Brown Forman Valuation
| BF-B Stock | USD 49.01 0.38 0.77% |
At this time, the firm appears to be undervalued. Brown Forman shows a prevailing Real Value of $60.92 per share. The current price of the firm is $49.01. Our model approximates the value of Brown Forman from analyzing the firm fundamentals such as Profit Margin of 0.23 %, return on equity of 0.31, and Current Valuation of 26.15 B as well as examining its technical indicators and probability of bankruptcy. In general, most investors favor taking in undervalued instruments and trading overvalued instruments since, at some point, asset prices and their ongoing real values will blend. Key fundamental drivers impacting Brown Forman's valuation include:
Price Book 7.1978 | Enterprise Value 26.2 B | Enterprise Value Ebitda 18.476 | Price Sales 5.5364 | Forward PE 24.8756 |
Undervalued
Today
Please note that Brown Forman's price fluctuation is very steady at this time. Calculation of the real value of Brown Forman is based on 3 months time horizon. Increasing Brown Forman's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for Brown Forman is useful when determining the fair value of the Brown stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of Brown Forman. Since Brown Forman is currently traded on the exchange, buyers and sellers on that exchange determine the market value of Brown Stock. However, Brown Forman's intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value. | Historical | Market 49.01 | Real 60.92 | Target 69.84 | Hype 49.37 | Naive 47.66 |
The real value of Brown Stock, also known as its intrinsic value, is the underlying worth of Brown Forman Company, which is reflected in its stock price. It is based on Brown Forman's financial performance, assets, liabilities, growth prospects, management team, or industry conditions. The intrinsic value of Brown Forman's stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence Brown Forman's stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
Estimating the potential upside or downside of Brown Forman helps investors to forecast how Brown stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of Brown Forman more accurately as focusing exclusively on Brown Forman's fundamentals will not take into account other important factors: Traditionally analysts and sophisticated investors use multiple methods for valuing a cash-flow-generating entity or its stock. For example, some money managers use Brown Forman's intrinsic value based on its ongoing forecasts of Brown Forman's financial statements. In contrast, other private, professional wealth advisors use a multiplier approach by looking to relative value analysis against Brown Forman's closest peers. When choosing an evaluation method for Brown Forman, ensure it is appropriate for the firm given its current financial situation and market classification. If more than one evaluation category is relevant, we suggest using both methods to arrive at a better estimate.
Brown Forman Investments |
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Brown Valuation Trend
Knowing Brown Forman's actual value is paramount for traders to make sound investment determinations. Brown Forman's real value is not only important for the investor to make better decisions but also for a more accurate overall view of Brown Forman's financial worth over time since having this information enables investors and analysts to forecast the earnings more efficiently. Using both Brown Forman's enterprise value as well as its market capitalization is the best way to gauging the value of the company and is usually enough for investors to make market timing descisions.
Brown Market Cap
Brown Forman is number one stock in market capitalization category among related companies. Market capitalization of Consumer Staples industry is currently estimated at about 645.79 Billion. Brown Forman holds roughly 23.57 Billion in market capitalization claiming about 4% of stocks in Consumer Staples industry.Brown Forman Valuation Ratios as Compared to Competition
Comparative valuation techniques use various fundamental indicators to help in determining Brown Forman's current stock value. Our valuation model uses many indicators to compare Brown Forman value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Brown Forman competition to find correlations between indicators driving Brown Forman's intrinsic value. More Info.Brown Forman is number one stock in price to earning category among related companies. It is number one stock in price to book category among related companies fabricating about 0.19 of Price To Book per Price To Earning. The ratio of Price To Earning to Price To Book for Brown Forman is roughly 5.37 . As of April 24, 2024, Price To Book Ratio is expected to decline to 5.38. Comparative valuation analysis is a catch-all model that can be used if you cannot value Brown Forman by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Brown Forman's Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Brown Forman's earnings, one of the primary drivers of an investment's value.Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates Brown Forman's worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in Brown Forman and how it compares across the competition.
About Brown Forman Valuation
The stock valuation mechanism determines the current worth of Brown Forman on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of Brown Forman. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Brown Forman based exclusively on its fundamental and basic technical indicators. By analyzing Brown Forman's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Brown Forman's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Brown Forman. We calculate exposure to Brown Forman's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Brown Forman's related companies.| Last Reported | Projected for Next Year | ||
| Gross Profit | 2.9 B | 1.5 B | |
| Pretax Profit Margin | 0.22 | 0.19 | |
| Operating Profit Margin | 0.24 | 0.20 | |
| Net Profit Margin | 0.17 | 0.13 | |
| Gross Profit Margin | 0.53 | 0.50 |
Brown Forman Quarterly Retained Earnings |
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8 Steps to conduct Brown Forman's Valuation Analysis
Company's valuation is the process of determining the worth of any company in monetary terms. It estimates Brown Forman's potential worth based on factors such as financial performance, market conditions, growth prospects, and overall economic environment. The result of company valuation is a single number representing a Company's current market value. This value can be used as a benchmark for various financial transactions such as mergers and acquisitions, initial public offerings (IPOs), or private equity investments. To conduct Brown Forman's valuation analysis, follow these 8 steps:- Gather financial information: Obtain Brown Forman's financial statements, including balance sheets, income statements, and cash flow statements.
- Determine Brown Forman's revenue streams: Identify Brown Forman's primary sources of revenue, including products or services offered, target markets, and pricing strategies.
- Analyze market data: Research Brown Forman's industry and market trends, including the size of the market, growth rate, and competition.
- Establish Brown Forman's growth potential: Evaluate Brown Forman's management, business model, and growth potential.
- Determine Brown Forman's financial performance: Analyze its financial statements to assess its historical performance and future potential.
- Choose a valuation method: Consider the Company's specific circumstances and choose an appropriate valuation method, such as the discounted cash flow (DCF) or comparable analysis method.
- Calculate the value: Apply the chosen valuation method to the financial information and market data to calculate Brown Forman's estimated value.
- Review and adjust: Review the results and make necessary adjustments, considering any relevant factors that may have been missed or overlooked.
A single share of Brown Forman represents a small ownership stake in the entity. As a stockholder of Brown, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.
Brown Forman Dividends Analysis For Valuation
At present, Brown Forman's Dividend Yield is projected to slightly decrease based on the last few years of reporting. The current year's Dividend Paid And Capex Coverage Ratio is expected to grow to 7.54, whereas Dividends Paid is forecasted to decline to about 246.6 M. . At present, Brown Forman's Retained Earnings are projected to increase significantly based on the last few years of reporting. The current year's Earnings Yield is expected to grow to 0.05, whereas Retained Earnings Total Equity is forecasted to decline to about 3.7 B.
| Last Reported | Projected for Next Year | ||
| Dividends Paid | 434.7 M | 246.6 M | |
| Dividend Yield | 0.01 | 0.02 | |
| Dividend Payout Ratio | 0.43 | 0.40 | |
| Dividend Paid And Capex Coverage Ratio | 3.77 | 7.54 |
There are various types of dividends Brown Forman can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Brown shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Brown Forman directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When Brown pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of Brown Forman by the value of the dividends paid out.
Brown Forman Growth Indicators
Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as Brown Forman does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
| Common Stock Shares Outstanding | 480.6 M | |
| Quarterly Earnings Growth Y O Y | 1.875 | |
| Forward Price Earnings | 24.8756 |
Brown Forman Current Valuation Indicators
Valuation refers to the process of determining the present value of Brown Forman and all of its assets. It can be calculated using a number of techniques. As many analysts who try to value Brown we look at many different elements of the entity such as Brown's management, its prospective future earnings, the current market value of the company's assets, as well as its capital structure formation. Brown Forman's valuation analysis is also a process of estimating the intrinsic value of all assets and outstanding equities. There are different methodologies and models we use to develop the final Brown Forman's valuation. The techniques such as discounted cash flow and fundamental indicators such as book value per share or market capitalization are well known and widely used across most financial advisers and money managers.
Valuations are an essential part of business, for companies themselves, but also for investors. For companies, such as Brown Forman, valuations can help measure their progress and success and can help them track their performance in the market compared to others. In addition, investors can use Brown Forman's valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who the valuation is for, it essentially describes Brown Forman's worth.Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Brown Forman. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in board of governors. You can also try the Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Complementary Tools for Brown Stock analysis
When running Brown Forman's price analysis, check to measure Brown Forman's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Brown Forman is operating at the current time. Most of Brown Forman's value examination focuses on studying past and present price action to predict the probability of Brown Forman's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Brown Forman's price. Additionally, you may evaluate how the addition of Brown Forman to your portfolios can decrease your overall portfolio volatility.
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