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META, a -5% lower target price
Current 116 Target 110 -5%
December 10th 2021
1 minute read
Sales declined-6%
Costs 4 points higher, net loss, we use lower Cashflow costs to predict net profit
Cashflow less negative & expected positive
Balance sheet, ever higher leverage
Valuation, more capital raised, a -5% lower target price
1 minute read
Sales declined-6%
- Sales declined -6% in the third quarter to 155 billion rupiah vs our 171 billion rupiah forecast.
- This brings the quarterly average to 5% growth.
- We predict average growth of 3% in this next 12 months to bring sales to 175 billion rupiah in the third quarter of 2022.
Costs 4 points higher, net loss, we use lower Cashflow costs to predict net profit
- The cash cost ratio was at -85% in the third quarter giving a -10 billion rupiah net profit.
- The average Cashflow cost ratio is lower at -76% now.
- We use the Cashflow -76% cost ratio to predict a 8 billion rupiah profit in the third quarter of 2022.
Cashflow less negative & expected positive
- Free cashflow was less negative -9 billion rupiah in the third quarter even with more negative -95 billion rupiah investment Cashflow.
- Average quarterly Cashflow is at -118 billion rupiah now.
- We assume lower -8 billion rupiah investment spending which with higher sales gives a 33 billion rupiah Cashflow in the third quarter of 2022.
Balance sheet, ever higher leverage
- Cash declined from 330 to 308 billion rupiah in the third quarter.
- Liabilities increased from 2,594 to 3,339 billion rupiah so net cash worsened from -2,264 to -3,031 billion rupiah.
- With our forecast cashflow & a 0 billion rupiah equity payout net cash will be -2,904 billion rupiah in 12 months time.
Valuation, more capital raised, a -5% lower target price
- META capital from the last 27 quarters was more negative -2,608 billion rupiah in the third quarter with 783 billion rupiah new liabilities but will improve to -2,481 billion rupiah in12 months time.
- At the current market value of 2,010 billion rupiah based on our forecasts it’s at 0.30 X assets with a 50 years payback & a 0% yield.
- Our 12 month cashflow forecast is 127 billion rupiah which means an 16 X valuation. A 15 X valuation gives a -5% lower target price of 110 rupiah.