SiteOne Landscape Supply (SITE:NYS) Fundamental Valuation Report

SiteOne Landscape Supply (SITE:NYS) Fundamental Valuation Report

Fundamental Valuation Report

SiteOne Landscape Supply(SITE:NYS)

Industrials:Industrial Distribution

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$172.04 (USD) 05/28/2021

Weighted Valuation
$165.24 (USD)

Overall Rating
Fairly valued to slightly Overvalued by 4.0%

Valuation Models Comparables: $144.23 (USD)
(in order of importance) Adjusted Book Value: $197.46 (USD)
Multiples: $163.83 (USD)
Valuation Methods This company is:
Cash Flow: Overvalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation
According to Analyst consensus at $145.50 this stock is Overvalued

Company Overview (SITE:NYS USD)

Price 172.04
Range 170.55 – 172.68
52 week 104.18 – 202.98
Open 172.41
Vol / Avg. 242835/380199
Mkt cap 7.64B
P/E 51.66
Div/yield 0.00/0.00
EPS 2.75
Shares 44.43M
Beta 1.21

Company Description

SiteOne Landscape Supply Inc is one of the largest suppliers of tools and equipment. The company serves various businesses which include wholesale irrigation, outdoor lighting, nursery, landscape supplies, grass seeds, and fertilizers, turf protection products, turf care equipment, and golf course accessories for green industry professionals mainly in the United States and Canada. Its product portfolio includes irrigation supplies, fertilizer and herbicides, landscape accessories, nursery goods, natural stones and blocks, outdoor lighting and ice melt products and other products.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for SITE:NYS

Using a discounted cash flow model we generated an intrinsic value of $94.73 (USD) for SITE:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

SITE:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $94.73 1% 5% 1% 5%
WACC (or Ke) 7.94 $120.87 $77.25
Terminal Growth Rate 2.90 $78.75 $118.62
Tax Rate 0.19 $101.84 $87.61
Cash Flow 358,709,400 $88.76 $100.69
Capital Expenditures -14,040,000 $94.51 $94.94
Long Term Debt 445,100,000 $95.23 $94.23

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $144.23 (USD) for SITE:NYS. We also generated a valuation of $138.69 (USD) using other metrics and comparables.
The comparable companies were Systemax (SYX:NYS), Applied Industrial (AIT:NYS), WESCO International (WCC:NYS), W.W. Grainger (GWW:NYS) and Watsco (WSO.B:NYS).

Company SITE:NYS End Date Value
Earnings/Share $3.33 (USD)
Book Value/Share $18.13 (USD)
Sales/Share $64.24 (USD)
Cash Flow/Share $5.54 (USD)
EBITDA/Share $5.48 (USD)
Price Based on Comps Adjustment Factor (%)
$128.95 (USD) 0.0
$135.99 (USD) 0.0
$88.84 (USD) 50.0
$76.81 (USD) 71.9
$104.49 (USD) 84.2
SITE:NYS Ratios Used Average Values SYX:NYS AIT:NYS WCC:NYS GWW:NYS WSO.B:NYS
51.66 PE Ratio 38.72 21.32 33.21 68.31 32.75 38.02
9.49 PB Ratio 7.50 11.03 4.07 1.57 13.26 7.57
2.68 PS Ratio 1.38 1.23 1.26 0.36 2.08 1.98
31.07 PCF Ratio 16.15 17.14 11.70 8.26 21.04 22.62
29.10 EV to EBITDA 19.06 16.13 18.77 17.68 18.23 24.50

Multiples

Using a multiples approach we generated a valuation of  $163.83 (USD) for SITE:NYS

Company SITE:NYS End Date Value
Earnings/Share $3.33 (USD)
Book Value/Share $18.13 (USD)
Sales/Share $64.24 (USD)
Cash Flow/Share $5.54 (USD)
EBITDA/Share $5.48 (USD)
Price Based on Comps Adjustment Factor
$173.74 (USD) 0
$196.78 (USD) 0
$98.09 (USD) 0
$220.69 (USD) 0
$129.87 (USD) 0
Ratios Ratio Average
PE Ratio 52.17
PB Ratio 10.85
PS Ratio 1.53
PCF Ratio 39.86
EV to EBITDA 23.70

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  SITE:NYS for the last 5 years was  10.85

We ran the Adjusted Book Value for  SITE:NYS and generated a book value of  $18.19 (USD)
By multiplying these we get an adjusted valuation of  $197.46 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for SITE:NYS. The 2 analysts have a concensus valuation for SITE:NYS for 2021 of $145.50 (USD).

SITE:NYS SiteOne Landscape Supply

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
0 0 2 1.0000 Sell 2021-5-27

Current Price: 172.04 USD

Analyst Consensus
USD Millions 2021 2022 2023
Mean EPS 3.11 3.60 3.81
# EPS Analysts 2 2 1
Mean Revenue 3,127.00 3,228.10 3,201.50
# Revenue Analysts 2 2 1
Mean Target Price 145.50
Mean Cash Flow 4.10 5.34 5.53
Mean EBITDA 311.00 322.00 348.60
Mean Net Income 156.50 164.10 173.00
Mean Debt Outstanding 109.70 -293.80
Mean Tax Rate
Mean Growth Rate
Mean Capital Expenditure 22.40 21.40 19.20

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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