growth rate superior to that of Match.com for the next 5 years, averaging over 20% (compared to 35% in 2019 and 19% in 2020, admittedly in adverse conditions due to the Covid lockdowns) the DCF for Bumble doesn’t make the case for much optimism. Our findings suggest a valuation of $4.6Bn may be more adequate.

That said, looking at the company through the perspective of public markets offers a different perspective, and based on Revenue and EBITDA multiples one may argue that Bumble is undervalue and could be worth as much as $7.5Bn.

Find out more and view the valuation at https://valutico.com/companies/bumble-inc-41627c52-8b75-4a61-ba75-b86ba34c4b87/evaluations/3s-alHqc-MHOj74weKxFdFNd_0QdyFAoBnChVAN1bB1q6qZaujNaUFfsyGbESfh1x1d8p6TLVwPL9MpMIkQtWw/share

Other recent valuations: Peloton | Morrisons | Krispy Kreme

About Valutico:

Valutico is the world‘s leading provider of web-based company valuation tools.

Valutico is a web based valuations platform providing the financial services industry and valuation practitioners with data-driven tools to conduct analysis more efficiently. With headquarters in Vienna and subsidiaries in the UK & USA Valutico empowers businesses and experts to perform accurate valuations in minutes while solving the issue of complex tools, lack of data sources and time consuming reporting.

Valutico provides access to reliable market data from leading financial databases, cross-checks business plans and provides useful suggestions to promote consistency and plausibility. With over 15 of the world’s leading valuation methodologies to choose from and saving experts precious time transferring results from spreadsheet to slides, Valutico is carving a new generation in valuations.

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The company priced its initial public offering at $17 per share, well below its planned range of $21 to $24, and even opened lower. Shares quickly rebounded to the lower end of its targeted range and the offering gave the firm $500 million of fresh cash injection and an implied valuation of $2.7 billion. Now under the ticker “DNUT”, the firm that also owns Insomnia Cookies is without pure play competitors in the equity market as Dunkin and Tim Hortons are private.

We looked at the financial statements provided with the S-1 filing and analyzed analysts estimates and peers to evaluate the valuation against our methods.

Absent a turnaround that would bring Krispy Kreme’s margins in line in the upper double digits of other fast food chains (including fellow breakfast heavy-hitters Starbucks, IHOP, and Dennys), it remains challenging to justify much optimism in the valuation, even though its top line growth has been stellar.

Market cap: $2.7bn
Weekly valuation Krispy Kreme DCF valuation (assuming margin improvement towards industry median): $942 million

Weekly valuations: Krispy Kreme link to the valuation here

Other recent valuations: Peloton | Morrisons | Aldi

About Valutico:

Valutico is the world‘s leading provider of web-based company valuation tools.

Valutico is a web based valuations platform providing the financial services industry and valuation practitioners with data-driven tools to conduct analysis more efficiently. With headquarters in Vienna and subsidiaries in the UK & USA Valutico empowers businesses and experts to perform accurate valuations in minutes while solving the issue of complex tools, lack of data sources and time consuming reporting.

Valutico provides access to reliable market data from leading financial databases, cross-checks business plans and provides useful suggestions to promote consistency and plausibility. With over 15 of the world’s leading valuation methodologies to choose from and saving experts precious time transferring results from spreadsheet to slides, Valutico is carving a new generation in valuations.

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With the offer being just at the current market cap, could there be a case to support this claim and justify a higher valuation? Let’s dive into some of the basics:

— Revenue growth is forecasted to remain at low single digits for the next few years
— Net income margin is expected to remain around 2%

Assuming this relative stability in the P&L, a DCF method yields a valuation range nearly 3x the current market cap (and CDR bid), giving credence to the firm’s pushback.

But looking at market based methods we notice that the trading multiples for Morrisons’ peers would suggest a valuation barely half of its current market capitalization; perhaps hinting why the bid didn’t carry a significant premium.

What is your take on the situation and do you think the offer was adequately priced? (link to the valuation)

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In the past week, investors and courts alike have struck the oil and gas industry with mandates to decrease their reliance on fossil fuel. The landmark boardroom and courtroom defeats show growing pressure on international oil and gas companies to set targets that are consistent with the Paris Agreement.

“It is not often that three of the supermajors are prominently in the headlines within a 24-hour period, but that was certainly the case yesterday,” analysts at Raymond James said last week.

Having said that, Exxon’s market cap is hovering around $250Bn and its stock at a 52 week high, so the company seems to be recovering from the pandemic.
Let’s look at how this current market cap compares to our estimates of enterprise value using a simple DCF method and based on a PE multiple approach:
Market cap: $256Bn
Valutico range: $270bn to $290bn
Exxon Mobil may be undervalued at the moment, or its stock price may be reflecting of upcoming challenges that haven’t yet been represented in all analysts’ estimates (Valutico based its forecasts on consensus estimates), what’s your take? #valuations #exxon

Link to the valuation

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Recently in the news for a recall of its treadmill product, the company’s stock has cooled off a bit and retreated to $100 per share after a high above $160. Though some of this decline may be related to the broader slowdown of growth stocks.

That said, software companies typically trade at significantly higher multiples than their peers rooted in the world of services, or tangible products with real manufacturing challenges, supply chains, … and occasional product recalls.

We assessed the company’s valuation based on cash flow projections and revenue multiples, choosing a conservative 2x multiple between the 1.5x median of the leisure product category and the > 4x median of the software sector.

Here’s how our analysis compares to the current market cap:

Market cap: $30Bn
Valutico’s DCF valuation: $13Bn
2x Sales 2021Estimate: $9.2Bn

Even if considering Peloton as a software company and valuing the company at a richer 4x Sales multiple, one may find the current market cap to indicate an overvalued, but between a potential takeover scenario and the impressive growth figures, the full picture may be a bit more nuanced.

Link to the valuation

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Turned into a mainstream discussion topic by the pandemic, the pharmaceutical giant capitalized on its success in creating a vaccine to reap huge rewards, for the year 2021, Pfizer estimates it could generate as much as $26 billion in revenue, an increase from earlier estimates of “just” $15 billion.

That said, many analysts remain cautious about the company’s outlook beyond the pandemic, as concerns over its long term pipeline remain.

But what is Pfizer really worth:

With a market cap of $223Bn the company is the 3rd largest in its market, behind JnJ and Roche, but is it fairly valued?

Our income based models, both DCF and DDM seem to suggest it could be as much as $100Bn undervalued, as they both yield values north of $300Bn (assuming, per analysts consensus estimates that 2021 revenue represents nearly 70% growth over 2020, and that 2022 would see a large retraction post-vaccine).

But our market based methods seem more in line with the company’s current market cap, closer to $250Bn

What is your outlook on the pharma behemoth?

Link to the valuation: https://valutico.com/companies/pfizer-inc-2560cf49-4d10-4316-afa3-23d606bcbc4c/evaluations/I84M2X6WrO6JcS7CdW9cFpJzPbi6IuDv6lnHIpPCWZGdRWXpZ6JUmuXQSmn4XQWXoC6UgUmGyGRc5vRT28FRRA/share

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Turned into a mainstream discussion topic by the pandemic, the pharmaceutical giant capitalized on its success in creating a vaccine to reap huge rewards, for the year 2021, Pfizer estimates it could generate as much as $26 billion in revenue, an increase from earlier estimates of “just” $15 billion.

That said, many analysts remain cautious about the company’s outlook beyond the pandemic, as concerns over its long term pipeline remain.

But what is Pfizer really worth:

With a market cap of $223Bn the company is the 3rd largest in its market, behind JnJ and Roche, but is it fairly valued?

Our income based models, both DCF and DDM seem to suggest it could be as much as $100Bn undervalued, as they both yield values north of $300Bn (assuming, per analysts consensus estimates that 2021 revenue represents nearly 70% growth over 2020, and that 2022 would see a large retraction post-vaccine).

But our market based methods seem more in line with the company’s current market cap, closer to $250Bn

What is your outlook on the pharma behemoth?

Link to the valuation: https://valutico.com/companies/pfizer-inc-2560cf49-4d10-4316-afa3-23d606bcbc4c/evaluations/I84M2X6WrO6JcS7CdW9cFpJzPbi6IuDv6lnHIpPCWZGdRWXpZ6JUmuXQSmn4XQWXoC6UgUmGyGRc5vRT28FRRA/share

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