Published on 19 Jun 2024 on Simply Wall St. · via Yahoo Finance
Yancoal Australia Ltd (ASX:YAL) Shares Could Be 30% Below Their Intrinsic Value...
Key Insights
Using the 2 Stage Free Cash Flow to Equity, Yancoal Australia fair value estimate is AU$8.63Current share price of AU$6.00 suggests Yancoal Australia is potentially 30% undervaluedIndustry average discount to fair value of 44% suggests Yancoal Australia's peers are currently trading at a higher discount
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Yancoal Australia Ltd (ASX:YAL) as an investment opportunity by taking the expected future cash flows and discounting them to their present value. One way to achieve this is by employing the Discounted Cash Flow (DCF) model. Believe it or not, it's not too difficult to follow, as you'll see from our example!