what I don't understand is when calculating retention rate, why only exclude dividends and not whole amount of profit that is not used to grow the net income (for example the amount that goes for stock buybacks)?
I just looked at a company that grew its revenue 50% and grew EBITDA & Net Income drastically without breaking a sweat (no debt on the BS and didn't raise equity). Does it point to a flaw in the SGR? (Cash conversion cycle, multi year deals with some cash prepayments etc)
Dear Friends, I have many questions about SGR (sustainable growth rate) of a company: 1/ Reasons and advantages when we apply SGR to analyze future performance? 2/ Is loan interest a factor to consider for SGR when it helps the company's value increase?. 3/ Does SGR participate directly or indirectly in any company valuation methods?
I guess it should be participating while determining a growth rate for a company's future cash flows, since it has HUGE impact when valuing the business. Sometimes I come across start-ups which have 60% growth rate, it is so absurd to think that the company can sustain that rate, like, every dollar you invest, will become 10,48 dollars after 5 years if company sustain that rate for 5 years.
Thank you. You covered almost everything in my finance class.
Do you intend to make more videos? These videos are amazing!
Thank you very much! very useful
Much simpler formula. Thanks 😊
Thank you so much sir for better understanding....#vishalpokar
what I don't understand is when calculating retention rate, why only exclude dividends and not whole amount of profit that is not used to grow the net income (for example the amount that goes for stock buybacks)?
This saved me lol. Thank you so much!
I just looked at a company that grew its revenue 50% and grew EBITDA & Net Income drastically without breaking a sweat (no debt on the BS and didn't raise equity). Does it point to a flaw in the SGR? (Cash conversion cycle, multi year deals with some cash prepayments etc)
Hello.
My name is erez and i really want to learn very well how to read financial reports.
there some website that you teach ??
Dear Friends, I have many questions about SGR (sustainable growth rate) of a company:
1/ Reasons and advantages when we apply SGR to analyze future performance?
2/ Is loan interest a factor to consider for SGR when it helps the company's value increase?.
3/ Does SGR participate directly or indirectly in any company valuation methods?
I guess it should be participating while determining a growth rate for a company's future cash flows, since it has HUGE impact when valuing the business. Sometimes I come across start-ups which have 60% growth rate, it is so absurd to think that the company can sustain that rate, like, every dollar you invest, will become 10,48 dollars after 5 years if company sustain that rate for 5 years.
is perpetual growth rate same as sustainable growth rate?
shouldn't it be ROIC instead of ROE?
No