Big Lots, Inc. (BIG) Fundamental Valuation Report

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Larry Fink,Laurence Fink, BlackRock, Inc., world's largest asset manager, American multinational investment management corporation, American financial executive, CEO, Chairman, Barclays Global Investors, assets under management, alternative investments, Wall Street, BLK, Hedge funds, valuewalk, ETFs, ishares, robo-investing, robo analysts, quant fundsBlackRock CEO Laurence Fink spoke at Morningstar's recent conference, and he talked about a variety of things, like his concerns about company culture at a time when all the firm's employees are working at home. Despite those concerns, he doesn't think BlackRock will ever be 100% working in the office. He thinks employees will always Read More

Valuation Summary:

Big Lots $42.33 (USD) Close Price as of 30/05/2018

Based on the analysis conducted in this report, Big Lots, (BIG:NYS) is found to be  Undervalued.

Big Lots, Inc. (BIG)

Valuation Details

Big Lots, Inc. (BIG)

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 BIG:NYS

Using a discounted cash flow model we generated an intrinsic value of $91.26 (USD) for BIG:NYS

Sensitivity Analysis

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

Big Lots, Inc. (BIG)

Comparables Model

Using similar companies and price based ratios we generated a valuation of $75.97 (USD) for Big Lots, Inc. (BIG). We also generated a valuation of $76.81 (USD) using other metrics and comparables. The comparable companies were Ollie's Bargain Outlet (OLLI:NAS) and Pricesmart (PSMT:NAS)

Big Lots, Inc. (BIG)


Using a multiples approach we generated a valuation of  $57.24 (USD) for BIG:NYS

Big Lots, Inc. (BIG)

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  BIG:NYS for the last 10 years was  3.39
We ran the Adjusted Book Value for  BIG:NYS and generated a book value of  $15.97 (USD) By multiplying these we get an adjusted valuation of  $54.21 (USD)

Analyst Data

Big Lots, Inc. (BIG)

Company Overview (BIG:NYS USD)

Big Lots, Inc. (BIG)

Detailed Company Description

Big Lots Inc is engaged in operating discount retail stores. It provides a broad range of merchandise, including food, consumables, soft home products, hard home products, furniture, electronics and accessories, and seasonal products.

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.