Veritiv Corporation operates as a business-to-business distributor of print, publishing, packaging, facility, and logistics solutions in in the United States, Canada, and Mexico. The company operates through four segments: Print, Publishing, Packaging, and Facility Solutions. The company was founded in 2014 and is based in Atlanta, Georgia.
VRTV Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Veritiv Corp. To summarize, we found that Veritiv Corp ranked in the 90th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 1446.33% on a DCF basis. The most interesting components of our discounted cash flow analysis for Veritiv Corp ended up being:
38% of the company's capital comes from equity, which is greater than just 12.61% of stocks in our cash flow based forecasting set.
The business' balance sheet suggests that 62% of the company's capital is sourced from debt; this is greater than 87.35% of the free cash flow producing stocks we're observing.
As a business, Veritiv Corp experienced a tax rate of about 1% over the past twelve months; relative to its sector (Industrials), this tax rate is higher than merely 20.16% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
YRCW, NVEE, NM, RYI, and AVHOQ can be thought of as valuation peers to VRTV, in the sense that they are in the Industrials sector and have a similar price forecast based on DCF valuation.
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In this daily bar chart of VRTV, below, we can see that prices have been trading higher since March but in a very choppy fashion. The price action since June has been more sideways than up as prices have crossed above and below the 50-day moving average line many times. The On-Balance-Volume (OBV) line shows a rise from the middle of March to early June which is positive, but then the OBV line declines telling us that sellers of VRTV have been more aggressive for several months.
ATLANTA, Nov. 16, 2020 /PRNewswire/ -- Veritiv Corporation (NYSE: VRTV) (the "Company" or "Veritiv") today announced the pricing of an underwritten public offering of 1,400,000 shares of its common stock by UWW Holdings, LLC, one of its existing stockholders and the former parent company…