This document provides financial projections and valuation metrics for Brunswick Corporation and several peers. It includes estimates of revenue and EBITDA growth for Brunswick from 2014 to 2018 under analyst, conservative, base, and optimistic scenarios. It also shows discounted cash flow analyses for Brunswick using a range of terminal growth and EBITDA multiple assumptions. The document indicates Brunswick currently trades at a premium or discount to peer median valuation metrics.
In 2018, I sold a two-unit restaurant concept called Big Buns to the largest minority-owned contract food service company in the United States. The first location was delivered to me as a cold dark shell in a poorly located nine-story office building with a parking garage below. If you are ever considering putting a restaurant in a retail location that matches this description, please walk away now. The tenant improvement package was sizable, but ended up being insignificant after retrofitting a poorly planned retail space in a brand-new building with a restaurant. This project ended up costing roughly $425 a square foot to build-out – an $868k investment spread out over 2,042 square feet.
In 2018, I sold a two-unit restaurant concept called Big Buns to the largest minority-owned contract food service company in the United States. The first location was delivered to me as a cold dark shell in a poorly located nine-story office building with a parking garage below. If you are ever considering putting a restaurant in a retail location that matches this description, please walk away now. The tenant improvement package was sizable, but ended up being insignificant after retrofitting a poorly planned retail space in a brand-new building with a restaurant. This project ended up costing roughly $425 a square foot to build-out – an $868k investment spread out over 2,042 square feet.
IOC BINARIO DXN PLAN DE PAGOS SIN CANDADOS RUMBO A LA LIBERTADLeo Pacheco
WHATSAPP +57 3007570227
EL PLAN DE PAGOS DXN ES EL MAS CONFIABLE Y RENTABLE ADEMAS DE ESTABLE, PUEDES HACERLO DE LA FORMA QUE QUIERAS ESTE ES UN EJEMPLO BINARIO, PERO REALMENTE EL PLAN DE PAGOS IOC DE DXN ES SIN CANDADOS, FRONTALIDAD Y PROFUNDIDAD ILIMITADA, GANAS AUNQUE NO HAGAS RECOMPRAS Y SOLO POR CAMBIAR TU MARCA DE CAFÉ POR UN CAFÉ SALUDABLE CON GANODERMA.
5YR Equity ValuationNOTE Rule of thumb - 20 growth in forecast o.docxevonnehoggarth79783
5YR Equity ValuationNOTE: Rule of thumb - 20% growth in forecast of 5 years; 80% residualSelect Market Prices and Other InformationForecast Period Information (Years 1-5)Last Year's Revenue$ 3,392,000,000.00Shares Outstanding100,291,843Revenue Growth Rate 3% then 2%Debt Outstanding (assume book value = market value)$ 685,003,000.00Operating Margin (including depreciation expense)18%Cash and Marketable Securities$ 2,066,000,000.00Incremental Investment in Operating Capital10%WACC6.1%Tax Rate6%Instructions: Calculate the Stock Price based on the given assumptions and under 3 long term growth scenariosNO GROWTHFORCAST YEARSYear 1Year 2Year 3Year 4Year 5Year 6Revenue3,493,760,0003,598,572,8003,706,529,9843,780,660,5843,856,273,7953,933,399,271 Costs2,864,883,2002,950,829,6963,039,354,5873,100,141,6793,162,144,5123,225,387,402EBIT628,876,800647,743,104667,175,397680,518,905694,129,283708,011,869 Taxes35,594,42736,662,26037,762,12738,517,37039,287,71740,073,472NOPAT593,282,373611,080,844629,413,270642,001,535654,841,566667,938,397 Incremental Investment in Operating Capital59,328,23761,108,08462,941,32764,200,15465,484,1570%Perpetuity Cash Flow (forever and ever cash flows)FCF533,954,136549,972,760566,471,943577,801,382589,357,409667,938,39710,956,897,959.88PV FCF503,274,266488,587,912474,330,129456,017,650438,412,162496,867,117No Growth Strategy (Year 6 expected growth rate = 0% and WACC = ROIC)PV of Forecast2,360,622,118PV of Residual or Terminal Value8,150,635,3301) fcf yr 6 (given) 2) perp formula 3) /1+I (wacc)Perp= (fcf YR 6/wacc-g)10,956,897,959.88PV of All Future Cash Flows10,511,257,448add fcf all 6 yearsCash and Marketable Securies2,066,000,000Corporate Valuation12,577,257,448Value of Debt685,003,000Value of Equity Holders11,892,254,448Value per Equity Share118.58GROWTHFORCAST YEARSYear 1Year 2Year 3Year 4Year 5Year 6Revenue3,493,760,0003,598,572,8003,706,529,9843,780,660,5843,856,273,7953,933,399,271 Costs2,864,883,2002,950,829,6963,039,354,5873,100,141,6793,162,144,5123,225,387,402EBIT628,876,800647,743,104667,175,397680,518,905694,129,283708,011,869 Taxes35,594,42736,662,26037,762,12738,517,37039,287,71740,073,472NOPAT593,282,373611,080,844629,413,270642,001,535654,841,566667,938,397 Incremental Investment in Operating Capital59,328,23761,108,08462,941,32764,200,15465,484,157136,313,958.588%FCF166,860,000171,865,800177,021,774180,562,209184,173,454531,624,438PV FCF155,218,605148,721,082142,495,548135,205,078128,287,609145,392,624Growth Strategy (Year 6 expected growth rate = 2% and ROIC = 9.8%)PV of Forecast709,927,921PV of Residual or Terminal Value9,654,796,5761) fcf yr 6 (given) 2) perp formula 3) /1+I (wacc)Perp= (fcf YR 6/wacc-g)12,978,941,717PV of All Future Cash Flows10,364,724,497add fcf all 6 yearsCash and Marketable Securies2,066,000,000Corporate Value12,430,724,497Value of Debt685,003,000Value of Equity Holders11,745,721,497Value per Equity Share 117.12
10YR Equity Valuation NOTE: Rule of thumb - 20% growth in.
20. Latest Holders
Holder Common Stock Equivalent Held % Of CSO Market Value (USD in mm) Position Date
T. Row e Price Group, Inc. (NasdaqGS:TROW) 7,358,111 7.916 351.1 Sep-30-2014
BlackRock, Inc. (NYSE:BLK) 7,174,420 7.718 342.4 Sep-30-2014
Fidelity Investments 5,944,993 6.396 283.7 Sep-30-2014
The Vanguard Group, Inc. 5,647,282 6.075 269.5 Sep-30-2014
Robeco Group N.V. 4,902,264 5.274 233.9 Sep-30-2014
WEDGE Capital Management L.L.P. 3,327,695 3.58 158.8 Sep-30-2014
State Street Global Advisors, Inc. 3,110,169 3.346 148.4 Sep-30-2014
Invesco Ltd. (NYSE:IVZ) 2,753,893 2.963 131.4 Sep-30-2014
Daruma Capital Management, LLC 1,980,032 2.13 94.5 Sep-30-2014
Barrow , Hanley, Mew hinney & Strauss, Inc. 1,919,159 2.065 91.6 Sep-30-2014
1832 Asset Management L.P. 1,757,719 1.891 83.9 Sep-30-2014
Chartw ell Investment Partners, L.P. 1,657,209 1.783 79.1 Sep-30-2014
Franklin Resources Inc. (NYSE:BEN) 1,560,300 1.679 74.5 Sep-30-2014
Northern Trust Global Investments 1,500,927 1.615 71.6 Sep-30-2014
Pyramis Global Advisors, LLC 1,243,750 1.338 59.4 Sep-30-2014
Schroder Investment Management Limited 1,157,600 1.245 55.2 Sep-30-2014
Goldman Sachs Asset Management, L.P. 994,665 1.07 47.5 Sep-30-2014
Teachers Insurance and Annuity Association College Retirement Equities
Fund
952,071 1.024 45.4 Sep-30-2014
21.
22. Deal TypeAnnounce DateTarget NameAcquirer NameSeller NameAnnounced Total Value (mil.)Payment TypeTV/EBITDADeal StatusM&A5/29/2013Smithfield Foods IncWH Group Ltd6955.21Cash9.35CompletedM&A5/21/2012HealthCare Partners Holdings LLCDaVita HealthCare Partners Inc4459.19Cash and Stock CompletedM&A11/12/2012Jefferies Group LLCLeucadia National Corp2639.39Stock2.65CompletedM&A6/23/2014Central Garden and Pet CoHarbinger Group Inc992Cash13.07TerminatedM&A1/6/2014Stream Global Services IncConvergys CorpAyala Corp,Ares Management LLC (Fund: Ares Corporate Opportunities Fund II LP),Providence Equity Partners Inc (Fund: Providence Equity Partners VI LP)820Cash CompletedM&A6/18/2012Bluegreen CorpDiamond Resorts Parent LLC777.89Cash23.66TerminatedM&A10/23/2012Intown Hospitality Investors LPStarwood Capital Group LLCKimco Realty Corp735Cash CompletedM&A5/21/2013Philip Morris Mexico SA de CVPhilip Morris International IncGrupo Carso SAB de CV700Cash CompletedM&A7/29/2014New Breed Holding CoXPO Logistics Inc615Undisclosed CompletedM&A7/17/2013Lincoln Benefit Life CoResolution Life Holdings IncAllstate Corp/The600Undisclosed CompletedM&A8/26/2013TMS International CorpPritzker Organization534.82Cash3.68CompletedM&A9/16/201356 skilled nursing facilitiesOmega Healthcare Investors IncArk Holding Co525Cash CompletedM&A4/14/2014Wood Preservation & Railroad Services businessesKoppers Holdings IncOsmose Holdings Inc460Cash CompletedINV6/25/2014Masin-AES Pte LtdElectricity Generating PCLAES Corp/VA453Cash CompletedM&A11/5/2012US conventional oil & gas assetsHarbinger Group IncEXCO Resources Inc372.5Cash CompletedM&A6/30/2013WilcoHess LLCHess CorpAT Williams Oil Co290Cash CompletedM&A2/28/2014Certain AssetsHomefed CorpLeucadia National Corp277.22Stock CompletedINV3/18/2014Harbinger Group IncLeucadia National Corp253Cash2.75CompletedM&A12/15/2013Hard Rock Hotel & CasinoTwin River Worldwide Holdings IncLeucadia National Corp250Cash CompletedM&A4/7/2014Tropical Shipping & Construction LtdSaltchuk Resources IncAGL Resources Inc220Cash CompletedM&A1/22/2014St Regis Bal Harbour ResortAl Faisal Holding CoStarwood Hotels & Resorts Worldwide Inc213Cash CompletedINV10/11/2013ShopRunner IncAmerican Express Co,Alibaba Group Holding Ltd,Kynetic LLC206Cash CompletedSPIN2/1/2013Crimson Wine Group LtdShareholdersLeucadia National Corp201.46 CompletedM&A10/20/2014WesTower Communications IncMasTec IncExchange Income Corp199Cash CompletedINV9/27/2013Harbinger Group IncLeucadia National Corp139.78Cash1.16CompletedM&A11/26/2012Cimarron Energy Holding Co LLCCurtiss-Wright Corp135.1Cash CompletedM&A7/24/2014WJRT-TV & WTVG-TV stationsGray Television IncSJL Holdings LLC128Cash CompletedM&A10/6/2014Compass Production Partners LPHarbinger Group IncEXCO Resources Inc118.75Cash CompletedINV11/6/2013National Bank Holdings CorpNational Bank Holdings Corp100.3Cash CompletedM&A5/9/2014Turf & ornamental businessKoch Industries IncAgrium Inc85Cash CompletedM&A5/15/2013EF&A Funding LLCAres Commercial Real Estate CorpAlliant Co LLC/The62.69Cash and Stock CompletedINV5/2/2013Proteus Digital Health IncOracle Corp,Private Investor,Otsuka Holdings Co Ltd,Novartis BioVentures Ltd (Fund: Novartis Option Fund),Sino Portfolio International Ltd 62.5Cash CompletedINV4/30/2014Ambri IncTotal SA,Private Investor,Khosla Ventures LLC,KLP Enterprises LLC35Cash CompletedM&A9/30/2013Frederick's of Hollywood Group IncBank of New York Mellon Corp/The,Harbinger Group Inc,Tokarz Investments LLC,TTG Apparel LLC,Arsenal Group LLC 24.76Cash CompletedM&A2/10/2014ICG Addcar Systems LLCUGM Holdings Pty LtdArch Coal Inc21Cash CompletedINV10/27/2014iMATCHATIVE IncWells Fargo & Co,Investor Group,Inmobiliaria Carso SA de CV20Cash CompletedINV8/21/2013Backplane Inc/TheCoca-Cola Enterprises Inc,Menlo Ventures,Google Ventures,SV Angel,Founders Fund Management LLC (Fund: FF Angel LLC),Groupe Cirque du Soleil Inc,Tomorrow Ventures LLC,Lerer Hippeau Ventures Management LLC (Fund: Lerer Ventures II LP) 12Cash CompletedM&A7/5/2013Certain AssetsGarvey Group LLC/TheSchawk Inc10.2Cash and Debt CompletedM&A2/19/2013Empire Insurance CoWhite Mountains Insurance Group LtdLeucadia National Corp3.2Cash CompletedM&A5/9/2013CMBS Special Servicing BusinessKeyCorpLeucadia National CorpN/ACash CompletedM&A6/19/2013Paper and print media products business in WesternSequana SAXerox CorpN/ACash CompletedM&A5/28/2014Keystone Commercial Capital Ca IncLeucadia National CorpN/AUndisclosed CompletedM&A10/1/2013Peak Oilfield Services CoBristol Bay Native CorpNabors Industries LtdN/AUndisclosed CompletedM&A8/7/2013Eastern Associated TerminalCSX CorpIngram Industries IncN/ACash CompletedM&A2/19/2014Headliner and sun visor businessAtlas Holdings LLCJohnson Controls IncN/ACash CompletedM&A1/7/2013Masco Framing CorpAtlas Holdings LLCMasco CorpN/AUndisclosed CompletedM&A9/18/2014Eagle Ford Shale oil & gas leasesLeucadia National CorpN/ACash CompletedM&A2/11/2013Certain Roadbuilding assets and operationsFayat SASTerex CorpN/ACash CompletedM&A8/23/2013Property Claims Services IncT&H Global Holdings LLCSolera Holdings IncN/AUndisclosed CompletedM&A12/4/2013Footman James UK LtdTowergate Insurance LtdAon PLCN/AUndisclosed CompletedINV2/5/2014DataMentors Holdings IncAffiliated Managers Group Inc,Clear Choice Financial Inc,Brook Venture PartnersN/ACash CompletedINV7/14/2014CorAmerica Capital LLCHarbinger Group IncN/AUndisclosed CompletedM&A8/25/2014Sun Catalytix CorpLockheed Martin CorpTata Group,Polaris Venture Partners (Fund: Polaris Venture Partners V LP)N/AUndisclosed CompletedM&A6/25/2014Retirement services recordkeeping businessAmerican United Mutual Insurance Holding CoCity National Corp/CAN/ACash CompletedM&A11/10/2014xpient Solutions LLCHeartland Payment Systems IncN/AUndisclosed Completed
23. Deal AttributeTarget Multiples# DealsMin - MaxMedianMinMaxMean Free Cashflow47.18 - 33.3718.4 x7.1833.3720.3 x Income B/F XO53.88 - 37.8416.4 x3.8837.8420.9 x Net Income43.81 - 37.8415.5 x3.8137.8420.8 x Net Income + Deprec61.77 - 30.1013.6 x1.7730.115.9 x EBIT71.79 - 37.968.9 x1.7937.9619.9 x Cashflow from Ops.72.36 - 40.275.0 x2.3640.2721.3 x EBITDA71.16 - 23.663.7 x1.1623.6612.4 x Book Value8.98 - 4.971.9 x0.984.973.0 x Market Cap8.92 - 5.771.8 x0.925.773.3 x Stockholder Eqty8.70 - 2.511.8 x0.72.511.6 x Enterprise Value8.15 - 1.200.6 x0.151.20.7 x Total Assets9.04 - .900.5 x0.040.90.5 x Revenue8.23 - 2.440.5 x0.232.441.3 xPremiums Paid# DealsVolumePercent 25.01-50%26.98B28%28% 10.01-25%44.94B20%20%
25. WACC Analysis
($ in millions, except per share data)
Discount Rate Calculation - Assumptions
Risk-Free Rate: 2.4%
Equity Risk Premium: 7.0%
Interest Rate on Debt: 6.2% LIBOR + 225 basis points
Comparable Companies - Unlevered Beta Calculation
Levered Equi ty Unlevered
Name Beta Debt Value Tax Rate Beta
Polaris Industries Inc. 1.16 $ 288 $ 8,806 33.7% 1.14
HARLEY-DAVIDSON, INC. 1.25 5,259 14,261 34.1% 1.01
Hasbro, Inc. 0.84 1,397 6,550 19.3% 0.72
MATTEL, INC. 1.02 1,604 14,949 17.8% 0.94
THOR INDUSTRIES, INC. 0.89 - 2,792 30.6% 0.89
BRP Inc. 0.44 795 3,112 49.0% 0.39
Median 0.96 0.91
Brunswick Corporation 1.56 $ 460 $ 4,096 34%
Brunswick Corporation - Levered Beta & WACC Calculation
Unlevered Equi ty Levered
Beta Debt Value Tax Rate Beta
Brunswick Corporation 0.91 $ 460 $ 4,096 34% $ 0.98
Cost of Equity Based on Comparables: 9.3%
Cost of Equity Based on Historical Beta: 13.3%
WACC 8.7%
WACC = Cost of Equity * % Equity + Cost of Debt * % Debt *
(1 - Tax Rate) + Cost of Preferred Stock * % Preferred Stock
26. Capitalization Table
Consolidated Market Cap 4,417
- Cash and Short Term 624
+ Short Term Debt 4
+ Long Term Debt 452
+ Preferred Stock -
+ Minority Interest -
= Enterprise Value 4,249
Multiples Range Implied Price
Publ ic Company Comparables: Low High Metric Low High
LTM EV / Revenue 1.9 x 2.0 x $3,801.60 $79.28 $ 84.55
FY1 EV / Revenue 1.9 x 2.0 x $3,824.08 $79.79 $83.73
LTM EV / EBITDA 11.9 x 12.2 x $414.60 $54.85 $56.12
FY1 EV / EBITDA 10.6 x 10.9 x $440.55 $51.90 $53.38
LTM P / E 18.1 x 22.8 x $222.20 $44.96 $56.29
FY1 P / E 16.4 x 17.0 x $280.70 $51.44 $53.22
Discounted Cash Flow
DCF Multiples Method (7-11%, 6.0-14.0 x) $59.63 $71.54
DCF Gordon Growth (7-11%, 1-5% Growth) $46.28 $59.78
Precedent Transac tion Analysis
EV / Net Income 15.5x 20.8x $281 $48.50 $64.66
EV / FCF 18.4x 20.3x $339 $68.75 $75.73
EV / Net Income + Dep 13.6x 15.9x $368 $55.62 $64.81
SOTP and Analyst Price Targets
SOTP Valuation $75.85 $79.05
Analyst Price Targets $46.00 $59.00
Balance Sheet Adjustment 168.00
Outstanding Shares 93.00
27. Marine EnginesCompany NameExchange:TickerIndustry ClassificationsMarket Cap ($$ mm)TEV/Forward Total RevenueTidewater Inc. (NYSE:TDW)NYSE:TDWMarine 1,767.8 2.1 xSEACOR Holdings Inc. (NYSE:CKH)NYSE:CKHMarine 1,369.5 1.4 xInternational Shipholding Corp. (NYSE:ISH) NYSE:ISHMarine (Primary) 121.3 1.2 xScorpio Bulkers Inc. (NYSE:SALT)NYSE:SALTMarine (Primary) 477.0 2.4 xMean1.8 xMedian1.7 xBoatsCompany NameExchange:TickerIndustry ClassificationsMarket Cap ($$ mm)TEV/Forward Total RevenueQingdao Port International Co., Ltd. (SEHK:6198) SEHK:6198Commercial Marine Crafts 2,200.0 1.6 xChina Fishery Group Limited (SGX:B0Z) SGX:B0ZCommercial Marine Crafts 457.1 2.4 xSwiber Holdings Limited (SGX:AK3)SGX:AK3Commercial Marine Crafts 153.0 1.8 xMaridive & Oil Services SAE (CASE:MOIL) CASE:MOILCommercial Marine Crafts 331.8 2.4 xPan-United Corporation Ltd (SGX:P52) SGX:P52Commercial Marine Crafts 370.2 0.9 xASL Marine Holdings Ltd. (SGX:A04)SGX:A04Commercial Marine Crafts159.91.44Mean1.8 xMedian1.7 xFitnessCompany NameExchange:TickerIndustry ClassificationsMarket Cap ($$ mm)TEV/Forward Total RevenueTube Investments of India Limited (BSE:504973) BSE:504973Fitness Equipment 1,023.7 2.2 xAmer Sports Corp. (HLSE:AMEAS)HLSE:AMEASFitness Equipment (Primary) 2,420.2 1.1 xFolli Follie S.A. Commercial Industrial and Technical Company (ATSE:FFGRP) ATSE:FFGRPFitness Equipment 2,396.2 1.9 xNautilus Inc. (NYSE:NLS)NYSE:NLSFitness Equipment (Primary) 402.9 1.3 xEscalade Inc. (NasdaqGM:ESCA)NasdaqGM:ESCAFitness Equipment (Primary) 187.1 1.4 xMean1.6 xMedian1.4 x
29. 0
10
20
30
40
50
60
70
BMO CapitalMarkets
SunTrustRobinsonHumphrey
Robert W. Baird & Co
Wells FargoSecurities
LongbowResearch
WunderlichSecurities
EVA Dimensions
RBC CapitalMarkets
KeyBanc CapitalMarkets
Raymond James
B Riley & Co
Brokers' Target Price
BrokerAnalystRecommendationTargetDateBMO Capital MarketsGERRICK L JOHNSONoutperform53.0021-Nov-14SunTrust Robinson HumphreyMICHAEL A SWARTZbuy55.0019-Nov-14Robert W. Baird & CoCRAIG R KENNISONoutperform54.0019-Nov-14Wells Fargo SecuritiesTIMOTHY A CONDERoutperform18-Nov-14Longbow ResearchDAVID S MACGREGORbuy50.0018-Nov-14Wunderlich SecuritiesROMMEL DIONISIObuy57.0017-Nov-14EVA DimensionsCRAIG STERLINGbuy14-Nov-14RBC Capital MarketsJOSEPH SPAKsector perform46.0024-Oct-14KeyBanc Capital MarketsSCOTT W HAMANNbuy55.0024-Oct-14Raymond JamesJOSEPH D HOVORKAstrong buy51.0024-Oct-14B Riley & CoJIMMY BAKERbuy59.0024-Oct-14
30. Holder NamePositionPosition ChangeMarket Value% of OwnershipReport DateSourceMCCOY DUSTAN E508,88424,283,9440.55%5/6/2014Form 4STAYER RALPH C90,8381,5254,334,7890.10%10/31/2014Form 4FERNANDEZ MANUEL A75,3391,7873,595,1770.08%10/31/2014Form 4ARCHIBALD NOLAN D75,1242063,584,9170.08%10/31/2014Form 4METZGER WILLIAM L71,7873,425,6760.08%3/4/2014Proxy
31. Ownership Statistics
Shares Outstanding (M) 92.4
Float 98.6%
Short Interest (M) 3.7
Short Interest as % of Float 4.07%
Days to Cover Shorts 2.57
Ownership (Institutional) 104.94%
Ownership (Retail & Other) -6.33%
Ownership (Insider) 1.39%
93%
-6% 1%
Ownership Type
Ownership (Institutional)
Ownership (Retail & Other)
Ownership (Insider)
Geographic Ownership Distribution
United States 92.59%
Canada 2.37%
Britain 2.09%
Unknown Country 1.31%
Norway 0.75%
Switzerland 0.35%
Japan 0.17%
Others 0.36%
Institutional Ownership Distribution
Investment Advisor 81.94%
Hedge Fund Manager 12.29%
Pension Fund (Erisa) 1.96%
Individual 1.31%
Others 2.51%
93%
3%
2%
1%
1%0% 0%
0%
Geographic Ownership
United States Canada
Britain Unknown Country
Norway Switzerland
Japan Others
82%
12%
2%
1% 3%
Institutional Ownership
Investment Advisor Hedge Fund Manager
Pension Fund (Erisa) Individual
Others