I’m having trouble understanding the exit multiples you use for your valuation models in a lot of your videos. You usually select multiples ranging from 15-25 but that kind of feels arbitrary when some of the securities you’re analyzing have +10 years of multiples in the 30’s and 40’s. I understand the need for conservatism but at that point why not move up the discount rate along with the multiple assumptions. Genuine question, love your content, there’s a lot to like in the analysis you do
Thanks! I try to explain the reason why I use that multiple in each video, but it basically has to do with what I believe their long term growth rate it going to be in 2031. Even if a company was trading at high multiples in the past does not mean that they will continue to trade at high multiples. Normally growth slows over time.
Not sure where to request stock analysis, but wondering if you could take a look at MP Materials (rare earths)
I’m having trouble understanding the exit multiples you use for your valuation models in a lot of your videos. You usually select multiples ranging from 15-25 but that kind of feels arbitrary when some of the securities you’re analyzing have +10 years of multiples in the 30’s and 40’s. I understand the need for conservatism but at that point why not move up the discount rate along with the multiple assumptions. Genuine question, love your content, there’s a lot to like in the analysis you do
Thanks! I try to explain the reason why I use that multiple in each video, but it basically has to do with what I believe their long term growth rate it going to be in 2031. Even if a company was trading at high multiples in the past does not mean that they will continue to trade at high multiples. Normally growth slows over time.
Could you do BMY
Im not really an expert in pharmaceutical companies but I can try