MeritValue

SHINHAN FINANCIAL GROUP CO LTD

SHGdata completeness 100%2 fiscal years on file
The thesis, from the filings

SHINHAN FINANCIAL GROUP CO LTD earns about 11% on invested capital, but has diluted owners by 3% over 2 years — worth asking whether the growth reaches owners. The cash-flow models don't apply cleanly here — the ledger says why below.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2009FY 2010
Revenue$10.8B1$11.5B2
Net income$974.4M3$2.52B4
Operating cash flow$1.47B5$5.66B6
Capital expenditure$328.5M7$250.4M8
Free cash flow (derived)$1.14B5$5.4B6
Total debt$46.8B9$48.3B10
Cash & equivalents$3.86B11$5.03B11
Diluted shares476.2M488.9M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$412.38
your share of equity
Profit it earned you last year
$51.46
Free cash flow it threw off
$110.54
Debt you’d be carrying
$987.15

10 shares is a claim on $412.38 of net worth that earned you $51.46 and generated $110.54 of cash last year, against $987.15 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
11% avg · 2y
FY09 9%FY10 12%

It earned an average 11% on invested capital over 2 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+3% shares · 2y

Share count is up 3% over 2 years — owners have been diluted. Worth asking what they got for it. Total debt has held roughly steady.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 2 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 2 years of FCF (need ≥3) — model not applicable
Earnings Power Value
not applicable
only 2 years of net income (need ≥3)
Graham Number
$66.25
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 20-F/A · period ending 2009-12-31 · accession 0000950123-10-067841 (InterestAndDividendIncomeOperating)
  2. 20-F/A · period ending 2010-12-31 · accession 0001193125-11-188821 (InterestAndDividendIncomeOperating)
  3. 20-F/A · period ending 2009-12-31 · accession 0000950123-10-067841 (NetIncomeLoss)
  4. 20-F/A · period ending 2010-12-31 · accession 0001193125-11-188821 (NetIncomeLoss)
  5. 20-F/A · period ending 2009-12-31 · accession 0000950123-10-067841 (NetCashProvidedByUsedInOperatingActivities)
  6. 20-F/A · period ending 2010-12-31 · accession 0001193125-11-188821 (NetCashProvidedByUsedInOperatingActivities)
  7. 20-F/A · period ending 2009-12-31 · accession 0000950123-10-067841 (PaymentsToAcquirePropertyPlantAndEquipment)
  8. 20-F/A · period ending 2010-12-31 · accession 0001193125-11-188821 (PaymentsToAcquirePropertyPlantAndEquipment)
  9. 20-F/A · period ending 2009-12-31 · accession 0000950123-10-067841 (LongTermDebt)
  10. 20-F/A · period ending 2010-12-31 · accession 0001193125-11-188821 (LongTermDebt)
  11. 20-F/A · period ending 2009-12-31 · accession 0001193125-11-188821 (CashAndCashEquivalentsAtCarryingValue)