CERT.V
CERRADO GOLD INCClosedCERT.V discounted cash flow valuation
CERT.V Fair Value
Reverse DCF: today's price implies 7.5% a year of FCF growth for years 1–5, against -5.0% in this model.
Model: -5.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 9.73% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | CAD 96.36M |
|---|---|
| PV of terminal value (45% of EV) | CAD 80.01M |
| Enterprise value | CAD 176.37M |
| + Cash & investments | CAD 35.99M |
| − Total debt | −CAD 89.11M |
| Equity value | CAD 123.25M |
| ÷ Shares outstanding | 138.79M |
| Value per share | CAD 0.8880 |
| Market cap | CAD 301.18M |
USD statements converted at 1.423 CAD.
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.19% |
|---|---|
| Beta (clamped 0.5–2.5) | 1.14 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 10.87% |
| Pre-tax cost of debt | 7.98% |
| Tax rate | 26.0% |
| Debt / (equity + debt) | 22.8% |
| WACC | 9.73% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 7.73% | 1.14 | 1.23 | 1.33 | 1.45 | 1.61 |
| 8.73% | 0.9447 | 1.00 | 1.07 | 1.16 | 1.25 |
| 9.73% | 0.7951 | 0.8386 | 0.8880 | 0.9448 | 1.01 |
| 10.73% | 0.6775 | 0.7101 | 0.7465 | 0.7877 | 0.8346 |
| 11.73% | 0.5824 | 0.6075 | 0.6352 | 0.6661 | 0.7007 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (TTM) | — | CAD 18.95M | — | — |
| Year 1 | -5.0% | CAD 18.00M | 0.911 | CAD 16.40M |
| Year 2 | -5.0% | CAD 17.10M | 0.831 | CAD 14.20M |
| Year 3 | -5.0% | CAD 16.25M | 0.757 | CAD 12.30M |
| Year 4 | -5.0% | CAD 15.43M | 0.690 | CAD 10.65M |
| Year 5 | -5.0% | CAD 14.66M | 0.629 | CAD 9.22M |
| Year 6 | -3.5% | CAD 14.15M | 0.573 | CAD 8.11M |
| Year 7 | -2.0% | CAD 13.87M | 0.522 | CAD 7.24M |
| Year 8 | -0.5% | CAD 13.80M | 0.476 | CAD 6.56M |
| Year 9 | 1.0% | CAD 13.93M | 0.434 | CAD 6.04M |
| Year 10 | 2.5% | CAD 14.28M | 0.395 | CAD 5.64M |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.