Time Warner

Navigate firm data through the following pages:

Analyst Listing       Primary Input Data
Derived Input Data       Valuation Model Outcomes

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Pacific Crest Securities-KBCM Andy Hargreaves ahargreaves@pacific-crest.com
Nomura Anthony DiClemente anthony.diclemente@nomura.com
Stifel Nicolaus Benjamin E. Mogil bmogil@stifel.com
Pivotal Research Group Brian Wieser brian@pvtl.com
Deutsche Bank Research Bryan Kraft bryan.kraft@db.com
Topeka Capital Markets David W. Miller dwm@topekacapitalmarkets.com
Cowen & Company Doug Creutz doug.creutz@cowen.com
Wells Fargo Securities John Janedis jjanedis@jefferies.com
Needham Laura Martin lmartin@needhamco.com
Cowen & Company Marci Ryvicker marci.ryvicker@wellsfargo.com
Guggenheim Securities Michael C. Morris michael.morris@guggenheimpartners.com
RBC Capital Markets Steven Cahall steven.cahall@rbccm.com
Drexel Hamilton Tony Wible twible@drexelhamilton.com
Deutsche Bank Research Bryan Kraft bryan.kraft@db.com
Raymond James Frank G. Louthan IV frank.louthan@raymondjames.com
Barrington Research James C. Goss jcg@brai.com
Scotiabank GBM Jeffrey Fan jeff.fan@scotiabank.com
RBC Capital Markets Jonathan Atkin jonathan.atkin@rbccm.com
Needham Laura Martin lmartin@needhamco.com
Wells Fargo Securities Marci Ryvicker marci.ryvicker@wellsfargo.com
Wunderlich Securities Matthew Harrigan mharrigan@wundernet.com
Jefferies Mike McCormack mmccormack@jefferies.com
Evercore ISI Vijay Jayant vijay.jayant@evercoreisi.com

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Primary Input Data

 

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Derived Input Data

Derived Input

Label

2015  Value

2016  Value

Equational Form
Net Operating Profit Less Adjusted Taxes NOPLAT   4,447  4,954 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF  3,428  4,251 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS  420  343 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC  55,846  56,263 IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC 7.96% 8.81% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv  173  1,086 NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR 3.89% 21.92% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital WACCMarket 8.99% 15.68% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook  6.95% 6.40%
Enterprise value EVMarket  75,846  101,909  EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook  73,468 95,374
EV/EBIT Multiple \frac{EV_{Market}}{EBIT}  11.09   13.37 EV/EBIT\,=\,\frac { EV}{ EBIT}
Long-Run Growth g = IR x ROIC
   0.31%    1.93% Long-run growth rates of the income variable  are used in the Continuing Value portion of the valuation models.
 g = % \Delta GDP   2.50%   2.50%

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Valuation Model Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs and, depending on the equational form of any particular valuation model, may result in irrelevant or implausible results.  For example, in the event WACC < g, the value of this term, often found in the denominator of an equation’s continuation value term, will be expressly negative and may result in a negative overall valuation for the firm.  In the event of a WACC < g relation, the model form as applied to the subject firm offers an irrelevant outcome.

Valuation Model Type

Label

Equational form
Key Value Driver (NOPLAT) KVD (NOPLAT) { Value }_{ DCF/KVD }=\sum { \frac { NOPLAT_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { NOPLAT }_{ 1 }\left( 1-\frac { g }{ ROIC } \right) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Key Value Driver (FCF) KVD (FCF)
{ Value }_{ DCF/KVD }=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { NOPLAT }_{ 1 }\left( 1-\frac { g }{ ROIC } \right) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Free Cash Flow FCF { Value }_{ DCF/FCF }=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { \frac { { FCF }_{ 1 }}{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Economic Profit ECON π { Value }_{ { ECON\pi } }= I{ C }_{ 0 }+\sum { \frac { { IC }_{ t-1 }(ROI{ C }_{t}-WAC{C}_{t}) }{ { \left( 1+WACC \right) }^{ t } }+ \frac {\frac { I{C}_{0}\ x\ (ROI{C}_{1}\ -\ WAC{C}_{1}) }{ WACC-g } }{ { \left( 1+WACC \right) }^{ t } } }
 
Adjusted Present Value APV { Value }_{ APV }=\sum { \frac { FCF_{ t } }{ { \left( 1+{ k }_{ u } \right) }^{ t } } +\frac { \frac { { FCF }_{ 1 }}{ { k }_{ u }-g } }{ { \left( 1+{ k }_{ u } \right) }^{ t } } } +\sum { \frac { { TS }_{ t } }{ { \left( 1+{ k }_{ tax } \right) }^{ t } } +\frac { \frac { { TS }_{ 1 }}{ { k }_{ tax }-g } }{ { \left( 1+{ k }_{ tax } \right) }^{ t } } }
 
Forward Market Multiple FMM { Value }_{ DCF/FMM}=\sum { \frac { FCF_{ t } }{ { \left( 1+WACC \right) }^{ t } } +\frac { { EBIT }_{ 1 }\,{x}\,{FMM}}{ { \left( 1+WACC \right) }^{ t } } }{\,\,\,; \,\,FMM\,=\,\frac{{EV}_{t=0}}{{EBIT}_{t=0}}}
 

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