0.3x TBV, 2.2x FCF and a 13% Shareholder Yield
A healthy business that looks dirt-cheap from every possible angle.
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Today’s set-up is one of the most compelling valuations I’ve seen so far this year.
In fact, it’s incredibly cheap from pretty much every angle you want to check it from.
First, it consistently trades at 5x the owner adjusted FCF figure, using both market cap and EV.
Not just last year, but also the 5Y average and TTM.
Next, it’s a net-net trading at just 0.3x its TBV.
The vast majority of those assets are cash or highly-liquid.
Finally, it has a total shareholder yield in the double digits over the last couple of years.
Even the 5Y average yield is almost 5%.
As always, I calculate the total yield inclusive of dividends, buybacks, dilution and SBC.
This means that we get solid downside protection from the assets, incredible cash-flows from the operating business, and 13% yield while we hold the stock.
The ownership structure is also nice and clean.
This means that insiders own a meaningful stake, but not enough to force an involuntary delisting at an absurd price.
Let’s take a look…