Copyright 2017.

The Warren Buffett Spreadsheet

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Manual input of data next to yellow colored cells

Date of analysis 10/15/2107

Datainput from Gurufocus.com
Stock ticker BBBY
Stock price 21.23
Enterprise value (Mill) (From Gurufocu.com) 4070
F-Score (From Gurufocus.com) 6
Z-score (From Gurufocus.com) 5.31
M-Score (From Gurufocus.com) -2.57
Required Margin of safety % 40%
Desired Discount Rate % 11%
20 AA Corporate bond Rate % 2.95%
Dicount Rate 10y fed note % 2.26%

Score chart

Checklist
Scores (maxratios
100%)
Valuation ratios 87%
Earnings stability
Efficiency 50%
Efficiency
Growthgrowth
rates
13%
Financial strenght 100%
Growth
Financialrates
strenght 57%
Earnings stability 58%
Efficiencyratios
Checklist growth 78%

Efficiency

Valuation ratios

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Valuation inputs
P/E 10y median Change?
13.6
3 year average free cash flow
736
5 year average free cash flow Change?
500 500
10y average free cash flow
727
Growth rates. Median
Free cash flow Change?
3.0 % 3.0 %
EPS Change?
5.0 % 5%
Book value growth rate
6.5 %
Future Expected ROE Change?
10.0 % 10%

A c t u al mar g in o f safet y v s req u ir ed mar g in o f safet y

40% Required Margin of safety %

Margin of safety
57%

0% 20% 40% 60% 80% 100%

Past 10 years valuation 1 2

P/E 13.6 14.5

P/B 3.1 2.3
P/S 1.1 0.9
P/Operating cash flow 12.7 13.7

Past 10 years data 1 2

Revenue / sales (mill) 7049 7208
Operating Income (mill) 838 674
Net Income (mill) 563 425
Earnings Per Share  2.10 1.64
Dividend per share — —
Shares outstanding (mill) 268 259
Book Value Per Share 9.9 11.0
Operating Cash Flow (mill) 615 584
Free Cash Flow (mill) 256 368
Interest Coverage — —
Current Ratio 2.05 2.69
Debt/Equity — —

Long term debt 0 0

Total equity 2651 2846
Sales/revenue per share 26.3 27.8
Operating income per share 3.1 2.6
Operating cash flow per share 2.3 2.3
Free cash flow per share 1.0 1.4
Capex 358 216
FCF margin 0.31 0.55

STDV 0.11
Average FCF margin 0.57
FCF coefficient variation 20%
10y avg EPS 3.7
10y avg FCF per share 3.5

10y avg free cash flow 713

5y avg free cash flow 769
3y avg free cash flow 641

10y avg capex 358

5y avg capex 343
3yavg capex 356

Financial strength 1 2
Y's to pay long term debt with net income 0.0 0.0
Y's pay long term debt with free cash flow 0.0 0.0
Debt/Equity — —
Current ratio 2.1 2.7
Interest coverage — —

Efficiency 1 2
FCF/Sales 4% 5%
CROIC 10% 13%
ROTC 21% 15%
ROE 22% 15%
Gross margin 42% 40%
Operating margin 12% 9%
Net margin 8% 6%
Return on retained earnings

Checklist ratios past 10 years 1 2

Dividend safety
Net income of cash flow from operation 92% 73%
Dividend payout ratio
Capex of operating cash flow 58% 37%
5 year cumulative capex of 5y cumulative net inc 42%

Earnings and growth stability past 10 years 1 2

EPS (Earnings per share) 2.10 1.64
Number of years of new high EPS
Number of years with positive EPS 1 1
Sales/revenue 7049 7208
Number of years new high revenue/sales 1
Free cash flow 256 368
Number of years of new high free cash flow
Number of years with positive FCF 1 1
Dividend — —
Number of years of new high dividend
Number of years with dividend payment 1 1
Operating income 838 674
Number of years new high operating income
Number of years with positive operating income 1 1
Operating cash flow 615 584
Number of years of new operating cash flow
Number of years with positive operating cash flow 1 1

Growth rates %. Different time periods 1y-8y 2y-9y

Free cash flow (FCF) 18.8 % 9.3 %
Sales/Revenue 7.7 % 7.7 %
EPS (Earnings per share) 13.4 % 17.6 %
Net income 7.9 % 10.2 %
Book Value per share 9.2 % 5.9 %
Operating income 9.2 % 11.2 %
Operating cash flow 9.8 % 8.2 %

Growth rates %. Different time periods 1y-8y 2y-9y

FCF/Sales 10.3 % 1.5 %
CROIC 7.4 % 3.1 %
ROTC -0.8 % 4.3 %
ROE 4.1 % 11.0 %
Gross margin -0.9 % -0.6 %
Operating margin 1.4 % 3.2 %
Net Margin 0.1 % 2.4 %

Historical valua
25

20

15

10

5
 10

0
1 2 3 4 5 6 7

Earnings grow
90

80

70

60

50

40

30

20

10

0
1 2 3 4 5 6 7

Earnings grow
Revenue / sales (mill) Operating Income (mill)
14000 1800 1638 1615
12104 12216 12168 1568 1554
12000 11504 11881 1600
10915
1400 1288
10000 9500
8759 1200
7829 981
8000 7049 7208 1000 838
6000 800 674
600
4000
400
2000 200
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Earnings Per Share  Dividend per share

6.00 0.60
5.1 5.1
5.00 4.8 4.6 0.50
4.6
4.1 3.9
4.00 0.40
3.1
3.00 0.30
2.1 2.3
2.00 1.6 0.20
 Earnings Per Share  Dividend per share
6.00 0.60
5.1 5.1
5.00 4.8 0.50
4.6 4.6
4.1 3.9
4.00 0.40
3.1
3.00 0.30
2.1 2.3
2.00 1.6 0.20

1.00 0.10

0.00 0.00
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Operating Cash Flow (mill) Free Cash Flow (mill)

1600 1200
1383 1066
1400 982
1225 1193 1000
1186 855
1200 804 838
987 1012 1042 800 752
1000 905 937

800 600
615 584
600 368
400
400 256
200
200
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Sales/revenue per share Operating income per share

90 10
81.4 84.5
80 73.4 9 8.2
8 7.6
70 62.9 7.2
60 7 6.4
54.0
47.9 6
50 5.0
38.9 5
40 33.9 3.8
30.1 4 3.1
30 26.3 27.8 3 2.6
20 2
10 1
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Efficiency
45%

40%

35%

30%

25%

20%

15%
30%

25%

20%

15%

10%

5%

0%
1 2 3 4 5 6 7

FCF/Sales CROIC
12% 30%
10% 26%
10% 10% 9% 25% 24%
9% 22%
20% 21%
8% 8% 20%
7%
16%
6% 6% 5% 15%
5% 13%
5%
4% 10%
4% 10%

2% 5%

0% 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

ROE Operating margin

35% 18% 17%
32%
30% 29% 16% 15% 15%
14%
25% 26% 25% 26% 14% 13%
13%
25% 12%
22% 21% 21% 12%
20% 18% 10% 9%
15%
15% 8%
6%
10%
4%
5% 2%
0% 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Financial stren
Y's to pay long term debt with net inc. Y's pay long term debt with F
3 3
2.7
2.5 2.5 2.2
2.2
2.0
2 1.9 2

1.5 1.5

1 1

0.5 0.5
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
2.5 2.5 2.2
2.2
2.0
2 1.9 2

1.5 1.5

1 1

0.5 0.5
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Current ratio Interest coverage

3.5 12
3.1 3.08 3.09
3 2.69 10
2.5 2.37
2.05 2.07 2.1 2.04 8
2 1.87 1.77
6
1.5
4
1

0.5 2

0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Checklist ratios &

Dividend safety Net inc of cash flow from opera
20 18.280701754386 100% 92%
18 90% 87%
80% 81% 81%
16 80% 73% 74%
12.277253668763 66%
14 1 70%
12 60%
10 50%
8 40%
6 30%
4 20%
2 10%
0 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Capex of operating cash flow Shares outstanding (mill)

70% 300
268 259 260 258
60% 58% 250
244
228
213
50% 189
200
37% 39%
40% 36%
32% 150
30% 28%
30%
23%
20% 100
20% 17% 19%

10% 50

0% 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number
 20%

10% 50

0% 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Intrinsic Valuation methods

2 Stage DCF valuation

5y average free cash flow: 500

Years: 1-3 4-7

Growth Rate: 3% 2%

Terminal Growth Rate: 2% Discount Rate:

Shares Outstanding: 144 MOS:

Year Flows Growth

1 515 3%
2 530 3%
3 546 3%
4 559 2%
5 573 2%
6 587 2%
7 601 2%
8 612 2%
9 624 2%
10 636 2%

Terminal Year 649

PV of Year 1-10 Cash Flows: 3339
Terminal Value: 5275
Total PV of Cash Flows: 8614
Number of Shares: 144
Intrinsic Value (IV): 60

Katsenelsons Absolute P/E Valuation

No Growth P/E 7
EPS Growth Rate % 5.0 % Points
Dividend Yield % 2.50% Points
Basic P/E 12.8
Business Risk 1 Adjustment
Financial Risk 0.90 Adjustment
Earnings stability 1 Adjustment
5y average EPS 4.68
Current Stock Price 21.23
Fair Value P/E 14.1
Intrinsic Value 66
Benjamin Grahams Growth Formula
Normalized EPS Using The ROE Method:
10y median ROE 10.0 %
Shareholders Equity (TTM) 2736
Normalized Net Income 274
Shares Outstanding 144
Normalized EPS 1.90
Normalized EPS Using The Net Margin Method:
10 Year Average Net Profit Margin 7.7 %
Revenue (TTM) 12168
Normalized Net Income 936
Normalized EPS 6.50
Average Normalized EPS 4.20
20y AA Corp Bond Rate 2.95
Estimated Future EPS Growth Rate 5.00
Current Stock Price 21.23
Intrinsic Value 79

Classic Value investors valuation Year

Current Stock Price 21.23 1
5 year average EPS 4.68 2
Dividend pay out ratio 11% 3
EPS growth rate (1st five years) 5.0 % 4
EPS Growth Rate (2nd Five Years) 4.0 % 5
Discount Rate 11% 6
P/E Ratio in 10 Years ( 10y median p/e ratio) 13.6 7
8
9
10

Value of Future Dividends Today 3.80 Year

Value of Future Sales Price Today 34.80 10
Intrinsic Value Of The Stock 39

P/E valuation
5y average EPS 4.68
Average historical P/E 13.6
EPS growth rate 5%
Growth decline rate 2%
Discount rate 11%

Year EPS*Growth rate

1 4.92
2 5.16
3 5.40
4 5.66
5 5.92
6 6.19
7 6.46
8 6.74
9 7.03
10 7.32
Value in 10 years 100
Intrinsic Value 35

Book value growth + Dividend valuation

Current Stock Price 21.23
Annual Dividend 0.53
Years Of Future Value Calculation 10
Discount Rate - 10 yr. Fed Note 2.26%
Future Book Value 68
Book Value Growth Rate 6.5 %
Book value growth adjusted for share buybacks 13.7 %
Current Year Book Value 19.00
Intrinsic Value 59

Projected Annual Compounding Return

10y Median Return On Equity 10.0 %
Percentage Of Earnings Retained 89%
Estimated Book Value Growth 6.5 %
Number Of Years 10
Present Book Value 19.00
Future Book Value -36
Converting Percentage To Decimal 0.100
Future Per Share Earnings 3.6
Terminal value 49
Intrinsic Value 17

ROE valuation
Shareholders equity (TTM) 2736
Current stock Price 21.23
10y median Return on Equity (avg) 10.0 %
Shares outstanding 144
Dividend Yield 2.50%
Dividend payout ratio 11%
Desired Margin of Safety 40%
Conservative growth rate 5.3 %
Discount rate 11%

Calculations (per share)

Year Total Equity Dividend
1 20.01 0.56
2 21.08 0.59
3 22.21 0.62
4 23.40 0.65
5 24.64 0.69
6 25.96 0.72
7 27.35 0.76
8 28.81 0.80
9 30.35 0.85
10 31.97 0.89
Year 10 EPS 3.20
Required value 29.06
NPV required value 10.23
NPV dividends 5.58
Intrinsic value: 16

Keynumbers used in watchlist Ticker Date

BBBY 10/15/2107
Market cap (mill) 3057 Valuation methods
3 stage DCF

Intrinsic value 49 Katsenelsons absolute p/e

Buyprice 29 B.Graham Formula

Margin of safety 57% Classic Value Valuation

Total quality score 58% P/E Valuation

Company Quality Very good Book Value I.V

Buy/hold/sell? Buy Projected compounding

ROE Valuation
Median
Share buybacks Data
10y 7.1 % Valuation ratios
5y 9.6 % P/E
3y 9.5 % P/E Yield
1y 4.2 % P/B
P/S
P/operating cash flow
Growth rates Median Shiller P/E
FCF (Free cash flow) 6% P/Operating income
Sales/revenue 8% Operating income/p yield
EPS (Earnings per share) 15% EV/Operating income
Book value growth 7% Operating income/EV yield
Operating income 9% EV/FCF
Operating cash flow 7% FCF/Enterprise yield
Dividend 10y growth P/FCF
FCF/price yield
Dividend yield
Earnings stability 10y Data Shareholders Yield
Years of EPS Growth 7 Peter Lynch PEG ratio
Y's of positive EPS 11 Warren Buffets's ratio
Y's of revenue growth 9
Y's of FCF Growth 4 Efficiency
Y's of positive FCF 11 FCF/Sales
Y's of dividend growth 11 CROIC
Y's of dividend paid 11 ROTC
Y's of oper. inc. growth 4 ROE
Y's of pos.operating inc. 11 Gross margin
Y's of O.C.F growth 4 Operating margin
Y's of positive O.C.F 11 Net margin
FCF covariation 20% Return on retained earnings
 Financial strength
Efficiency growth Median Y's to pay debt with net.Inc
FCF/Sales -2.1 % Y's to pay debt with FCF
CROIC -0.6 % Debt/Equity
ROTC 0.7 % Current ratio
ROE 7.0 % Interest coverage
Gross Margin -1.0 % F-Score
Operating margin 1.1 % Z-Score
Net margin 0.6 % M-Score

Checklist ratios
Dividend safety
Net Inc of cash from operation
Dividend payout ratio
Capex of operating cash flow
Cum. capex of Cum. net inc

3 4 5 6

19.5 17.5 15.6 12.9

3.0 3.3 3.6 3.2
1.3 1.5 1.5 1.3
11.5 13.3 13.0 10.2

3 4 5 6
7829 8759 9500 10915
981 1288 1568 1638
600 791 990 1038
2.30 3.07 4.06 4.56
— — — —
260 258 244 228
12.9 15.6 16.7 17.6
905 987 1225 1193
752 804 982 838
— — — —
3.10 3.08 3.09 2.37
— — — —

0 0 0 0
3362 4030 4065 4011
30.1 33.9 38.9 47.9
3.8 5.0 6.4 7.2
3.5 3.8 5.0 5.2
2.9 3.1 4.0 3.7
154 183 243 355
0.77 0.62 0.63 0.51

3 4 5 6
0.0 0.0 0.0 0.0
0.0 0.0 0.0 0.0
— — — —
3.1 3.1 3.1 2.4
— — — —

3 4 5 6
10% 9% 10% 8%
22% 20% 24% 21%
18% 21% 25% 26%
18% 21% 25% 26%
41% 41% 41% 40%
13% 15% 17% 15%
8% 9% 10% 10%

3 4 5 6

66% 80% 81% 87%

17% 19% 20% 30%

3 4 5 6
2.30 3.07 4.06 4.56
 1 2 3 4
1 1 1 1
7829 8759 9500 10915
2 3 4 5
752 804 982 838
1 2 3
1 1 1 1
— — — —

1 1 1 1
981 1288 1568 1638
1 2 3 4
1 1 1 1
905 987 1225 1193
1 2 3
1 1 1 1

3y-10y 1y-6y 2y-7y 3y-8y

-1.7 % 26.8 % 23.7 % 2.6 %
6.6 % 9.1 % 9.8 % 8.7 %
10.3 % 16.8 % 23.9 % 17.1 %
1.9 % 13.0 % 19.2 % 9.8 %
4.7 % 12.2 % 12.0 % 7.2 %
2.1 % 14.3 % 19.1 % 9.6 %
2.0 % 14.2 % 18.8 % 5.6 %

3y-10y 1y-6y 2y-7y 3y-8y

-7.7 % 16.2 % 12.7 % -5.6 %
-4.6 % 16.7 % 14.8 % -6.6 %
-1.1 % 4.4 % 11.1 % 2.0 %
5.3 % 3.7 % 10.8 % 9.7 %
-1.3 % -0.6 % -0.1 % -1.0 %
-4.2 % 4.8 % 8.5 % 0.9 %
-4.4 % 3.6 % 8.5 % 1.0 %

Historical valuation

P/E
P/B
P/S
P/Operating cash flow
 P/E
P/B
P/S
P/Operating cash flow

6 7 8 9 10 11

Earnings growth

Sales/revenue per share

Operating cash flow per share
Operating income per share
Earnings Per Share 
Free cash flow per share
Book Value Per Share
Dividend per share

6 7 8 9 10 11

Earnings growth
Operating Income (mill) Net Income (mill)
1638 1615 1200
1568 1554 1038 1022
990 957
1415 1000
1288 841
1135 791
800
981 685
957 600
600 563 565
674 425
400

200

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Dividend per share Book Value Per Share

25
0.53
20 19.4 19.0
17.6 18.3 17.9
0.38 16.7 16.4
15.6
15 12.9
11.0
9.9
10
 Dividend per share Book Value Per Share
25
0.53
20 19.4 19.0
17.6 18.3 17.9
0.38 16.7 16.4
15.6
15 12.9
11.0
9.9
10

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Free Cash Flow (mill) Free cash flow per share

6
1066
982 5.0
5 4.5
855 4.5
804 838 4.0 4.1
752 4.0
4 3.7
684 668
3.1
571 2.9
3

368 2
1.4
1.0
1

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Operating income per share Operating cash flow per share

8
8.6 6.9
8.2 7 6.5 6.5
7.6 7.6 6.3 6.1
7.2 6
6.4 6.6 5.2
5.0
5
5.0 3.8
4 3.5
3.8
3 2.3
2.6 2.3
2
1
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Efficiency

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin
 FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

5 6 7 8 9 10 11

CROIC ROTC
30%
26% 25% 26% 25%
24% 25%
22%
20% 21% 21% 21% 20%
20%
20% 18%
16% 16% 16% 17%
15%
13% 13% 15% 14%

10%

5%

0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Operating margin Net margin

17% 12%
10%
15% 15%
14% 10% 10%
13% 9% 9%
13% 8% 8%
12% 8%
8% 7%
9% 9% 6%
8% 6% 6%
5%
4%

2%

0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Financial strength
Y's pay long term debt with FCF Debt/Equity
0.585
2.6 0.58
0.58
2.2 2.3 2.2 0.575
0.57
0.565
0.56
0.555
0.55 0.55 0.55
0.55
0.545
0.54
0.0 0.0 0.0 0.0 0.0 0.0
 2.2 2.3 2.2 0.575
0.57
0.565
0.56
0.555
0.55 0.55 0.55
0.55
0.545
0.54
0.0 0.0 0.0 0.0 0.0 0.0
0.535
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Interest coverage Long term debt

2000 1903
1800
1567 1505
1600 1475
1400
1200
1000
800
600
400
200
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Checklist ratios & Misc

Net inc of cash flow from operation Dividend payout ratio
16%
87% 14%
80% 81% 81% 83% 14%
73% 74%
66% 66% 12%
60%
10%
8%
8%
6%
4%
2%
0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Shares outstanding (mill) FCF vs EPS

1200
259 260 258
244 1000 Net Income (mill)
228
213
189 800 Free Cash Flow (mill)
165
150 144 600

400

200

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number
 200

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number

ods

8-10
2%

11%

40%

Value
464
431
399
369
340
314
289
266
244
224

P/E Exp EPS Grwth Rate Dividend Yield Add'l P/E Points
7.00 0% 0.0% 0.0
7.65 1% 0.1% 0.5
8.30 2% 0.5% 0.5
3.3 8.95 3% 1.0% 1.0
2.5 9.60 4% 1.5% 1.5
10.25 5% 2.0% 2.0
10.90 6% 2.5% 2.5
1.00 11.55 7% 3.0% 3.0
12.20 8% ∆0.65 3.5% 3.5
1.10 12.85 9% 4.0% 4.0
1.00 13.50 10 % 4.5% 4.5
14.15 11 % 5.0% 5.0
14.80 12 % 5.5% 5.5
15.45 13 % 6.0% 6.0
16.10 14 % 6.5% 6.5
16.75 15 % 10.0% 10.0
17.40 16 %
17.90 17 %
18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
 15.45 13 % 6.0% 6.0
16.10 14 % 6.5% 6.5
16.75 15 % 10.0% 10.0
17.40 16 %
17.90 17 %
18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
21.90 25 %

Projected EPS Pay out ratio Dividends Disc. Divid.

4.9 11% 0.5 0.49
5.2 11% 0.6 0.46
5.4 11% 0.6 0.44
5.7 11% 0.6 0.41
6.0 11% 0.7 0.39
6.2 11% 0.7 0.37
6.5 11% 0.7 0.34
6.7 11% 0.7 0.32
7.0 11% 0.8 0.30
7.3 11% 0.8 0.28
Sum 3.80
Projected EPS PE ratio in 10 years Terminal value Disc. term. V.
7.3 13.6 98.81 34.80
NPV dividends
0.56
0.56
0.56
0.56
0.56
0.56
0.56
0.56
0.56
0.56

F-Score Z-score M-score Interest coverage (TTM)

6 5.31 -2.57 —
Intrinsic value Buyprice Margin of safety
60 36 65%
66 40 68%
79 47 73%
39 23 45%
35 21 39%
59 36 64%
17 10 -24%
16 9 -34%
49 29 55%

TTM 10y avg 5y avg

5.5 13.6 11.2
18.2 % 17.6 % 22.7 %
1.1 3.1 3.1
0.3 1.1 0.9
3.3 10.6 8.5
5.7
3.2
31.3 %
4.3
23.5 %
7.1
14.0 %
5.4
18.7 %
2.5 %
6.7 %
3.21
6.39

TTM 10y avg 5y avg

5% 7% 7%
13% 18% 19%
14% 20% 22%
21% 24% 28%
37% 40% 39%
8% 12% 13%
5% 8% 8%
4.4 %
 TTM 10y avg 5y avg
2.7 0.8 1.2
2.6 0.9 1.3
0.6 0.6 0.6
1.8 2.4 2.1
— 0 0
6
5
-2.57

TTM 10y avg 5y avg

12.3 15.3 18.3
60% 77% 78%
14% 11% 8%
39% 31% 30%
38% 42%

7 8 9 10 TTM
Visually

16.8 15.9 9.4 8.3 5.5

4.2 4.8 3.1 2.4 1.1
1.5 1.3 0.7 0.5 0.3
14.6 10.8 8.0 5.9 3.3

7 8 9 10 TTM Visually
11504 11881 12104 12216 12168
1615 1554 1415 1135 957
1022 957 841 685 565
4.79 5.07 5.10 4.58 3.87
— — — 0.38 0.53
213 189 165 150 144
19.4 18.3 16.4 17.9 19.0
1383 1186 1012 1042 937
1066 855 684 668 571
— — — — —
2.07 2.10 2.04 1.87 1.77
— 0.55 0.58 0.55 0.55

0 1903 1567 1475 1505

4132 3461 2701 2682 2736
54.0 62.9 73.4 81.4 84.5
7.6 8.2 8.6 7.6 6.6
6.5 6.3 6.1 6.9 6.5
5.0 4.5 4.1 4.5 4.0
317 331 328 374 366
0.66 0.55 0.48 0.59 0.60

7 8 9 10 TTM 10y Average

0.0 2.0 1.9 2.2 2.7 0.8
0.0 2.2 2.3 2.2 2.6 0.9
— 0.6 0.6 0.6 0.6 0.6
2.1 2.1 2.0 1.9 1.8 2.4
— — — — — 0

7 8 9 10 TTM 10y Average

9% 7% 6% 5% 5% 7%
26% 16% 16% 16% 13% 18%
25% 20% 20% 17% 14% 20%
25% 29% 32% 26% 21% 24%
40% 39% 38% 38% 37% 40%
14% 13% 12% 9% 8% 12%
9% 8% 7% 6% 5% 8%
4%

7 8 9 10 TTM 10y Average

18.3 12.3 15.3
74% 81% 83% 66% 60% 77%
8% 14% 11%
23% 28% 32% 36% 39% 31%

7 8 9 10 TTM
4.79 5.07 5.10 4.58 3.87
 5 6 7
1 1 1 1 1
11504 11881 12104 12216 12168
6 7 8 9
1066 855 684 668 571
4
1 1 1 1 1
— — — 0.4 0.5
1 2
1 1 1 1 1
1615 1554 1415 1135 957

1 1 1 1 1
1383 1186 1012 1042 937
4
1 1 1 1 1

4y-9y 5y-10y Median

-3.2 % -7.4 % 5.9 %
6.7 % 5.2 % 7.7 %
10.7 % 2.4 % 15.1 %
1.2 % -7.1 % 8.8 %
0.9 % 1.4 % 6.5 %
1.9 % -6.3 % 9.4 %
0.5 % -3.2 % 6.9 %

4y-9y 5y-10y Median

-9.2 % -12.0 % -2.1 %
-4.3 % -7.8 % -0.6 %
-0.5 % -8.0 % 0.7 %
8.7 % 0.6 % 7.0 %
-1.6 % -2.0 % -1.0 %
-4.5 % -10.9 % 1.1 %
-5.1 % -11.7 % 0.6 %

P/E
P/B
P/S
P/Operating cash flow
 P/E
P/B
P/S
P/Operating cash flow

/revenue per share

ating cash flow per share
ating income per share
ngs Per Share 
cash flow per share
Value Per Share
end per share

957
841
685
565

8 9 10 11

re

18.3 19.0
17.9
16.4
re

18.3 19.0
17.9
16.4

8 9 10 11

hare

4.5 4.5
4.1 4.0

8 9 10 11

share
6.9
6.3 6.5
6.1

8 9 10 11

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin
 FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

20% 20%
17%
14%

8 9 10 11

8%
7%
6%
5%

8 9 10 11

0.58

0.55 0.55 0.55

 0.55 0.55 0.55

8 9 10 11

1903

1567 1505
1475

8 9 10 11

tio
14%

8%

8 9 10 11

8 9 10 11
8 9 10 11
Interest coverageDebt/Equity
10y avg (TTM)
Debt/Equity 10y avg
Current ratio
Current
(TTM)ratio
Y's to10y
payavg
debt with net inc (TTM)
0 0.6 0.6 1.8 2.4 2.7
Y's to pay debt with net inc 10y avg Years to pay debt with FCF
Years
(TTM)
to pay debt with
FCF
FCF
(Free
10ycash
avg flow)
0.8 2.6 0.9 6%
 Datainput from Morningstar.com

Morningstar valuation ratios

BBBY 13.6 14.5 19.5 17.5 15.6 12.9 16.8
S&P 500 16.5 10.9 18.6 15.5 13.7 15 18.6
Price/Book
BBBY 3.1 2.3 3 3.3 3.6 3.2 4.2
S&P 500 2.7 1.7 2.2 2.2 2 2.1 2.6
Price/Sales
BBBY 1.1 0.9 1.3 1.5 1.5 1.3 1.5
S&P 500 1.5 0.9 1.2 1.3 1.2 1.3 1.7
Price/Cash Flow
BBBY 12.7 13.7 11.5 13.3 13 10.2 14.6
S&P 500 11.6 6.8 9.1 9.3 8.5 9.2 11.2

Morningstar key ratios

Revenue USD Mil 7049 7208.00 7829 8759 9500 10915 11504

Gross Margin % 41.5 39.90 41 41.4 41.4 40.2 39.7

Operating Income USD Mil 838 674.00 981 1288 1568 1638 1615

Operating Margin % 11.9 9.3 12.5 14.7 16.5 15 14

Net Income USD Mil 563 425 600 791 990 1038 1022

Earnings Per Share USD 2.1 1.64 2.3 3.07 4.06 4.56 4.79

Dividends USD — — — — — — —

Payout Ratio % * — — — — — — —

Shares Mil 268 259 260 258 244 228 213

Book Value Per Share * USD 9.89 10.99 12.93 15.62 16.66 17.59 19.4

Operating Cash Flow USD Mil 615 584 905 987 1225 1193 1383

Cap Spending USD Mil -358 -216 -154 -183 -243 -355 -317
Free Cash Flow USD Mil 256 368 752 804 982 838 1066

Free Cash Flow Per Share * USD 0.95 0.84 2.73 3.12 4.02 3.89 4.07

Working Capital USD Mil 1066 1610 2414 2751 2804 2232 1975

Morningstar profitability tab

Tax Rate % 34.95 37.78 39.1 38.8 36.95 36.49 36.64

Net Margin % 7.98 5.9 7.66 9.04 10.42 9.51 8.89

Asset Turnover (Average) 1.81 1.77 1.66 1.62 1.67 1.82 1.82

Return on Assets % 14.42 10.48 12.74 14.66 17.41 17.29 16.18

Financial Leverage (Average) 1.5 1.42 1.41 1.44 1.46 1.54 1.61

Return on Equity % 21.6 15.29 18.04 20.87 25.2 25.94 25.49

Return on Invested Capital % 20.92 15.08 17.95 20.79 25.18 25.94 25.49

Interest Coverage — — — — — — —

Morningstar financial health tab

Current Ratio 2.05 2.69 3.1 3.08 3.09 2.37 2.07

Quick Ratio 0.22 0.7 1.33 1.35 1.31 0.62 0.47

Financial Leverage 1.5 1.42 1.41 1.44 1.46 1.54 1.61

Debt/Equity — — — — — — —
Sales/revenue EPS (Earnings per share)Book valueOperating
growth Operating
incomeDividend
cash flow
10y
FCF/Sales
growth
FCF/sales
(TTM) 10y
CROIC
avg (TTM)
8% 15% 7% 9% 7% 5% 7% 13%
.com

15.9 9.4 8.3 5.5

18.6 19 20.3 22

4.8 3.1 2.4 1.1

2.7 2.7 2.8 3.1

1.3 0.7 0.5 0.3

1.8 1.8 2 2.1

10.8 8 5.9 3.3

11.5 11.5 12.4 13.7

11881 12104 12216 12168

38.9 38.2 37.5 37

1554 1415 1135 957

13.1 11.7 9.3 7.9

957 841 685 565

5.07 5.1 4.58 3.87

— — 0.38 0.53

— — 5.4 13.6

189 165 150 144

18.31 16.37 17.88 19

1186 1012 1042 937

-331 -328 -374 -366

855 684 668 571

4.92 4.89 5.92 —

2141 1959 1778 —

36.33 36.61 35.71 36.29

8.06 6.95 5.61 4.64

1.81 1.83 1.83 1.81

14.6 12.69 10.27 8.4

2.46 2.54 2.52 2.49

28.65 31.74 25.96 21.33

19.77 20.27 16.57 13.64

— — — —

2.1 2.04 1.87 1.77

0.51 0.32 0.24 0.23

2.46 2.54 2.52 2.49

0.55 0.58 0.55 0.55

CROIC 10yROTC
avg (TTM)
ROTC 10y ROE
avg (TTM) ROE 10y avg Operating margin (TTM)
18% 14% 20% 21% 24% 8%
Operating margin 10y avgNet margin (TTM) Net margin 10y avg Return on retained earnings
12% 5% 8% 4.4 %
Years of EPS Growth Y's of positive EPS Y's of revenue growth Y's of FCF Growth
7 11 9 4
Y's of positive FCF Y's of dividend growth Y's of dividend paid Y's of oper. inc. growth
11 11 11 4
Y's of pos.operating inc. Y's of O.C.F growth Y's of positive O.C.F FCF covariation
11 4 11 20%
Dividend safety (TTM) Dividend safety 10y avg
12.3 15.3
Net inc of cash flow from operation (TTM)
Net inc of cash flow from operation 10y avg
60% 77%
Dividend payout ratio (TTM) Dividend payout ratio 10y avg
14% 11%
Capex of operating cash flow
Capex
(TTM)
of operating cash flow10y
10y avg 5y 3y 1y P/E (TTM)
39% 31% 7.1 % 9.6 % 9.5 % 4.2 % 5.5
P/E 10y avg P/B (TTM) P/B 10y avg P/S (TTM) P/S 10y avg
13.6 1.1 3.1 0.3 1.1
P/operating cash flow (TTM)
P/operating cash flow 10y
P/FCF
avg (TTM) Shiller P/E
3.3 10.6 5.4 5.7
P/Operating income (TTM) FCF/market cap yield (TTM)Dividend yield (TTM)
Shareholder yield (TTM)
3.2 18.7 % 2.5 % 6.7 %
Peter Lynch ratio (TTM)
Warren Buffets ratio (TTM)
EV/Operating income (TTM) FCF/Enterprise yield (TTM)
3.21 6.39 4.3 14.0 %
Total quality score Company quality Current stock price Intrinsic value Buyprice
58% Very good 21.23 49 29
Margin of safetyBuy/Hold/Sell
57% Buy
Copyright 2017. The Warren Buffett Spreadsheet
How to use Youtube instruction video

Date of analysis 10/13/2017

Datainput from Gurufocus.com
Stock ticker NKE
Stock price 50.8
Enterprise value (Mill) 81180
F-Score 5
Z-score 7.20
M-Score -2.33
Required Margin of safety % 30%
Desired Discount Rate % 11%
20 AA Corporate bond Rate % 2.95%
Dicount Rate 10y fed note % 2.26%

Score chart

Checklist
Scores (maxratios
100%)
Valuation ratios 13%
Earnings stability 75%
Efficiency
Efficiency growth 25%
Growth rates
Financial strenght 100%
Growth
Financialrates
strenght 86%
Earnings stability 67%
Checklist
Efficiencyratios
growth 56%

Efficiency

Valuation ratios

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Valuation inputs
P/E 10y median Change?
22.8
3 year average free cash flow
2735
5 year average free cash flow Change?
2544
10y average free cash flow
2100

Growth rates. Median

Free cash flow Change?
8.6 %
EPS Change?
14.4 %
Book value growth rate
10.0 % 10%
Future Expected ROE Change?
20.0 % 20%

A c t u al mar g in o f safet y v s req u ir ed mar g in o f safet y

30% Required Margin of safety %

Margin of safety
-31%

-40% -20% 0% 20% 40% 60% 80% 100%

Past 10 years valuation 1 2

P/E 19.0 13.6

P/B 4.3 3.0
P/S 1.9 1.3
P/Operating cash flow 14.3 15.6

Past 10 years data 1 2

Revenue / sales (mill) 18627 19176
Operating Income (mill) 2433 1859
Net Income (mill) 1883 1487
Earnings Per Share  0.94 0.76
Dividend per share 0.22 0.24
Shares outstanding (mill) 2016 1962
Book Value Per Share 3.9 4.2
Operating Cash Flow (mill) 1936 1736
Free Cash Flow (mill) 1487 1280
Interest Coverage — —
Current Ratio 2.66 2.97
Debt/Equity 0.06 0.05

Long term debt 469 414

Total equity 7822 8280
Sales/revenue per share 9.2 9.8
Operating income per share 1.2 0.9
Operating cash flow per share 1.0 0.9
Free cash flow per share 0.7 0.7
Capex 449 455
FCF margin 0.61 0.69

STDV 0.21
Average FCF margin 0.64
FCF coefficient variation 33%
10y avg EPS 1.5
10y avg FCF per share 1.2

10y avg free cash flow 2121

5y avg free cash flow 2531
3y avg free cash flow 2272

10y avg capex 449

5y avg capex 1038
3yavg capex 1115

Financial strength 1 2
Y's to pay long term debt with net income 0.2 0.3
Y's pay long term debt with free cash flow 0.3 0.3
Debt/Equity 0.1 0.1
Current ratio 2.7 3.0
Interest coverage — —

Efficiency 1 2
FCF/Sales 8% 7%
CROIC 18% 15%
ROTC 23% 17%
ROE 25% 18%
Gross margin 45% 45%
Operating margin 13% 10%
Net margin 10% 8%
Return on retained earnings

Checklist ratios past 10 years 1 2

Dividend safety 4.4 3.7
Net income of cash flow from operation 97% 86%
Dividend payout ratio 23% 32%
Capex of operating cash flow 23% 26%
5 year cumulative capex of 5y cumulative net inc 29%

Earnings and growth stability past 10 years 1 2

EPS (Earnings per share) 0.94 0.76
Number of years of new high EPS
Number of years with positive EPS 1 1
Sales/revenue 18627 19176
Number of years new high revenue/sales 1
Free cash flow 1487 1280
Number of years of new high free cash flow
Number of years with positive FCF 1 1
Dividend 0.2 0.2
Number of years of new high dividend 1
Number of years with dividend payment 1 1
Operating income 2433 1859
Number of years new high operating income
Number of years with positive operating income 1 1
Operating cash flow 1936 1736
Number of years of new operating cash flow
Number of years with positive operating cash flow 1 1

Growth rates %. Different time periods 1y-8y 2y-9y

Free cash flow (FCF) 14.0 % 6.2 %
Sales/Revenue 7.3 % 7.8 %
EPS (Earnings per share) 10.2 % 16.1 %
Net income 8.2 % 14.2 %
Book Value per share 9.3 % 8.2 %
Operating income 8.0 % 13.5 %
Operating cash flow 13.4 % 8.6 %

Growth rates %. Different time periods 1y-8y 2y-9y

FCF/Sales 6.2 % -1.4 %
CROIC 6.0 % -1.5 %
ROTC 1.3 % 7.0 %
ROE 1.3 % 7.6 %
Gross margin 0.3 % 0.4 %
Operating margin 0.6 % 5.3 %
Net Margin 0.8 % 5.9 %

Historical valua
35

30

25

20

15

10

0
1 2 3 4 5 6 7
 10

0
1 2 3 4 5 6 7

Earnings grow
25

20

15

10

0
1 2 3 4 5 6 7

Earnings grow
Revenue / sales (mill) Operating Income (mill)
40000 5000
34350 34359 4500 4175
35000 32376
30601 4000 3680
30000 27799
23331
25313 3500 3069 3238
25000 3000 2841
20117 2433 2474
20000 18627 19176 19014 2500
2000 1859
15000
1500
10000
1000
5000 500
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Earnings Per Share  Dividend per share

3.00 0.80
2.5 0.70
2.50 2.4
2.2 0.60 0.54
2.00 1.9 0.47
0.50
1.5 0.41
1.50 1.4 0.40 0.35
1.1 1.2 0.30
0.9 1.0 0.30 0.27
1.00 0.22 0.24
0.8
0.20
0.50
0.10
0.00 0.00
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
 2.2 0.60 0.54
2.00 1.9 0.47
0.50
1.5 0.41
1.50 1.4 0.40 0.35
1.1 1.2 0.30
0.9 1.0 0.30 0.27
1.00 0.22 0.24
0.8
0.20
0.50
0.10
0.00 0.00
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Operating Cash Flow (mill) Free Cash Flow (mill)

5000 4680 4000 3717
4500 3500
4000 3640
3427 3000 2829
3500 3164 3096
3027 3003 2391
3000 2500
2123
2500 2000
1936 1812 1899 1487
2000 1736 1500 1280 1380 1302
1500
1000
1000
500 500
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Sales/revenue per share Operating income per share

25 3
20.3 20.4 2.4
20 2.5
18.6
17.3 2.0
15.4 2 1.8
15 13.8 1.6
12.4 1.5
10.4 1.5 1.3
9.2 9.8 9.6 1.2
10 0.9
1
5 0.5

0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Efficiency
50%

45%

40%

35%

30%

25%

20%

15%

10%
25%

20%

15%

10%

5%

0%
1 2 3 4 5 6 7

FCF/Sales CROIC
16% 15% 30% 28% 27%
14%
12% 25%
12%
20%
9% 20% 18%
10% 17%
8% 8% 15%
8% 7% 7% 15% 13%
7% 7% 12%
6% 6%
6%
10%
4%
5%
2%
0% 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

ROE Operating margin

40% 16%
34% 14% 14%
35% 33% 14% 13% 13% 13% 13% 13%
30%
30% 28% 12%
25% 25% 10%
25% 23% 10%
21% 22% 22%
20% 18% 8%
15% 6%
10% 4%
5% 2%
0% 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Financial stren
Y's to pay long term debt with net inc. Y's pay long term debt with F
1 0.9 1.8
0.9 0.9 1.6
0.8 1.4
0.7 1.2
0.6 0.5
0.5 0.5 1
0.5
0.8
0.4 0.3 0.6
0.2 0.3 0.3 0.6 0.5
0.3
0.4 0.3 0.3 0.3
0.2 0.1 0.2
0.1 0.2 0.2
0.1 0.2
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number
 0.5
0.8
0.4 0.3 0.6
0.2 0.3 0.3 0.6 0.5
0.3
0.4 0.3 0.3 0.3
0.2 0.1 0.2
0.1 0.2 0.2
0.1 0.2
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Current ratio Interest coverage

4 800
3.47 712
3.5 3.26 700
3 2.66
2.97 2.85 2.98 2.72 2.8 2.93
600
2.67
2.52
2.5 500
2 400
1.5 300
1 200
0.5 100
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Checklist ratios &

Dividend safety Net inc of cash flow from opera
7 5.9334270979840 140%
6 118% 116%
6 4.9019607843137 120%
4.3650793650793 3 97%
7 5 3.6867142371729 100%
86% 90%
4.0299818937054
3.5280848714122 82%
4 5 3.1101956745623 9 3.0732860520094 80% 70%
1 2.8649158847371
2.8264383742412
2.8875541701513 1 6 60%
3 2 60%

2 40%

1 20%

0 0%
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Capex of operating cash flow Shares outstanding (mill)

40% 37% 2100
2016
35% 32%
31% 30% 2000 1962 1975 1942
29%
30%
26% 1879
24% 1900
25% 23% 1832 1811
21% 21%
20% 1800 1768
15%
11% 1700
10%
1600
5%
0% 1500
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number
 Intrinsic Valuation methods
2 Stage DCF valuation

5y average free cash flow: 2,544

Years: 1-3 4-7

Growth Rate: 9% 7%

Terminal Growth Rate: 2% Discount Rate:

Shares Outstanding: 1,684 MOS:

Year Flows Growth

1 2,762 9%
2 2,999 9%
3 3,256 9%
4 3,480 7%
5 3,719 7%
6 3,974 7%
7 4,246 7%
8 4,538 7%
9 4,787 5%
10 5,050 5%

Terminal Year 5151

PV of Year 1-10 Cash Flows: 21591
Terminal Value: 32533
Total PV of Cash Flows: 54125
Number of Shares: 1,684
Intrinsic Value (IV): 32

Katsenelsons Absolute P/E Valuation

No Growth P/E 7
EPS Growth Rate % 14.4 % Points
Dividend Yield % 1.42% Points
Basic P/E 18.0
Business Risk 0.90 Adjustment
Financial Risk 0.90 Adjustment
Earnings stability 1 Adjustment
5y average EPS 2.07
Current Stock Price 50.80
Fair Value P/E 21.8
Intrinsic Value 45

Benjamin Grahams Growth Formula

Normalized EPS Using The ROE Method:
10y median ROE 20.0 %
Shareholders Equity (TTM) 12377
Normalized Net Income 2475
Shares Outstanding 1684
Normalized EPS 1.47
Normalized EPS Using The Net Margin Method:
10 Year Average Net Profit Margin 10.3 %
Revenue (TTM) 34359
Normalized Net Income 3547
Normalized EPS 2.11
Average Normalized EPS 1.79
20y AA Corp Bond Rate 2.95
Estimated Future EPS Growth Rate 14.43
Current Stock Price 50.80
Intrinsic Value 62

Classic Value investors valuation Year

Current Stock Price 50.80 1
5 year average EPS 2.07 2
Dividend pay out ratio 29% 3
EPS growth rate (1st five years) 14.4 % 4
EPS Growth Rate (2nd Five Years) 11.5 % 5
Discount Rate 11% 6
P/E Ratio in 10 Years ( 10y median p/e ratio) 22.8 7
8
9
10

Value of Future Dividends Today 6.83 Year

Value of Future Sales Price Today 56.37 10
Intrinsic Value Of The Stock 63

P/E valuation
5y average EPS 2.07
Average historical P/E 22.8
EPS growth rate 14%
Growth decline rate 2%
Discount rate 11%

Year EPS*Growth rate

1 2.37
2 2.71
3 3.08
4 3.50
5 3.97
6 4.48
7 5.06
8 5.69
9 6.39
10 7.16
Value in 10 years 163
Intrinsic Value 97

Book value growth + Dividend valuation

Current Stock Price 50.80
Annual Dividend 0.72
Years Of Future Value Calculation 10
Discount Rate - 10 yr. Fed Note 2.26%
Future Book Value 23
Book Value Growth Rate 10.0 %
Book value growth adjusted for share buybacks 12.0 %
Current Year Book Value 7.35
Intrinsic Value 25

Projected Annual Compounding Return

10y Median Return On Equity 20.0 %
Percentage Of Earnings Retained 71%
Estimated Book Value Growth 10.0 %
Number Of Years 10
Present Book Value 7.35
Future Book Value -19
Converting Percentage To Decimal 0.200
Future Per Share Earnings 3.8
Terminal value 87
Intrinsic Value 31

ROE valuation
Shareholders equity (TTM) 12377
Current stock Price 50.8
10y median Return on Equity (avg) 20.0 %
Shares outstanding 1684
Dividend Yield 1.42%
Dividend payout ratio 29%
Desired Margin of Safety 30%
Conservative growth rate 9.9 %
Discount rate 11%

Calculations (per share)

Year Total Equity Dividend
1 8.08 0.79
2 8.89 0.87
3 9.77 0.96
4 10.74 1.05
5 11.81 1.16
6 12.98 1.27
7 14.28 1.40
8 15.70 1.54
9 17.26 1.69
10 18.97 1.86
Year 10 EPS 3.79
Required value 34.50
NPV required value 12.15
NPV dividends 7.92
Intrinsic value: 20

Keynumbers used in watchlist Ticker Date

NKE 10/13/2017
Market cap (mill) 85547 Valuation methods
3 stage DCF

Intrinsic value 39 Katsenelsons absolute p/e

Buyprice 27 B.Graham Formula

Margin of safety -31% Classic Value Valuation

Total quality score 71% P/E Valuation

Company Quality Very good Book Value I.V

Buy/hold/sell? Consider sell Projected compounding

ROE Valuation
Median
Share buybacks Data
10y 2.0 % Valuation ratios
5y 1.7 % P/E
3y 1.6 % P/E Yield
1y 0.5 % P/B
P/S
P/operating cash flow
Growth rates Median Shiller P/E
FCF (Free cash flow) 9% P/Operating income
Sales/revenue 8% Operating income/p yield
EPS (Earnings per share) 14% EV/Operating income
Book value growth 8% Operating income/EV yield
Operating income 10% EV/FCF
Operating cash flow 10% FCF/Enterprise yield
Dividend 10y growth 14% P/FCF
FCF/price yield
Dividend yield
Earnings stability 10y Data Shareholders Yield
Years of EPS Growth 8 Peter Lynch PEG ratio
Y's of positive EPS 11 Warren Buffets's ratio
Y's of revenue growth 9
Y's of FCF Growth 2 Efficiency
Y's of positive FCF 11 FCF/Sales
Y's of dividend growth 11 CROIC
Y's of dividend paid 11 ROTC
Y's of oper. inc. growth 8 ROE
Y's of pos.operating inc. 11 Gross margin
Y's of O.C.F growth 2 Operating margin
Y's of positive O.C.F 11 Net margin
FCF covariation 33% Return on retained earnings

Financial strength
Efficiency growth Median Y's to pay debt with net.Inc
FCF/Sales 0.6 % Y's to pay debt with FCF
CROIC 1.0 % Debt/Equity
ROTC 5.4 % Current ratio
ROE 6.5 % Interest coverage
Gross Margin 0.1 % F-Score
Operating margin 0.9 % Z-Score
Net margin 2.4 % M-Score

Checklist ratios
Dividend safety
Net Inc of cash from operation
Dividend payout ratio
Capex of operating cash flow
Cum. capex of Cum. net inc

3 4 5 6

22.0 20.6 20.6 21.9

3.5 4.1 4.5 4.6
1.8 2.1 2.0 1.9
13.1 17.2 26.1 18.8

3 4 5 6
19014 20117 23331 25313
2474 2841 3069 3238
1907 2133 2211 2472
0.96 1.10 1.18 1.35
0.27 0.30 0.35 0.41
1975 1942 1879 1832
4.9 5.3 5.7 6.0
3164 1812 1899 3027
2829 1380 1302 2391
— 712 — —
3.26 2.85 2.98 3.47
0.05 0.03 0.02 0.11

481 306 213 1203

9618 10215 10654 10937
9.6 10.4 12.4 13.8
1.3 1.5 1.6 1.8
1.6 0.9 1.0 1.7
1.4 0.7 0.7 1.3
335 432 597 636
1.14 0.49 0.42 0.74

3 4 5 6
0.3 0.1 0.1 0.5
0.2 0.2 0.2 0.5
0.1 0.0 0.0 0.1
3.3 2.9 3.0 3.5
— 712.0 — —

3 4 5 6
15% 7% 6% 9%
28% 13% 12% 20%
19% 20% 21% 21%
21% 22% 22% 23%
46% 46% 44% 44%
13% 14% 13% 13%
10% 11% 9% 10%

3 4 5 6
5.9 3.1 2.9 4.0
60% 118% 116% 82%
28% 27% 30% 30%
11% 24% 31% 21%

3 4 5 6
0.96 1.10 1.18 1.35
1 2 3 4
1 1 1 1
19014 20117 23331 25313
 2 3 4
2829 1380 1302 2391
1
1 1 1 1
0.3 0.3 0.4 0.4
2 3 4 5
1 1 1 1
2474 2841 3069 3238
1 2 3 4
1 1 1 1
3164 1812 1899 3027
1
1 1 1 1

3y-10y 1y-6y 2y-7y 3y-8y

-1.6 % 10.0 % 10.6 % 5.6 %
8.8 % 6.3 % 7.7 % 10.0 %
14.7 % 7.5 % 14.4 % 14.0 %
12.1 % 5.6 % 12.6 % 11.4 %
6.8 % 9.0 % 8.7 % 8.2 %
9.8 % 5.9 % 14.6 % 11.0 %
2.0 % 9.4 % 11.6 % 8.1 %

3y-10y 1y-6y 2y-7y 3y-8y

-9.5 % 3.4 % 2.7 % -4.0 %
-8.4 % 1.9 % 2.3 % -0.8 %
5.4 % -1.3 % 5.6 % 5.4 %
7.5 % -1.9 % 6.4 % 6.1 %
-0.5 % -0.6 % 0.0 % -0.1 %
0.9 % -0.4 % 6.4 % 1.0 %
3.0 % -0.7 % 4.6 % 1.3 %

Historical valuation

P/E
P/B
P/S
P/Operating cash flow

6 7 8 9 10 11
 P/Operating cash flow

6 7 8 9 10 11

Earnings growth

Sales/revenue per share

Operating cash flow per share
Operating income per share
Earnings Per Share 
Free cash flow per share
Book Value Per Share
Dividend per share

6 7 8 9 10 11

Earnings growth
Operating Income (mill) Net Income (mill)
4749 4629 4500 4240
4502 3941
4175 4000 3760
3680 3500 3273
3069 3238 3000 2693
2841 2472
2474 2500 2133 2211
1907
1859 2000 1883
1487
1500
1000
500
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Dividend per share Book Value Per Share

9
0.70 0.72
8 7.7
7.2 7.3 7.4
0.62
7 6.4
0.54 6.0
6 5.7
0.47 5.3
0.41 4.9
5 4.2
0.35 3.9
0.30 4
0.27
0.24 3
2
1
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
 7 6.4
0.54 6.0
6 5.7
0.47 5.3
0.41 4.9
5 4.2
0.35 3.9
0.30 4
0.27
0.24 3
2
1
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Free Cash Flow (mill) Free cash flow per share

3717 2.5
2.1
2
2829
2535
2391 2329 1.4 1.5
2123 1.5 1.3 1.4
1953 1.2 1.1
1280 1380 1302 1
0.7 0.7 0.7 0.7
0.5

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Operating income per share Operating cash flow per share

2.8 2.7 3
2.6 2.6
2.4 2.5
2.2
2.0 2.0
1.8 2 1.8
1.6 1.6 1.7 1.7
1.5
1.3 1.5
0.9 1.0 0.9 1.0
1 0.9

0.5

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Efficiency

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin
 CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

5 6 7 8 9 10 11

CROIC ROTC
28% 30% 28%
27% 27% 26%
25%
25% 23%
21% 21% 22%
20% 20%
20% 19%
17% 17%
15% 15% 15%
13% 13% 15%
12%
10%

5%

0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Operating margin Net margin

14%
14% 14% 14% 14% 12%
13% 13% 13% 13% 12% 11%
13% 12%
11% 11%
10% 10% 10% 10%
10% 9%
10%
8%
8%

6%

4%

2%

0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Financial strength
Y's pay long term debt with FCF Debt/Equity
0.35
1.5 0.29
1.4 0.3 0.28

0.25
1.0
0.2
0.16
0.15
0.6 0.11 0.11
0.5
0.1 0.08
0.3 0.3 0.06
0.2 0.05 0.05
0.2 0.2 0.05 0.03 0.02
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number
 0.16
0.15
0.6 0.11 0.11
0.5
0.1 0.08
0.3 0.3 0.06
0.2 0.05 0.05
0.2 0.2 0.05 0.03 0.02
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Interest coverage Long term debt

4000 3667
712 3589
3500
3000
2500
2039
2000
1500 1203 1275
1021
1000
469 414 481
500 306 213
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Checklist ratios & Misc

Net inc of cash flow from operation Dividend payout ratio
35%
121% 32% 30% 32% 31%
118% 116% 116% 115% 30% 29% 29%
30% 28% 27% 28%

90% 25% 23%

86% 82%
70% 20%
60%
15%

10%

5%

0%
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Shares outstanding (mill) FCF vs EPS

4500
4000 Net Income (mill)
1962 1975 1942
3500
1879 3000 Free Cash Flow (mill)
1832 1811
2500
1768
1743 2000
1692 1684 1500
1000
500
0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number
ods

8-10
5%

11%

30%

Value
2,488
2,434
2,381
2,292
2,207
2,125
2,045
1,969
1,871
1,778

P/E Exp EPS Grwth Rate Dividend Yield Add'l P/E Points
7.00 0% 0.0% 0.0
7.65 1% 0.1% 0.5
8.30 2% 0.5% 0.5
9.4 8.95 3% 1.0% 1.0
1.5 9.60 4% 1.5% 1.5
10.25 5% 2.0% 2.0
10.90 6% 2.5% 2.5
1.10 11.55 7% 3.0% 3.0
12.20 8% ∆0.65 3.5% 3.5
1.10 12.85 9% 4.0% 4.0
1.00 13.50 10 % 4.5% 4.5
14.15 11 % 5.0% 5.0
14.80 12 % 5.5% 5.5
15.45 13 % 6.0% 6.0
16.10 14 % 6.5% 6.5
16.75 15 % 10.0% 10.0
17.40 16 %
17.90 17 %
18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
21.90 25 %
 18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
21.90 25 %

Projected EPS Pay out ratio Dividends Disc. Divid.

2.4 29% 0.7 0.62
2.7 29% 0.8 0.64
3.1 29% 0.9 0.66
3.6 29% 1.0 0.68
4.1 29% 1.2 0.70
4.5 29% 1.3 0.70
5.1 29% 1.5 0.71
5.6 29% 1.6 0.71
6.3 29% 1.8 0.71
7.0 29% 2.0 0.72
Sum 6.83
Projected EPS PE ratio in 10 years Terminal value Disc. term. V.
7.0 22.8 160.06 56.37
NPV dividends
0.79
0.79
0.79
0.79
0.79
0.79
0.79
0.79
0.79
0.79

F-Score Z-score M-score Interest coverage (TTM)

5 7.20 -2.33 —
Intrinsic value Buyprice Margin of safety
32 22 -58%
45 32 -12%
62 43 18%
63 44 20%
97 68 48%
25 17 -106%
31 21 -66%
20 14 -153%
39 27 -35%

TTM 10y avg 5y avg

21.6 22.8 26.6
4.6 % 3.0 % 3.7 %
6.9 5.4 7.2
2.5 2.3 2.9
25.0 21.2 25.7
33.6
18.5
5.4 %
17.5
5.7 %
34.9
2.9 %
36.7
2.7 %
1.4 %
1.9 %
0.73
1.86

TTM 10y avg 5y avg

7% 8% 9%
15% 17% 18%
26% 23% 24%
33% 25% 28%
44% 45% 45%
13% 13% 13%
11% 10% 11%
11.9 %

TTM 10y avg 5y avg

0.9 0.4 0.5
 1.5 0.6 0.8
0.3 0.1 0.1
2.7 2.9 2.9
— 712.0 0
5
7
-2.33

TTM 10y avg 5y avg

2.8 3.7 3.7
115% 97% 96%
31% 29% 30%
32% 26% 28%
27% 29%

7 8 9 10 TTM
Visually

27.0 30.0 31.6 22.9 21.6

6.2 7.5 8.3 6.9 6.9
2.8 3.0 3.6 2.7 2.5
23.3 29.1 24.6 26.5 25.0

7 8 9 10 TTM Visually
27799 30601 32376 34350 34359
3680 4175 4502 4749 4629
2693 3273 3760 4240 3941
1.49 1.85 2.16 2.51 2.35
0.47 0.54 0.62 0.70 0.72
1811 1768 1743 1692 1684
6.4 7.2 7.3 7.7 7.4
3003 4680 3096 3640 3427
2123 3717 1953 2535 2329
— — — — —
2.72 2.52 2.80 2.93 2.67
0.11 0.08 0.16 0.28 0.29

1275 1021 2039 3667 3589

11590 12765 12741 13096 12377
15.4 17.3 18.6 20.3 20.4
2.0 2.4 2.6 2.8 2.7
1.7 2.6 1.8 2.2 2.0
1.2 2.1 1.1 1.5 1.4
880 963 1143 1105 1098
0.58 0.89 0.43 0.53 0.50

7 8 9 10 TTM 10y Average

0.5 0.3 0.5 0.9 0.9 0.4
0.6 0.3 1.0 1.4 1.5 0.6
0.1 0.1 0.2 0.3 0.3 0.1
2.7 2.5 2.8 2.9 2.7 2.9
— — — — — 712.0

7 8 9 10 TTM 10y Average

8% 12% 6% 7% 7% 8%
17% 27% 13% 15% 15% 17%
22% 25% 27% 28% 26% 23%
25% 28% 30% 34% 33% 25%
45% 46% 46% 45% 44% 45%
13% 14% 14% 14% 13% 13%
10% 11% 12% 12% 11% 10%
12%

7 8 9 10 TTM 10y Average

3.5 4.9 2.9 3.1 2.8 3.7
90% 70% 121% 116% 115% 97%
32% 29% 29% 28% 31% 29%
29% 21% 37% 30% 32% 26%

7 8 9 10 TTM
1.49 1.85 2.16 2.51 2.35
5 6 7 8
1 1 1 1 1
27799 30601 32376 34350 34359
 5 6 7 8 9
2123 3717 1953 2535 2329
2
1 1 1 1 1
0.5 0.5 0.6 0.7 0.7
6 7 8 9 10
1 1 1 1 1
3680 4175 4502 4749 4629
5 6 7 8
1 1 1 1 1
3003 4680 3096 3640 3427
2
1 1 1 1 1

4y-9y 5y-10y Median

7.2 % 14.3 % 8.6 %
10.0 % 8.0 % 7.9 %
14.4 % 16.3 % 14.4 %
12.0 % 13.9 % 12.0 %
6.8 % 6.4 % 8.2 %
9.6 % 9.1 % 9.7 %
11.3 % 13.9 % 10.3 %

4y-9y 5y-10y Median

-2.5 % 5.7 % 0.6 %
0.1 % 4.8 % 1.0 %
5.4 % 5.9 % 5.4 %
6.7 % 9.4 % 6.5 %
0.2 % 0.5 % 0.1 %
-0.3 % 1.0 % 0.9 %
1.8 % 5.4 % 2.4 %

P/E
P/B
P/S
P/Operating cash flow
 P/Operating cash flow

/revenue per share

ating cash flow per share
ating income per share
ngs Per Share 
cash flow per share
Value Per Share
end per share

4240
3941
3760
3273

8 9 10 11

re
7.7
7.2 7.3 7.4

8 9 10 11
 8 9 10 11

are
2.1

1.5
1.4
1.1

8 9 10 11

share
2.6

2.2
2.0
1.8

8 9 10 11

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin
 CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

28%
27% 26%
25%

8 9 10 11

12%
12% 11%
11%

8 9 10 11

0.28 0.29

0.16

0.08

8 9 10 11
 0.16

0.08

8 9 10 11

3667 3589

2039

1021

8 9 10 11

tio
31%
29% 29% 28%

8 9 10 11

8 9 10 11
Interest coverageDebt/Equity
10y avg (TTM)
Debt/Equity 10y avg
Current ratio
Current
(TTM)ratio
Y's to10y
payavg
debt with net inc (TTM)
712.0 0.3 0.1 2.7 2.9 0.9
Y's to pay debt with net inc 10y avg Years to pay debt with FCF
Years
(TTM)
to pay debt with
FCF
FCF
(Free
10ycash
avg flow)
0.4 1.5 0.6 9%
 Datainput from Morningstar.com

Morningstar valuation ratios

NKE 19 13.6 22 20.6 20.6 21.9 27
S&P 500 16.5 10.9 18.6 15.5 13.7 15 18.6
Price/Book
NKE 4.3 3 3.5 4.1 4.5 4.6 6.2
S&P 500 2.7 1.7 2.2 2.2 2 2.1 2.6
Price/Sales
NKE 1.9 1.3 1.8 2.1 2 1.9 2.8
S&P 500 1.5 0.9 1.2 1.3 1.2 1.3 1.7
Price/Cash Flow
NKE 14.3 15.6 13.1 17.2 26.1 18.8 23.3
S&P 500 11.6 6.8 9.1 9.3 8.5 9.2 11.2

Morningstar key ratios

Revenue USD Mil 18627 19176.00 19014 20117 23331 25313 27799

Gross Margin % 45 44.90 46.3 45.7 43.5 43.6 44.8

Operating Income USD Mil 2433 1859.00 2474 2841 3069 3238 3680

Operating Margin % 13.1 9.7 13 14.1 13.2 12.8 13.2

Net Income USD Mil 1883 1487 1907 2133 2211 2472 2693

Earnings Per Share USD 0.94 0.76 0.96 1.1 1.18 1.35 1.49

Dividends USD 0.22 0.24 0.27 0.3 0.35 0.41 0.47

Payout Ratio % * 28 29 29.6 27.3 29.4 31.5 30.4

Shares Mil 2016 1962 1975 1942 1879 1832 1811

Book Value Per Share * USD 3.88 4.22 4.87 5.26 5.67 5.97 6.4

Operating Cash Flow USD Mil 1936 1736 3164 1812 1899 3027 3003

Cap Spending USD Mil -449 -455 -335 -432 -597 -636 -880

Free Cash Flow USD Mil 1487 1280 2829 1380 1302 2391 2123
Free Cash Flow Per Share * USD 0.93 0.41 1.32 0.71 0.69 1.1 1.17

Working Capital USD Mil 5518 6457 7595 7339 7666 9700 8669

Morningstar profitability tab

Tax Rate % 24.75 24.01 24.24 25 25.48 24.69 24.01

Net Margin % 10.11 7.75 10.03 10.22 9.21 9.82 9.69

Asset Turnover (Average) 1.61 1.49 1.37 1.42 1.58 1.53 1.54

Return on Assets % 16.28 11.57 13.78 14.5 14.59 15.04 14.89

Financial Leverage (Average) 1.59 1.52 1.48 1.52 1.49 1.58 1.72

Return on Equity % 25.36 18 20.67 21.77 21.98 23.08 24.5

Return on Invested Capital % 22.79 16.56 19.21 20.49 20.9 21.32 21.77

Interest Coverage — — — 712 — — —

Morningstar financial health tab

Current Ratio 2.66 2.97 3.26 2.85 2.98 3.47 2.72

Quick Ratio 1.68 1.93 2.32 1.94 1.82 2.31 1.7

Financial Leverage 1.59 1.52 1.48 1.52 1.49 1.58 1.72

Debt/Equity 0.06 0.05 0.05 0.03 0.02 0.11 0.11

Sales/revenue EPS (Earnings per share)Book valueOperating
growth Operating
incomeDividend
cash flow
10y
FCF/Sales
growth
FCF/sales
(TTM) 10y
CROIC
avg (TTM)
8% 14% 8% 10% 10% 14% 7% 8% 15%
.com

30 31.6 22.9 21.6

18.6 19 20.3 22

7.5 8.3 6.9 6.9

2.7 2.7 2.8 3.1

3 3.6 2.7 2.5

1.8 1.8 2 2.1

29.1 24.6 26.5 25

11.5 11.5 12.4 13.7

30601 32376 34350 34359

46 46.2 44.6 44.1

4175 4502 4749 4629

13.6 13.9 13.8 13.5

3273 3760 4240 3941

1.85 2.16 2.51 2.35

0.54 0.62 0.7 0.72

29.7 27.8 28.3 30.6

1768 1743 1692 1684

7.22 7.31 7.74 7.35

4680 3096 3640 3427

-963 -1143 -1105 -1098

3717 1953 2535 2329

2.1 1.21 1.71 —

9642 9667 10587 —

22.16 18.67 13.22 15.74

10.7 11.61 12.34 11.47

1.52 1.51 1.54 1.53

16.29 17.49 18.99 17.59

1.7 1.75 1.87 1.97

27.82 30.12 34.38 32.63

25.02 26.59 27.78 26.25

— — — —

2.52 2.8 2.93 2.67

1.47 1.62 1.8 1.55

1.7 1.75 1.87 1.97

0.08 0.16 0.28 0.29

CROIC 10yROTC
avg (TTM)
ROTC 10y ROE
avg (TTM) ROE 10y avg Operating margin (TTM)
17% 26% 23% 33% 25% 13%
Operating margin 10y avgNet margin (TTM) Net margin 10y avg Return on retained earnings
13% 11% 10% 11.9 %
Years of EPS Growth Y's of positive EPS Y's of revenue growth Y's of FCF Growth
8 11 9 2
Y's of positive FCF Y's of dividend growth Y's of dividend paid Y's of oper. inc. growth
11 11 11 8
Y's of pos.operating inc. Y's of O.C.F growth Y's of positive O.C.F FCF covariation
11 2 11 33%
Dividend safety (TTM) Dividend safety 10y avg
2.8 3.7
Net inc of cash flow from operation (TTM)
Net inc of cash flow from operation 10y avg
115% 97%
Dividend payout ratio (TTM) Dividend payout ratio 10y avg
31% 29%
Capex of operating cash flow
Capex
(TTM)
of operating cash flow10y
10y avg 5y 3y 1y P/E (TTM)
32% 26% 2.0 % 1.7 % 1.6 % 0.5 % 21.6
P/E 10y avg P/B (TTM) P/B 10y avg P/S (TTM) P/S 10y avg
22.8 6.9 5.4 2.5 2.3
P/operating cash flow (TTM)
P/operating cash flow 10y
P/FCF
avg (TTM) Shiller P/E
25.0 21.2 36.7 33.6
P/Operating income (TTM) FCF/market cap yield (TTM)Dividend yield (TTM)
Shareholder yield (TTM)
18.5 2.7 % 1.4 % 1.9 %
Peter Lynch ratio (TTM)
Warren Buffets ratio (TTM)
EV/Operating income (TTM) FCF/Enterprise yield (TTM)
0.73 1.86 17.5 2.9 %
Total quality score Company quality Current stock price Intrinsic value Buyprice
71% Very good 50.8 39 27
Margin of safetyBuy/Hold/Sell
-31% Consider sell
Copyright 2017. The Warren Buffett Spreadsheet
How to use Youtube instruction video

Date of analysis 10/13/2017

Stock ticker TGT

Stock price 61
Enterprise value (Mill) 43290
F-Score 6
Z-score 3.20
M-Score -2.97
Required Margin of safety % 40%
Desired Discount Rate % 11%
20 AA Corporate bond Rate % 2.95%
Dicount Rate 10y fed note % 2.26%

Score chart

Checklist
Scores (maxratios
100%)
Valuation ratios 60%
Earnings stability 38%
Efficiency
Efficiency growth 0%
Growth rates
Financial strenght 85%
Growth
Financialrates
strenght 14%
Earnings stability 33%
Checklist
Efficiencyratios
growth 78%

Efficiency

Valuation ratios

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Valuation inputs
P/E 10y median Change?
15.8
3 year average free cash flow
3649
5 year average free cash flow Change?
3213
10y average free cash flow
2506

Growth rates. Median

Free cash flow Change?
3.0 %
EPS Change?
3.5 %
Book value growth rate
3.7 %
Future Expected ROE Change?
18.5 %

A c t u al mar g in o f safet y v s req u ir ed mar g in o f safet y

40% Required Margin of safety %

Margin of safety
-29%

-40% -20% 0% 20% 40% 60% 80% 100%

Past 10 years valuation 1 2

P/E 14.7 10.5

P/B 2.6 1.9
P/S 0.7 0.4
P/Operating cash flow 9.1 6.3

Past 10 years data 1 2

Revenue / sales (mill) 63367 64948
Operating Income (mill) 5272 4402
Net Income (mill) 2849 2214
Earnings Per Share  3.33 2.86
Dividend per share 0.52 0.60
Shares outstanding (mill) 850 774
Book Value Per Share 18.7 18.0
Operating Cash Flow (mill) 4125 4430
Free Cash Flow (mill) -244 883
Interest Coverage — —
Current Ratio 0.81 0.88
Debt/Equity 0.52 0.53

Long term debt 8265 7400

Total equity 15895 13963
Sales/revenue per share 74.5 83.9
Operating income per share 6.2 5.7
Operating cash flow per share 4.9 5.7
Free cash flow per share -0.3 1.1
Capex 4369 3547
FCF margin -0.05 0.20

STDV 0.32
Average FCF margin 0.56
FCF coefficient variation 58%
10y avg EPS 3.4
10y avg FCF per share 4.2

10y avg free cash flow 2715

5y avg free cash flow 3764
3y avg free cash flow 4367

10y avg capex 4369

5y avg capex 2058
3yavg capex 1684

Financial strength 1 2
Y's to pay long term debt with net income 2.9 3.3
Y's pay long term debt with free cash flow -33.9 8.4
Debt/Equity 0.5 0.5
Current ratio 0.8 0.9
Interest coverage — —

Efficiency 1 2
FCF/Sales 0% 1%
CROIC -1% 4%
ROTC 11% 9%
ROE 18% 15%
Gross margin 33% 30%
Operating margin 8% 7%
Net margin 4% 3%
Return on retained earnings

Checklist ratios past 10 years 1 2

Dividend safety 9.3 9.5
Net income of cash flow from operation 69% 50%
Dividend payout ratio 16% 21%
Capex of operating cash flow 106% 80%
5 year cumulative capex of 5y cumulative net inc 112%

Earnings and growth stability past 10 years 1 2

EPS (Earnings per share) 3.33 2.86
Number of years of new high EPS
Number of years with positive EPS 1 1
Sales/revenue 63367 64948
Number of years new high revenue/sales 1
Free cash flow -244 883
Number of years of new high free cash flow
Number of years with positive FCF 0 1
Dividend 0.5 0.6
Number of years of new high dividend 1
Number of years with dividend payment 1 1
Operating income 5272 4402
Number of years new high operating income
Number of years with positive operating income 1 1
Operating cash flow 4125 4430
Number of years of new operating cash flow 1
Number of years with positive operating cash flow 1 1

Growth rates %. Different time periods 1y-8y 2y-9y

Free cash flow (FCF) -240.6 % 25.8 %
Sales/Revenue 2.0 % 1.8 %
EPS (Earnings per share) -196.4 % 9.2 %
Net income -192.4 % 6.2 %
Book Value per share 4.6 % 2.9 %
Operating income -2.1 % 1.6 %
Operating cash flow 1.1 % 4.0 %

Growth rates %. Different time periods 1y-8y 2y-9y

FCF/Sales -237.9 % 23.5 %
CROIC -239.8 % 25.6 %
ROTC -190.9 % 6.0 %
ROE -192.7 % 7.3 %
Gross margin -1.5 % 0.0 %
Operating margin -4.0 % -0.3 %
Net Margin -190.6 % 4.2 %

Historical valua
35

30

25

20

15

10

0
1 2 3 4 5 6 7
 10

0
1 2 3 4 5 6 7

Earnings grow
140

120

100

80

60

40

20

0
1 2 3 4 5 6 7
-20

Earnings grow
Revenue / sales (mill) Operating Income (mill)
76000 7000
73301 73785
74000 72618 6000 5740
72000 71279 5272 5252 5322
69865 5000 4673 4779
69495 69577 4402 4535
70000
68000 67390 4000
66000 64948 65357 3000
64000 63367
2000
62000
60000 1000

58000 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Earnings Per Share  Dividend per share

6.00 5.3 3.00
4.7 4.9
5.00 4.3 4.5
4.0 2.50
4.00 3.3 3.3
2.9 3.1
3.00 2.00 1.90
2.00 1.58
1.50 1.32
1.00 1.10
0.00 1.00 0.84
1 2 3 4 5 6 7 8 9 10 11 0.60 0.66
-1.00 0.52
0.50
-2.00
-3.00 -2.6 0.00
1 2 3 4 5 6 7 8
4.00 3.3 3.3
2.9 3.1
3.00 2.00 1.90
2.00 1.58
1.50 1.32
1.00 1.10
0.00 1.00 0.84
1 2 3 4 5 6 7 8 9 10 11 0.60 0.66
-1.00 0.52
0.50
-2.00
-3.00 -2.6 0.00
1 2 3 4 5 6 7 8
Year number
Year number

Operating Cash Flow (mill) Free Cash Flow (mill)

8000 6000
6871
7000 6520 5000
5881 5844 4152
6000
5271 5434 5325 5436 4000
5000 3142 3067
4430 4439 2653
4125 3000
4000 2048
2000
3000 1066
883
1000
2000
1000 0
1 2 3 4 5 6 7 8
-244
0 -1000
1 2 3 4 5 6 7 8 9 10 11
Year number
Year number

Sales/revenue per share Operating income per share

140 10
123.8 8.7
116.7 119.2 9
120 110.6 111.2 113.5 7.8
102.3 8 7.2 7.5
7.1
100 92.4 7
83.9 86.7 6.2 6.2
6 5.7
80 74.5
5
60 4
40 3
2
20
1
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Efficiency
35%

30%

25%

20%

15%

10%

5%

0%
1 2 3 4 5 6 7
-5%
 10%

5%

0%
1 2 3 4 5 6 7
-5%

-10%

-15%

FCF/Sales CROIC
8% 30%
7%
7% 6% 25%
6%
6% 6%
5% 20% 18%
5% 4%
4% 4% 15% 12% 12%
3% 11%
3% 10% 8%
2% 1% 2% 4% 4%
5%
1%
0% 0%
1 2 3 4 5 6 7 8 9 10 11 1
-1% 2 3 4 5 6 7 8
-1% 0% -5%
Year number Year number

ROE Operating margin

30% 9% 8%
25% 25% 8% 8%
25% 23% 8% 8%
7%
20% 18% 19% 19% 19% 7% 7% 7%
17% 6%
15%
15% 12% 6%
10% 5%
5% 4%
0% 3%
1 2 3 4 5 6 7 8 9 10 11
-5% 2%
-10% 1%
-11%
-15% 0%
1 2 3 4 5 6 7 8
Year number
Year number

Financial stren
Y's to pay long term debt with net inc. Y's pay long term debt with F
6 20
4.8
3.6 8.4 10.0
4 3.3 3.1 3.5 10
2.9 3.0 3.3 4.4 3.1 3.3
2.3 2.3 2.2 1.9
2 0
1 2 3 4 5 6 7 8
0 -10
1 2 3 4 5 6 7 8 9 10 11
-2 -20

-4 -30
-33.9
-6 -5.4 -40
Year number Year number
 0 -10
1 2 3 4 5 6 7 8 9 10 11
-2 -20

-4 -30
-33.9
-6 -5.4 -40
Year number Year number

Current ratio Interest coverage

1.2 8
6.91 7.05
0.97 7
1 0.93 6.13
0.88 0.87 0.89 0.88 0.88 0.86 5.82
0.81 0.83 6
0.78
0.8
5
0.6 4 3.76

3
0.4
2
0.2
1
0 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number

Checklist ratios &

Dividend safety Net inc of cash flow from opera
14 11.817779921228 80% 69%
2 55% 54% 56%
12 60% 50%
9.5391903531438
9.3325791855203 42%
6 10 4 8.6076817558299 40%
1 30%
7.2327964860907
8 8 6.4377258634649
6.0846016728369 20%
7 2 5.0941577698695
6 1
4.0190453658248 0%
3.6504934210526
4.2809423347398 1 2 3 4 5 6 7 8
3 1
4 -20%

2 -40% -37%
0 -60%
1 2 3 4 5 6 7 8 9 10 11
Year number
Year number

Capex of operating cash flow Shares outstanding (mill)

120% 900 850
106% 774
800 754 729
100% 683
700 663 641 640
80% 80%
80% 600
62% 500
60% 53%
400
40% 40%
40% 29% 30% 300
25% 28%
200
20%
100
0% 0
1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8
Year number Year number
 Intrinsic Valuation methods
2 Stage DCF valuation

5y average free cash flow: 3,213

Years: 1-3 4-7

Growth Rate: 3% 2%

Terminal Growth Rate: 2% Discount Rate:

Shares Outstanding: 562 MOS:

Year Flows Growth

1 3,310 3%
2 3,410 3%
3 3,514 3%
4 3,599 2%
5 3,686 2%
6 3,776 2%
7 3,867 2%
8 3,961 2%
9 4,038 2%
10 4,117 2%

Terminal Year 4199

PV of Year 1-10 Cash Flows: 21507
Terminal Value: 27851
Total PV of Cash Flows: 49358
Number of Shares: 562
Intrinsic Value (IV): 88

Katsenelsons Absolute P/E Valuation

No Growth P/E 7
EPS Growth Rate % 3.5 % Points
Dividend Yield % 3.93% Points
Basic P/E 13.4
Business Risk 1 Adjustment
Financial Risk 0.90 Adjustment
Earnings stability 1.10 Adjustment
5y average EPS 3.09
Current Stock Price 61.00
Fair Value P/E 13.2
Intrinsic Value 41

Benjamin Grahams Growth Formula

Normalized EPS Using The ROE Method:
10y median ROE 18.5 %
Shareholders Equity (TTM) 11420
Normalized Net Income 2115
Shares Outstanding 562
Normalized EPS 3.76
Normalized EPS Using The Net Margin Method:
10 Year Average Net Profit Margin 3.4 %
Revenue (TTM) 69577
Normalized Net Income 2361
Normalized EPS 4.20
Average Normalized EPS 3.98
20y AA Corp Bond Rate 2.95
Estimated Future EPS Growth Rate 3.54
Current Stock Price 61.00
Intrinsic Value 65

Classic Value investors valuation Year

Current Stock Price 61.00 1
5 year average EPS 3.09 2
Dividend pay out ratio 23% 3
EPS growth rate (1st five years) 3.5 % 4
EPS Growth Rate (2nd Five Years) 2.8 % 5
Discount Rate 11% 6
P/E Ratio in 10 Years ( 10y median p/e ratio) 15.8 7
8
9
10

Value of Future Dividends Today 4.82 Year

Value of Future Sales Price Today 23.48 10
Intrinsic Value Of The Stock 28

P/E valuation
5y average EPS 3.09
Average historical P/E 15.8
EPS growth rate 4%
Growth decline rate 2%
Discount rate 11%

Year EPS*Growth rate

1 3.20
2 3.31
3 3.42
4 3.53
5 3.65
6 3.77
7 3.88
8 4.00
9 4.12
10 4.25
Value in 10 years 67
Intrinsic Value 40

Book value growth + Dividend valuation

Current Stock Price 61.00
Annual Dividend 2.40
Years Of Future Value Calculation 10
Discount Rate - 10 yr. Fed Note 2.26%
Future Book Value 46
Book Value Growth Rate 3.7 %
Book value growth adjusted for share buybacks 8.4 %
Current Year Book Value 20.32
Intrinsic Value 58

Projected Annual Compounding Return

10y Median Return On Equity 18.5 %
Percentage Of Earnings Retained 77%
Estimated Book Value Growth 3.7 %
Number Of Years 10
Present Book Value 20.32
Future Book Value -29
Converting Percentage To Decimal 0.185
Future Per Share Earnings 5.4
Terminal value 86
Intrinsic Value 30

ROE valuation
Shareholders equity (TTM) 11420
Current stock Price 61
10y median Return on Equity (avg) 18.5 %
Shares outstanding 562
Dividend Yield 3.93%
Dividend payout ratio 23%
Desired Margin of Safety 40%
Conservative growth rate 8.6 %
Discount rate 11%

Calculations (per share)

Year Total Equity Dividend
1 22.07 2.61
2 23.96 2.83
3 26.02 3.07
4 28.26 3.34
5 30.69 3.62
6 33.33 3.94
7 36.20 4.28
8 39.31 4.64
9 42.69 5.04
10 46.36 5.48
Year 10 EPS 8.59
Required value 78.05
NPV required value 27.49
NPV dividends 26.06
Intrinsic value: 54

Keynumbers used in watchlist Ticker Date

TGT 10/13/2017
Market cap (mill) 34282 Valuation methods
3 stage DCF

Intrinsic value 47 Katsenelsons absolute p/e

Buyprice 28 B.Graham Formula

Margin of safety -29% Classic Value Valuation

Total quality score 35% P/E Valuation

Company Quality Low Book Value I.V

Buy/hold/sell? Consider sell Projected compounding

ROE Valuation
Median
Share buybacks Data
10y 4.7 % Valuation ratios
5y 3.4 % P/E
3y 4.4 % P/E Yield
1y 3.7 % P/B
P/S
P/operating cash flow
Growth rates Median Shiller P/E
FCF (Free cash flow) 3% P/Operating income
Sales/revenue 2% Operating income/p yield
EPS (Earnings per share) 4% EV/Operating income
Book value growth 4% Operating income/EV yield
Operating income 0% EV/FCF
Operating cash flow 2% FCF/Enterprise yield
Dividend 10y growth 18% P/FCF
FCF/price yield
Dividend yield
Earnings stability 10y Data Shareholders Yield
Years of EPS Growth 4 Peter Lynch PEG ratio
Y's of positive EPS 10 Warren Buffets's ratio
Y's of revenue growth 6
Y's of FCF Growth 3 Efficiency
Y's of positive FCF 10 FCF/Sales
Y's of dividend growth 11 CROIC
Y's of dividend paid 11 ROTC
Y's of oper. inc. growth 2 ROE
Y's of pos.operating inc. 11 Gross margin
Y's of O.C.F growth 4 Operating margin
Y's of positive O.C.F 11 Net margin
FCF covariation 58% Return on retained earnings

Financial strength
Efficiency growth Median Y's to pay debt with net.Inc
FCF/Sales 1.6 % Y's to pay debt with FCF
CROIC 7.0 % Debt/Equity
ROTC -0.1 % Current ratio
ROE 2.1 % Interest coverage
Gross Margin -0.8 % F-Score
Operating margin -1.2 % Z-Score
Net margin -1.6 % M-Score

Checklist ratios
Dividend safety
Net Inc of cash from operation
Dividend payout ratio
Capex of operating cash flow
Cum. capex of Cum. net inc

3 4 5 6

16.9 15.8 12.0 13.1

2.4 2.8 2.3 2.4
0.6 0.7 0.5 0.6
6.4 7.8 6.6 6.8

3 4 5 6
65357 67390 69865 73301
4673 5252 5322 5740
2488 2920 2929 2999
3.30 4.00 4.28 4.52
0.66 0.84 1.10 1.32
754 729 683 663
20.1 22.0 23.6 25.1
5881 5271 5434 5325
4152 3142 1066 2048
5.82 6.91 6.13 7.05
0.87 0.89 0.88 0.83
0.51 0.64 0.66 0.54

7733 10264 10656 8997

15163 16038 16146 16661
86.7 92.4 102.3 110.6
6.2 7.2 7.8 8.7
7.8 7.2 8.0 8.0
5.5 4.3 1.6 3.1
1729 2129 4368 3277
0.89 0.60 0.20 0.36

3 4 5 6
3.1 3.5 3.6 3.0
1.9 3.3 10.0 4.4
0.5 0.6 0.7 0.5
0.9 0.9 0.9 0.8
5.8 6.9 6.1 7.1

3 4 5 6
6% 5% 2% 3%
18% 12% 4% 8%
9% 11% 11% 11%
17% 19% 19% 19%
30% 31% 32% 31%
7% 8% 8% 8%
4% 4% 4% 4%

3 4 5 6
11.8 8.6 7.2 6.1
42% 55% 54% 56%
20% 21% 26% 29%
29% 40% 80% 62%

3 4 5 6
3.30 4.00 4.28 4.52
1 2 3
1 1 1 1
65357 67390 69865 73301
 2 3 4 5
4152 3142 1066 2048
1
1 1 1 1
0.7 0.8 1.1 1.3
2 3 4 5
1 1 1 1
4673 5252 5322 5740
1 2
1 1 1 1
5881 5271 5434 5325
2
1 1 1 1

3y-10y 1y-6y 2y-7y 3y-8y

-0.9 % -253.0 % 28.3 % -8.6 %
0.9 % 3.0 % 1.9 % 2.1 %
5.2 % 6.3 % 1.4 % -195.2 %
1.4 % 1.0 % -2.3 % -192.0 %
-0.1 % 6.1 % 7.2 % 4.9 %
0.9 % 1.7 % 1.7 % -0.6 %
-1.1 % 5.2 % 8.0 % -5.5 %

3y-10y 1y-6y 2y-7y 3y-8y

-1.8 % -248.6 % 25.9 % -10.5 %
2.6 % -251.2 % 23.4 % -10.3 %
2.5 % -1.2 % -0.3 % -190.9 %
4.2 % 0.1 % -4.7 % -191.2 %
-0.3 % -1.0 % 0.2 % -0.6 %
0.0 % -1.2 % -0.2 % -2.7 %
0.5 % -1.9 % -4.1 % -190.0 %

Historical valuation

P/E
P/B
P/S
P/Operating cash flow

6 7 8 9 10 11
 P/Operating cash flow

6 7 8 9 10 11

Earnings growth

Sales/revenue per share

Operating cash flow per share
Operating income per share
Earnings Per Share 
Free cash flow per share
Book Value Per Share
Dividend per share

6 7 8 9 10 11

Earnings growth
Operating Income (mill) Net Income (mill)
4000
3363
5740 2920 2929 2999
5252 5322 3000 2849 2488
2737 2778
4673 4779 4910 4969 4700 2214
4402 4535 1971
2000

1000

0
1 2 3 4 5 6 7 8 9 10 11
-1000

-2000 -1636
2 3 4 5 6 7 8 9 10 11
Year number
Year number

Dividend per share Book Value Per Share

30
25.1 25.6 25.6
2.32 2.40 25 23.6
2.16 22.0 22.0
20.1 19.9 20.3
1.90 20 18.7 18.0
1.58
1.32 15
1.10
0.84 10
0.60 0.66
5

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
 2.16
20.1 19.9 20.3
1.90 20 18.7 18.0
1.58
1.32 15
1.10
0.84 10
0.60 0.66
5

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Free Cash Flow (mill) Free cash flow per share

10
8.5
4805
4406 8 7.0
4152 6.7
3889
3142 6 5.5
3067 4.8
2653 4.3 4.1
2048 4 3.1

883 1066 2 1.6

1.1

0
2 3 4 5 6 7 8 9 10 11 1
-0.3 2 3 4 5 6 7 8 9 10 11
-2
Year number Year number

Operating income per share Operating cash flow per share

14
8.7 8.5 12.2
8.4
7.8 7.8 12
7.2 7.5 10.2
7.1
10 9.2 9.3
6.2
5.7 7.8 8.0 8.0
8 7.2 6.9
5.7
6 4.9
4

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Efficiency

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

5 6 7 8 9 10 11
 CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

5 6 7 8 9 10 11

CROIC ROTC
28% 15% 13%
11% 11% 11% 12%
11% 11%
22% 10% 9% 9%
20% 8%
18%
5%
12% 12%
11%
8% 0%
4% 4% 1 2 3 4 5 6 7 8 9 10 11

-5%
2 3 4 5 6 7 8 9 10 11 -6%
-10%
Year number Year number

Operating margin Net margin

5% 4% 4% 5%
8% 8% 4% 4% 4% 4%
8% 4% 4%
7% 7% 3%
7% 7% 7% 7% 3%
6% 3%
2%
1%
0%
1 2 3 4 5 6 7 8 9 10 11
-1%
-2%
-2%
-3%
2 3 4 5 6 7 8 9 10 11
Year number
Year number

Financial strength
Y's pay long term debt with FCF Debt/Equity
0.7 0.64 0.66
8.4 10.0 0.6 0.58
0.53 0.54 0.54 0.55 0.54 0.53
3.3 4.4 3.1 3.3 0.52 0.51
1.9 1.7 1.6 1.3 0.5
2 3 4 5 6 7 8 9 10 11
0.4

0.3

0.2

0.1

0
1 2 3 4 5 6 7 8 9 10 11
Year number
Year number
 0.3

0.2

0.1

0
1 2 3 4 5 6 7 8 9 10 11
Year number
Year number

Interest coverage Long term debt

12000
6.91 7.05 10264 10656
6.13 10000 9503
5.82 8997 8837
8265
8000 7400 7733 7651
6265 6053
3.76 6000

4000

2000

0
2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11
Year number Year number

Checklist ratios & Misc

Net inc of cash flow from operation Dividend payout ratio
60% 51% 49% 49%
55% 56% 58% 41%
50% 54% 50% 40%
26% 29%
42% 40% 21% 20% 21%
30% 20% 16%

0%
1 2 3 4 5 6 7 8 9 10 11
-20%
2 3 4 5 6 7 8 9 10 11
-40%

-37% -60%

-80% -74%
Year number Year number

Shares outstanding (mill) FCF vs EPS

6000
774 754 5000
729 Net Income (mill)
683 663 641 640 632 4000
583 562 Free Cash Flow (mill)
3000
2000
1000
0
1 2 3 4 5 6 7 8 9 10 11
-1000
-2000
2 3 4 5 6 7 8 9 10 11
Year number
ods

8-10
2%

11%

40%

Value
2,982
2,768
2,569
2,371
2,188
2,019
1,863
1,719
1,579
1,450

P/E Exp EPS Grwth Rate Dividend Yield Add'l P/E Points
7.00 0% 0.0% 0.0
7.65 1% 0.1% 0.5
8.30 2% 0.5% 0.5
2.3 8.95 3% 1.0% 1.0
4.0 9.60 4% 1.5% 1.5
10.25 5% 2.0% 2.0
10.90 6% 2.5% 2.5
1.00 11.55 7% 3.0% 3.0
12.20 8% ∆0.65 3.5% 3.5
1.10 12.85 9% 4.0% 4.0
0.90 13.50 10 % 4.5% 4.5
14.15 11 % 5.0% 5.0
14.80 12 % 5.5% 5.5
15.45 13 % 6.0% 6.0
16.10 14 % 6.5% 6.5
16.75 15 % 10.0% 10.0
17.40 16 %
17.90 17 %
18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
21.90 25 %
 18.40 18 %
18.90 19 %
19.40 20 %
19.90 21 % ∆0.50
20.40 22 %
20.90 23 %
21.40 24 %
21.90 25 %

Projected EPS Pay out ratio Dividends Disc. Divid.

3.2 23% 0.7 0.65
3.3 23% 0.7 0.61
3.4 23% 0.8 0.57
3.5 23% 0.8 0.53
3.7 23% 0.8 0.49
3.8 23% 0.9 0.46
3.9 23% 0.9 0.42
4.0 23% 0.9 0.39
4.1 23% 0.9 0.36
4.2 23% 1.0 0.34
Sum 4.82
Projected EPS PE ratio in 10 years Terminal value Disc. term. V.
4.2 15.8 66.66 23.48
NPV dividends
2.61
2.61
2.61
2.61
2.61
2.61
2.61
2.61
2.61
2.61

F-Score Z-score M-score Interest coverage (TTM)

6 3.20 -2.97 —
Intrinsic value Buyprice Margin of safety
88 53 31%
41 25 -49%
65 39 6%
28 17 -116%
40 24 -53%
58 35 -6%
30 18 -102%
54 32 -14%
47 28 -32%

TTM 10y avg 5y avg

12.3 15.8 18.1
8.1 % 5.6 % 4.9 %
3.0 2.7 3.1
0.5 0.6 0.6
5.0 7.6 8.0
17.8
7.3
13.7 %
9.2
10.9 %
9.0
11.1 %
7.1
14.0 %
3.9 %
7.7 %
0.60
2.64

TTM 10y avg 5y avg

7% 4% 4%
28% 12% 15%
12% 9% 7%
25% 16% 14%
30% 30% 30%
7% 7% 7%
4% 3% 3%
7.2 %

TTM 10y avg 5y avg

2.2 2.3 1.4
 1.3 0.5 2.8
0.5 0.6 0.6
0.8 0.9 0.9
— 5.9 5.4
6
3
-2.97

TTM 10y avg 5y avg

5.1 6.9 4.9
40% 43% 32%
49% 23% 19%
30% 52% 42%
116% 112%

7 8 9 10 TTM
Visually

17.0 31.8 16.2 13.4 12.2

2.5 3.0 3.4 3.7 3.0
0.6 0.7 0.6 0.6 0.5
6.1 12.7 7.6 8.8 4.9

7 8 9 10 TTM Visually
71279 72618 73785 69495 69577
4779 4535 4910 4969 4700
1971 -1636 3363 2737 2778
3.07 -2.58 5.31 4.70 4.94
1.58 1.90 2.16 2.32 2.40
641 640 632 583 562
25.6 25.6 22.0 19.9 20.3
6520 4439 5844 5436 6871
3067 2653 4406 3889 4805
3.76 — — — —
0.88 0.97 0.93 0.86 0.78
0.58 0.54 0.55 0.54 0.53

9503 8837 7651 6265 6053

16384 16365 13910 11602 11420
111.2 113.5 116.7 119.2 123.8
7.5 7.1 7.8 8.5 8.4
10.2 6.9 9.2 9.3 12.2
4.8 4.1 7.0 6.7 8.5
3453 1786 1438 1547 2066
0.64 0.59 0.90 0.78 1.02

7 8 9 10 TTM 10y Average

4.8 -5.4 2.3 2.3 2.2 2.3
3.1 3.3 1.7 1.6 1.3 0.5
0.6 0.5 0.6 0.5 0.5 0.6
0.9 1.0 0.9 0.9 0.8 0.9
3.8 — — — — 5.9

7 8 9 10 TTM 10y Average

4% 4% 6% 6% 7% 4%
12% 11% 20% 22% 28% 12%
8% -6% 13% 11% 12% 9%
12% -11% 25% 23% 25% 16%
30% 29% 30% 30% 30% 30%
7% 6% 7% 7% 7% 7%
3% -2% 5% 4% 4% 3%
7%

7 8 9 10 TTM 10y Average

6.4 3.7 4.3 4.0 5.1 6.9
30% -37% 58% 50% 40% 43%
51% -74% 41% 49% 49% 23%
53% 40% 25% 28% 30% 52%

7 8 9 10 TTM
3.07 -2.58 5.31 4.70 4.94
4
1 0 1 1 1
71279 72618 73785 69495 69577
 6
3067 2653 4406 3889 4805
2 3
1 1 1 1 1
1.6 1.9 2.2 2.3 2.4
6 7 8 9 10
1 1 1 1 1
4779 4535 4910 4969 4700

1 1 1 1 1
6520 4439 5844 5436 6871
3 4
1 1 1 1 1

4y-9y 5y-10y Median

7.0 % 29.5 % 3.0 %
1.8 % -0.1 % 1.9 %
5.8 % 1.9 % 3.5 %
2.9 % -1.3 % -0.2 %
0.0 % -3.4 % 3.7 %
-1.3 % -1.4 % 0.1 %
2.1 % 0.0 % 1.6 %

4y-9y 5y-10y Median

5.1 % 29.7 % 1.6 %
11.3 % 40.5 % 7.0 %
3.5 % 0.1 % -0.1 %
5.7 % 4.1 % 2.1 %
-0.9 % -1.2 % -0.8 %
-3.1 % -1.3 % -1.2 %
1.0 % -1.2 % -1.6 %

P/E
P/B
P/S
P/Operating cash flow
 P/Operating cash flow

/revenue per share

ating cash flow per share
ating income per share
ngs Per Share 
cash flow per share
Value Per Share
end per share

3363
2737 2778

8 9 10 11

-1636

re
25.6
22.0
19.9 20.3

8 9 10 11
 19.9 20.3

8 9 10 11

are
8.5
7.0 6.7

4.1

8 9 10 11

share
12.2

9.2 9.3

6.9

8 9 10 11

FCF/Sales
CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin
 CROIC
ROTC
ROE
Gross margin
Operating margin
Net margin

13%
11% 12%

8 9 10 11

-6%

5%
4% 4%

8 9 10 11

-2%

0.54 0.55 0.54 0.53

8 9 10 11
 8 9 10 11

8837
7651
6265 6053

8 9 10 11

tio
49% 49%
41%

8 9 10 11

-74%

8 9 10 11
Interest coverageDebt/Equity
10y avg (TTM)
Debt/Equity 10y avg
Current ratio
Current
(TTM)ratio
Y's to10y
payavg
debt with net inc (TTM)
5.9 0.5 0.6 0.8 0.9 2.2
Y's to pay debt with net inc 10y avg Years to pay debt with FCF
Years
(TTM)
to pay debt with
FCF
FCF
(Free
10ycash
avg flow)
2.3 1.3 0.5 3%
 Datainput from Morningstar.com

Morningstar valuation ratios

TGT 14.7 10.5 16.9 15.8 12 13.1 17
S&P 500 16.5 10.9 18.6 15.5 13.7 15 18.6
Price/Book
TGT 2.6 1.9 2.4 2.8 2.3 2.4 2.5
S&P 500 2.7 1.7 2.2 2.2 2 2.1 2.6
Price/Sales
TGT 0.7 0.4 0.6 0.7 0.5 0.6 0.6
S&P 500 1.5 0.9 1.2 1.3 1.2 1.3 1.7
Price/Cash Flow
TGT 9.1 6.3 6.4 7.8 6.6 6.8 6.1
S&P 500 11.6 6.8 9.1 9.3 8.5 9.2 11.2

Morningstar key ratios

Revenue USD Mil 63367 64948.00 65357 67390 69865 73301 71279

Gross Margin % 32.6 29.50 30.3 30.9 31.5 31 29.8

Operating Income USD Mil 5272 4402.00 4673 5252 5322 5740 4779

Operating Margin % 8.3 6.8 7.1 7.8 7.6 7.8 6.7

Net Income USD Mil 2849 2214 2488 2920 2929 2999 1971

Earnings Per Share USD 3.33 2.86 3.3 4 4.28 4.52 3.07

Dividends USD 0.52 0.6 0.66 0.84 1.1 1.32 1.58

Payout Ratio % * 15.6 17.6 22.7 21 25.7 28 40.6

Shares Mil 850 774 754 729 683 663 641

Book Value Per Share * USD 18.7 18.04 20.11 22 23.64 25.13 25.56

Operating Cash Flow USD Mil 4125 4430 5881 5271 5434 5325 6520

Cap Spending USD Mil -4369 -3547 -1729 -2129 -4368 -3277 -3453

Free Cash Flow USD Mil -244 883 4152 3142 1066 2048 3067
Free Cash Flow Per Share * USD -0.29 0.68 4.66 4.31 1.56 4.27 4.57

Working Capital USD Mil 7124 6976 7097 7143 2162 2357 -1204

Morningstar profitability tab

Tax Rate % 38.4 37.39 35.74 35.04 34.27 34.93 36.48

Net Margin % 4.5 3.41 3.81 4.33 4.19 4.09 2.72

Asset Turnover (Average) 1.55 1.47 1.47 1.53 1.55 1.55 1.57

Return on Assets % 6.96 4.99 5.61 6.62 6.48 6.33 4.25

Financial Leverage (Average) 2.91 3.22 2.9 2.82 2.95 2.91 2.74

Return on Equity % 18.42 15.26 17.12 18.94 18.71 18.52 12.02

Return on Invested Capital % 11.19 8.5 9.29 10.77 11.02 10.51 8.37

Interest Coverage — — 5.82 6.91 6.13 7.05 3.76

Morningstar financial health tab

Current Ratio 0.81 0.88 0.87 0.89 0.88 0.83 0.88

Quick Ratio 0.16 0.2 0.22 0.21 0.2 0.2 0.2

Financial Leverage 2.53 2.5 2.41 2.64 2.71 2.66 2.69

Debt/Equity 0.52 0.53 0.51 0.64 0.66 0.54 0.58

Sales/revenue EPS (Earnings per share)Book valueOperating
growth Operating
incomeDividend
cash flow
10y
FCF/Sales
growth
FCF/sales
(TTM) 10y
CROIC
avg (TTM)
2% 4% 4% 0% 2% 18% 7% 4% 28%
.com

31.8 16.2 13.4 12.2

18.6 19 20.3 22

3 3.4 3.7 3
2.7 2.7 2.8 3.1

0.7 0.6 0.6 0.5

1.8 1.8 2 2.1

12.7 7.6 8.8 4.9

11.5 11.5 12.4 13.7

72618 73785 69495 69577

29.4 29.5 29.7 29.5

4535 4910 4969 4700

6.2 6.7 7.2 6.8

-1636 3363 2737 2778

-2.58 5.31 4.7 4.94

1.9 2.16 2.32 2.4

76 47.3 42.1 48.5

640 632 583 562

25.57 22.01 19.9 20.32

4439 5844 5436 6871

-1786 -1438 -1547 -2066

2653 4406 3889 4805

2.56 7.18 5.7 —

2351 1508 -718 —

32.96 32.54 32.69 32.87

-2.25 4.56 3.94 3.99

1.69 1.8 1.78 1.86

-3.81 8.24 7.05 7.44

2.96 3.11 3.42 3.37

-10.82 24.95 22.89 24.5

-5.76 12.81 11.08 11.66

— — — —

0.97 0.93 0.86 0.78

0.24 0.22 0.19 0.16

2.5 2.48 2.56 2.64

0.54 0.55 0.54 0.53

CROIC 10yROTC
avg (TTM)
ROTC 10y ROE
avg (TTM) ROE 10y avg Operating margin (TTM)
12% 12% 9% 25% 16% 7%
Operating margin 10y avgNet margin (TTM) Net margin 10y avg Return on retained earnings
7% 4% 3% 7.2 %
Years of EPS Growth Y's of positive EPS Y's of revenue growth Y's of FCF Growth
4 10 6 3
Y's of positive FCF Y's of dividend growth Y's of dividend paid Y's of oper. inc. growth
10 11 11 2
Y's of pos.operating inc. Y's of O.C.F growth Y's of positive O.C.F FCF covariation
11 4 11 58%
Dividend safety (TTM) Dividend safety 10y avg
5.1 6.9
Net inc of cash flow from operation (TTM)
Net inc of cash flow from operation 10y avg
40% 43%
Dividend payout ratio (TTM) Dividend payout ratio 10y avg
49% 23%
Capex of operating cash flow
Capex
(TTM)
of operating cash flow10y
10y avg 5y 3y 1y P/E (TTM)
30% 52% 4.7 % 3.4 % 4.4 % 3.7 % 12.3
P/E 10y avg P/B (TTM) P/B 10y avg P/S (TTM) P/S 10y avg
15.8 3.0 2.7 0.5 0.6
P/operating cash flow (TTM)
P/operating cash flow 10y
P/FCF
avg (TTM) Shiller P/E
5.0 7.6 7.1 17.8
P/Operating income (TTM) FCF/market cap yield (TTM)Dividend yield (TTM)
Shareholder yield (TTM)
7.3 14.0 % 3.9 % 7.7 %
Peter Lynch ratio (TTM)
Warren Buffets ratio (TTM)
EV/Operating income (TTM) FCF/Enterprise yield (TTM)
0.60 2.64 9.2 11.1 %
Total quality score Company quality Current stock price Intrinsic value Buyprice
35% Low 61 47 28
Margin of safetyBuy/Hold/Sell
-29% Consider sell
Ticker Date F-Score Z-score M-score Interest coverage (TTM) Interest coverage 10y avg
TGT 10/13/2017 6.0 3.2 -3.0 — 5.9
NKE 10/13/2017 5.0 7.2 -2.3 — 712.0
BBBY 10/15/2107 6.0 5.3 -2.6 — 0
 Financial strength
Debt/Equity (TTM) Debt/Equity 10y avg Current ratio (TTM) Current ratio 10y avg
0.5 0.6 0.8 0.9
0.3 0.1 2.7 2.9
0.6 0.6 1.8 2.4
al strength
Y's to pay debt with net inc (TTM) Y's to pay debt with net inc 10y avg
2.2 2.3
0.9 0.4
2.7 0.8
Years to pay debt with FCF (TTM) Years to pay debt with FCF 10y avg FCF (Free cash flow)
1.3 0.5 3%
1.5 0.6 9%
2.6 0.9 6%
 Growth rates
Sales/revenue EPS (Earnings per share) Book value growth Operating income
2% 4% 4% 0%
8% 14% 8% 10%
8% 15% 7% 9%
Operating cash flow Dividend 10y growth FCF/Sales (TTM) FCF/sales 10y avg CROIC (TTM)
2% 18% 7% 4% 28%
10% 14% 7% 8% 15%
7% 5% 7% 13%
 Efficiency
CROIC 10y avg ROTC (TTM) ROTC 10y avg ROE (TTM) ROE 10y avg Operating margin (TTM)
12% 12% 9% 25% 16% 7%
17% 26% 23% 33% 25% 13%
18% 14% 20% 21% 24% 8%
Operating margin 10y avg Net margin (TTM) Net margin 10y avg Return on retained earnings
7% 4% 3% 7%
13% 11% 10% 12%
12% 5% 8% 4%
Years of EPS Growth Y's of positive EPS Y's of revenue growth Y's of FCF Growth
4 10 6 3
8 11 9 2
7 11 9 4
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 Earnings stability
Y's of positive FCF Y's of dividend growth Y's of dividend paid Y's of oper. inc. growth
10 11 11 2
11 11 11 8
11 11 11 4
Y's of pos.operating inc. Y's of O.C.F growth Y's of positive O.C.F FCF covariation
11 4 11 58%
11 2 11 33%
11 4 11 20%
Dividend safety (TTM) Dividend safety 10y avg Net inc of cash flow from operation (TTM)
5.1 6.9 40%
2.8 3.7 115%
12.3 15.3 60%
 Checklist ratios
Net inc of cash flow from operation 10y avg Dividend payout ratio (TTM)
43% 49%
97% 31%
77% 14%
Dividend payout ratio 10y avg Capex of operating cash flow (TTM)
23% 30%
29% 32%
11% 39%
 Share buybacks
Capex of operating cash flow 10y avg 10y 5y 3y 1y P/E (TTM) P/E 10y avg
52% 5% 3% 4% 4% 12.3 15.8
26% 2% 2% 2% 0% 21.6 22.8
31% 7% 10% 9% 4% 5.5 13.6
P/B (TTM) P/B 10y avg P/S (TTM) P/S 10y avg P/operating cash flow (TTM)
3.0 2.7 0.5 0.6 5.0
6.9 5.4 2.5 2.3 25.0
1.1 3.1 0.3 1.1 3.3
 Valuation metrics
P/operating cash flow 10y avg P/FCF (TTM) Shiller P/E P/Operating income (TTM)
7.6 7.1 17.8 7.3
21.2 36.7 33.6 18.5
10.6 5.4 5.7 3.2
Valuation metrics
FCF/market cap yield (TTM) Dividend yield (TTM) Shareholder yield (TTM)
14.0 % 3.9 % 7.7 %
2.7 % 1.4 % 1.9 %
18.7 % 2.5 % 6.7 %
Peter Lynch ratio (TTM) Warren Buffets ratio (TTM) EV/Operating income (TTM)
0.6 2.6 9.2
0.7 1.9 17.5
3.2 6.4 4.3
 Company Quality Intrinsic Value
FCF/Enterprise yield (TTM) Total quality score Company quality Current stock price
11.1 % 35% Low 61
2.9 % 71% Very good 50.80
14.0 % 58% Very good 21.23
 Intrinsic Value
Intrinsic value Buyprice Margin of safety Buy/Hold/Sell
47 28 -29% Consider sell
39 27 -31% Consider sell
49 29 57% Buy
I do not take any responsibility for any loss that might occur using this spreadsheet choosing stocks.

Works best for stable and mature companies with at least 10 years of financial data.

This sheet gives you the quantitative analysis of the stock, however you should also always look into the qualitative aspect

I can’t guaranty that all of the calculations and formulas in this spreadsheet are 100% correct, typing error and mistakes in

There is no guaranty that the financial data from a secondary source is 100% correct.
into the qualitative aspect of the stock before you buy

ping error and mistakes in the formulas might happen.