ViacomCBS Inc. operates as a media and entertainment company worldwide. The company operates through TV Entertainment, Cable Networks, and Filmed Entertainment segments. This week, I fundamentally analyze ViacomCBS Inc.’s stock. I review ViacomCBS’ operating segments, look at its key ratios, and derive the intrinsic value using Discounted Cash Flow (DCF) analysis and Dividend Discount Model. Since this is a long video, please feel free to use the time stamps in the video if you only wish to watch certain topics.
I review various key ratios such as Revenue, Net Income, Shares outstanding, Dividends, Payout Ratio, Free Cash Flows (FCF), Financial Leverage, Current Ratio, Debt to Equity Ratio, Return on Equity (ROE), Days Sales Outstanding (DSO), Days Inventory, Payable Period, Cash Conversion Cycle, Inventory Turnover, etc.
After taking into account ViacomCBS’ TTM free cash flow of $1,036 million figure, a 10% growth rate of FCF (growth for the next 10 years), 10% discount rate, 1.9% long term growth rate (growth from 10 year mark to perpetuity), 638 million shares outstanding, and $19,717 million of long term debt, the DCF analysis yields us an intrinsic value of $5.76 per share. When we drop the discount rate to 8.4% (which is the same as ViacomCBS’ WACC), the intrinsic value comes to $16.62 per share. Finally, if we disregard the company’s debt, then the intrinsic value comes to $47.53 per share.
0:29 Business Overview / 10-K
3:08 Key Ratios Analysis
12:53 Discounted Cash Flow Analysis / Intrinsic Value
15:24 Dividend Discount Model / Intrinsic Value
ViacomCBS’ Company Website: here.
Morningstar Key Ratios Link: here.
Useful Resources here.
About ViacomCBS: ViacomCBS Inc. operates as a media and entertainment company worldwide. The company operates through TV Entertainment, Cable Networks, and Filmed Entertainment segments. The TV Entertainment segment distributes a schedule of news and public affairs broadcasts, and sports and entertainment programming; acquires or develops, and schedules programming on the CBS Television Network that includes primetime comedies and dramas, reality, specials, kids’ programs, daytime dramas, game shows, and late night programs; produces or distributes talk shows, court shows, game shows, and newsmagazines; owns and operates 29 broadcast television stations; and operates CBS Sports Network, a 24/7 cable program service that provides college sports and related content, as well as streaming and cable subscription services. The Cable Networks segment creates and acquires programming for distribution and viewing on various media platforms, including subscription cable networks, subscription streaming, and basic cable networks. The Filmed Entertainment segment develops, produces, finances, acquires, and distributes films. The company was formerly known as CBS Corporation and changed its name to ViacomCBS Inc. in December 2019. ViacomCBS Inc. was incorporated in 1986 and is headquartered in New York, New York.
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