3 ways to value a company - MoneyWeek Investment Tutorials
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- Опубликовано: 29 сен 2024
- Valuing a company is more art than science. Tim Bennett explains why and introduces three ways potential investors can get started.
Related links…
• How to value a company using discounted cash flow (DCF) - • How to value a company...
• How to value a company using net assets - • How to value a company...
• What is a balance sheet? • What is a balance shee...
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2:47 is why you clicked on this video :)
Not all hero wear brief over their pants. The world needs more people like you.
Thank you!
I actually found his house comparison to be very clear
Mirgul Zhumagulova Thank you
you are a hero!
this video was great. thank you
I want to do masters in valuation of a company but I haven't found the right course for it. If someone knows about it then please help me.
nice video but how about not whispering.. I know it's a British thing but it is really irritating when trying to watch a video to learn something. Speak up man.
all you own is a share of stock which ONLY worth anything when you sell
plus if you are going to buy a company your not going to start at a crackpot place like this.
Econmics ASMR
Hi. A few people have asked for some more detail on valuation techniques so I'll see what I can do...Tim.
Very structured and clair! Your series has become my go-to videos for my corporate finance class! Good job Tim!
luna xinran yi
lol i also come here for corporate finance
@@DanDan-mi4sf Dan Dan
Very clair, indeed.
Yeah - watch this space. I'll cover some more stuff on the basic techniques....
Hi. I did a short video on how to spot fallen angels that takes a quick look at this....
what are your thoughts on warren buffet valuing techniques? I love your videos Thank you and keep up the good work
I would say they're pretty profitable haha. Sorry, I know you weren't askin' me. Couldn't help myself.
best teacher I ever had
I don't find this very helpful because it is too vague, it would be better to pick a company and go through all 3 methods for us to understand
Hello sir I'm suman from india .I'm new investor .I understand your teaching .you're awesome.. Love from india
Can you please make a video about how to value an ecommerce? and give us some references where we can look at topics deeper?
Thank you for great series.
Your sound is comparatively low. Please try to develop this problem.
I have any issues with sound.
Loved the introduction!
how paste chart in multiple sheets ?
I love this channel
By far one of the best investment channels out there! I cant believe you do this for free. You are like a Jesus of Mammon!
Please make the video that delves deeper into the three approaches to company valuation -- guaranteed viewer right here!!!
he has, infact all he did this video was ask you to watch his other videos to actually understand
I am learning a lot from you without attending a business or financial school. Please keep it up. I need some tutorial about IPO
Just discovered your channel. I needed this. Just started a finance class and this is exactly what I needed
Assets-liabilities + goodwill
hard part is figuring out goodwill ;p
racingcarsmedia goodwill is an asset
@@glof2553 LOL smartie that's basic... there's a reason why goodwill is purposely calculated on its own- because goodwill comprise of so many factors, and are estimates at best...
Daniel Ong I understand that, ding dong. Maybe clarify that assets in OP’s equation does not actually include goodwill.
@@danielong1153 Daniel Craig.
This is the 4th and 5th way:
Maximum Postulated PE Multiple PEmp
1. NetROIC Methodology :
PEmp/NetROIC = 1 ÷ (1 + WACC_r) ÷ (1 + Inflation_r) (new)
2. Growth Methodology (CAGR over 10 years) :
PEmp/NetCAGR = 1 ÷ (1 + Inflation_r) (modified PEG)
where
2.1 NetCAGR
= Net Income Growth_CAGR ÷ (1 + Invested Capital Growth_CAGR_r)
or
2.2 NetCAGR
= Net Income Growth_CAGR ÷ (1 + Total Equity Growth_CAGR_r)
Brilliant videos. I now understand concepts and principles far, far better even though I studied this for years. Fantastic teacher.
too stylish about gestures.. cant even hear well enough... :(
Thank you, that was a good starting point.
I totally disagree with the second option. I mean then you could value a company at your competitions sales... Absurd really.
Hi I feel if any one seeing your vedios would be simple guy like me I would have appreciated if it was explained with example of any random company
I couldn't get past the first minute. Your arm movements are so distracting, I can't even watch the video.
That's it from me for now but do keep in touch on Twitter @TimEditor Thanks for watching! Tim.
I love your presentation style! So nice and calm and quiet, and very clear information. Thank you!
5:54 yup Sir... Quick & dirty ...but thank you for the new trick.. thank you... Please include more quick & dirty tricks in your videos, may a small section or a how video dedicated to it.. please..
Valuation 101! The big test comes in identifying which company should fit which model based on your assumptions!
Thank you for another good video. Would like to know some more approaches.
Beside the content of your videos, your style of teaching and body language is amazing.
This is one of the best videos on investment and finance that i have seen in my life.
My finance professor simply referred me to this video instead of teaching the content lol
Would it be typical to value the company by its Net assets and/or Equity?
You are a good teacher.
Is it legal for the buyer to sell the equipment to pay for the business and the seller had them sign a letter that they would take care of the employees and then the three buyers give them selves a million dollar bonus the second year and the other employed starved and most of them were let go so unfair to the ones that did the right thing
there are some people that buy companies simply to liquidate them. not illegal unless negotiated into the contract of sale. you can promise all you want but unless there is "accountability" such as a signed promise in a contract its not illegal to sell assets of a newly bought company. Starved employees? is this in a 3rd world country by any chance? no employee in theory should be starving if they are paid but without a lot more details I couldn't possibly comment on this part of your comment. Sad story but from what you have said so far, not illegal at all
brilliant sir. clear concise explanation of these basics. thank you!
Thanks, helpful info!
excellent videos, accelerating my financial literacy. thank you for the content
Thanks very much.
thanks for your hardwork
HI,, Is Tim still making videos ?
It's amazing how you can explain it so well sir.
Great content. Most business owners could sell their business based on these approaches. There are strategies which will allow an owner to sell their business quickly by creating a competitive environment forcing buyers to compete against each other and driving up the sale price for your business. Valuing the business is a starting point in order to understand the timing of the sale.
Great vids! Helped me through MBA
yaaaaa sooooo this video is a little too clear and to the point. If you could go off on more tangents and do some more self promotion that would be great. thanks, Have you seen my stapler?
Nice video, very easy to understand.
Also you should have broke out the private and public holdings....most people watching this are looking at private holdings so to even suggest public holdings just throws a wrench in the lesson imo. To be fair, if you are taking over a publicly traded company and are looking to youtube to get advice.....good luck.
Can you do a more thorough video about the DCF valuation method? getting into the how you determine the terminal value, the interest rate / WACC. thanks !
I would be interested in seeing more videos on these valuation techniques, maybe a series on each one.
Thank you. This is very informative.
Like it 'quick and dirty'!
I just look at the companies trading volume compared to similar companies around the same market cap. Follow the money Simple
A lot of time the money is wrong. 2001, 2008
If I want to improve the company value is high, I will setup optimal capital Structure and I think I will setup the ratio between the short-term asset and long-term asset > 1. How do you think?. Thank you.
All the videos you mention in this video as "you should check this out" videos....they should be in this play list. That's rather elementary, no? Friendly heads up :D You appear to be bright and this minor under-sight leads one to think otherwise. I know the ups and downs of running a channel, just looking out.
Is this taught in mbas?
It’s very difficult to understand you because your voice trails out a lot. I suggest getting a better mic that can pic up low tones well and/or taking some vocal/speech lessons to learn to evenly project your voice.
Idk what is this,
Hi Tim , I have started watching your videos. They fabulous, thank you
Well this is quite helpful video before starting any negotiation
Your explanations are great, but I just have a hard time finding the relevant videos for each topic. It would be great if you include the links of the relevant videos in the description.
A house is an asset?
The intro is too long better come to the point quickly..
Carsten Hdt. You want free advise and don't want to waste your time. Go pay for it with a professional advisor and stop winging about it
Well explained
I miss this guy 😢
Good work. Plus, the assets of the company (including its business name value in its market segment) less borrowings. And, the number of shares on issue also, are some other important fundamentals in valuing share prices & companies.
Fantastic lecture!
I am a disciple of the 'big picture' approach to teaching.
The video title as well as the introduction did just that to pique my interest in this video.
Now, I want to watch more videos made by you.
Thank you for sharing.
Cheers!!!
play at 1.25x
Old but gold.
This is the 4th way:
Combining P/B ∝ ROE and P/E ∝ NetROIC into a single formula
Plotted empirical graphs showing convincing proportional correlation of the followings:
P/B ∝ ROE
and
P/E ∝ NetROIC
Derivation to find a consolidated single formula:
P/B ∝ ROE
P = k*B*ROE -- (1)
P/E ∝ NetROIC
∴ P = v*E*NetROIC
k*B*ROE = v*E*NetROIC
k=v*E*NetROIC/(B*ROE) ---(2)
Substitute (2) to (1)
P
= k*B*ROE
= v*E*NetROIC/(B*ROE) * B*ROE
= v*E*NetROIC
∴
P/E = v*NetROIC ----(3)
v is a variable that explains why sometimes the plotted P/E are hovering above or bottom along the NetROIC line.
My logical thought give me a hypothesis to include to following factors:
1. Wacc has diminishing effect on profitability.
2. Inflation rate has direct negative impact on earnings.
∴
V
= 1/(1+WACC_r) * 1/(1+Inflation rate_r)
∴
From (3),
P/E
= v*NetROIC
= NetROIC÷(1+Wacc_r)÷(1+Inflation rate_r)
Where:
NetROIC
= Adjusted recurring Net Income / Adjusted Invested Capital
Adjusted Invested Capital
= Outstanding Invested Capital - Outstanding Excess Cash and Cash Equivalent
Outstanding Excess Cash and Cash Equivalent
= Cash and Cash Equivalent - Total Liabilities - Total Shares Capital
The Outstanding Excess Cash and Cash Equivalent must be a positive value; if it is a negative value, then reset it to zero.
Outstanding Invested Capital
= Outstanding Total Equity
+ Outstanding Total Non Current Liabilities
+ Outstanding Current Interest Bearing Liabilities
+ Outstanding Interest Bearing Current Leases
+ Current Contract Liabilities - Current Contract Assets
+ Current Deferred Tax Liabilities - Current Deferred Tax Assets
+ Current Other Payables and Accruals
Get to the point
Excellent!
Good content
Starts 3:16
Even more confused. Now we have to find the other vids to link to this vid to get the answer to part of this vid. Now we need a dictionary for all the words In all the vids.
thank you
Brilliant
Thank you Tim, I appreciate the way you teach us. Well done!
I evaluate how long into videos do people get to the point. And nobody start with numbers.
Terrific
Thank you
The video are short, precise and concise and very educative. Thank you.
nice example with the house price!!! It really made sense!!!
Hi Tim
I want to impose a trailing stop loss on my portfolio of shares.Do you know of any software that would alert me when a trailing stop loss is breached without me having to do calculations each morning?
Your voice deserves "ASMR" in your video titles.
what do you actually cover in this video? cuz all i'm hearing is click on this video click on that video
Best if you can use examples. Thank you though.
Hi Tim , are you able to cover valuation in more detail.
What accent is this
Received Pronunciation/ Standard English
What about the Dividend Discount Model? I could do with a video about that, please!
Awesome awesome video ! Always wanted to learn this ! Thanks !
i like your name "bennet " easy to pronuciate, and by the way loved your videos
Who go to this video after listen to buffet advice?
love your passion and succinct explanation. learned a lot. thanks!
Excellent vids, keep them coming.