Using real operating cash flow: excluding cash received for shares issued, and related tax effect; including deferred commission cashflow; subtracting real capex on servers, furniture etc (there's more for acquisitions but not a certain figure given a voracious acquisitive appetite):
Here's my spreadsheet.
Note fully diluted shares outstanding are now 149m, up by 14m in 1 year;
Table lets you impute a cashflow multiple, add back net cash on balance sheet.
I assume cashflow growth of 35% for f13 to jan13.
|Cashflow for yr to jan12||368||""=591-229+6||excluding shares sold and tax effect|
|less capex||91||capex ex acqtn|
|Grow at 35%||35%||373.95|
|Cash||777||777||777||777||777||cash + mkt securities less conv debtas at jan 2012|
|149||42.9||55.4||68||81||106||for 2011 sh 136 m, then moved to 149m!! For f13|
To summarise table below, a 40X operating cashflow multiple delivers a price target of 106$. 40x is ludicrously generous.
I prefer a 30X and this delivers a price target is $81
In other words, even after the slide on Thursday May 10th, there is ample downside risk once cloudy euphoric dreams are replaced with a dose of reality.
Disc: short and relieved!!
Disclosure: I am short CRM.