Investing Basics - Feel free to ask the most basic questions

[MHS]

@sham72942

1.) What are the resources to check for current valuation, or have to do our own individual DCF analysis?
2.) Why would I be willing to pay higher P/E multiple?

Numbers and Narratives: A Simple Discounted Cash Flow (DCF) Model for Equity Valuation

I have created a Discounted Cash Flow Excel Model for Valuation of Common Stock. A Stock’s value is nothing but the story behind the stock and the numbers that keep the story grounded in reality. Hence, I have named the model ‘Numbers and Narratives’. The name is also inspired by one of my all-time favorite YouTube videos by Prof. Aswath Damodaran. In fact, the model itself is a spin-off of a larger, more complex Valuation model created by the Professor himself. Do visit his website to access m…

2. One simple calculation:
   For example companies A and B, growing at 15% & 40% CAGR its earnings and having valuation @15PE & 40PE, respectively.
   Say both are at 100 today in valuation.

At the end of say, 5 years, Company A is still at 15PE and say company B is at half of its 5 years back valuation, 20 PE.

Now calculate and see the value of both companies end of 5years. Then you will be surprised and understand 5 years back which is cheap, in hindsight. Probably u will get the answer to your question.

Off course MOAT/SECTOR/PROMOTERS/OPPERTUNITY SIZE and lot of things matter in valuations.