Company Financials
Balance Sheet Items
Free Cash Flow Projection
Sensitivity Analysis
| Year | FCF ($M) | Discount Factor | Present Value ($M) |
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Bull, Base & Bear Case Analysis
Compare different scenarios to understand the range of possible outcomes and risk-reward profiles.
š» Bear Case
š Base Case
š Bull Case
Financial Ratio Analysis
Analyze key financial ratios and compare with industry benchmarks to assess company performance.
Company Data
Industry Benchmarks
Dividend Discount Model
Value dividend-paying stocks using the Gordon Growth Model and multi-stage dividend discount models.
Dividend Information
Dividend Growth Projection
Stock Valuation Fundamentals
Discounted Cash Flow (DCF) Analysis
DCF is a valuation method that estimates the value of an investment based on its expected future cash flows. The model discounts projected free cash flows back to present value using a discount rate (typically WACC - Weighted Average Cost of Capital).
Formula: DCF = Ī£ [FCFn / (1 + WACC)^n] + [Terminal Value / (1 + WACC)^n]
Key Valuation Ratios
- P/E Ratio: Price-to-Earnings ratio indicates how much investors are willing to pay per dollar of earnings.
- P/B Ratio: Price-to-Book ratio compares market value to book value, useful for asset-heavy companies.
- P/S Ratio: Price-to-Sales ratio is helpful for companies with no profits or comparing revenue multiples.
- ROE: Return on Equity measures how effectively a company uses shareholders' equity to generate profits.
Dividend Discount Model (DDM)
The DDM values a stock based on the present value of its expected future dividends. The Gordon Growth Model assumes constant dividend growth:
Formula: Stock Price = Dā / (r - g)
Where Dā = expected dividend, r = required return, g = dividend growth rate
Terminal Value Calculation
Terminal value represents the value of a company beyond the explicit forecast period, typically calculated using the perpetual growth method:
Formula: Terminal Value = (FCF_final Ć (1 + Terminal Growth)) / (WACC - Terminal Growth)
Terminal growth rates typically range from 2-4%, reflecting long-term economic growth expectations.
Margin of Safety
The margin of safety is the difference between a stock's intrinsic value and its market price. Benjamin Graham recommended buying stocks at least 25-30% below their intrinsic value to protect against valuation errors and market volatility.