They are using 16 times PEG into EPS. Itâs a different formula than mine. My question is whether intrinsic value calculated using different formulas can vary so much?
Thinking a little more about it, screener.inâs formula for calculating Intrinsic Value seems to be utter nonsense.
They are using 16 times PEG into EPS.
PEG ratio for undervalued companies is low.
PEG ratio for overvalued companies is high.
So multiplying it by 16EPS for undervalued companies would give you a low intrinsic value for undervalued companies. And a high intrinsic value for overvalued companies. Which makes no sense whatsoever.
where i can get the relative strength rankings and line for technical stock analysis.
i have been using zerodha kite for charts but unable to find that data.
i have also tried investing.com and money control with no success.
can you please share the source.
I was going through dr Lalpath labs AR.
They have mentioned deposits with body corporates as 65 crores and interest esrnjng from the same as 1.7 corre.
What does the mean of body corporates?
How much percentage of interest we can expect from the same?
So, the âIntrinsic Valueâ formula in Screener is just 16 x PEG x EPS, which looks like some convoluted way of doing a simple P/E Multiple valuation. I donât think I have to comment on its accuracy.
I am trying to make a simple stock price forecasting formula. Highly generalized. But can give approx estimateâŚNeed your help to improve. Kindly share constructive guidance !!!
Assumptions & Logic
1.Time after 5 years
2.PE after 5 years will revert to mean (Avg last 10 years), If current PE is higher than mean.
3.If current PE is lower than mean then future PE will be current PE. This makes future PE conservative
4.Future EPS= EPS will grow @ CAGR of last 3 years profit growth compounded 4 times.
5.However if profit growth 3 years is more than 30% then moderate the forecast by 1/2. So a 40 % grower will grow by 20% in future
6.Future EPS*Future PE = Future price after 5 years
Sample Excel AttachedâŚyou can check the formula in line with assumptions
@dineshssairam@Yogesh_s@phreakv6
Kindly have a look at the EPS forecasting model and help me with feedback. Given your experience and analytical skills, I am sure I can create a better framework with MoS built in. Thanks!
PEG ratio for undervalued companies is low.
PEG ratio for overvalued companies is high.
So multiplying it by 16EPS for undervalued companies would give you a low intrinsic value for undervalued companies. And a high intrinsic value for overvalued companies. Which makes no sense whatsoever.
If Iâm not wrong, this is essentially how a Multiples Valuation is done, at least some shade of it. I built a similar tool myself: Practical Thought Valuation Model.xlsx (14.8 KB)
In the end, I feel, a Multiples Valuation is too simplistic. I myself use the tool Iâve built to keep tabs on the Cost of Capital for my investments, but I donât use it to actually value companies.
I think a Multiples Valuation is fine if your other research/reasons for investing in the company is as good as, say Charlie Mungerâs or Prof. Bakshiâs. In absence of this, I find Valuing a company by multiplying two numbers criminal.
So to conclude, yes, your tool works as a great rule of thumb. But thatâs exactly what you have to remember as well⌠itâs just a rule of thumb.
Cash and Borrowings come in the Financial Section of Cash Flow Statement, not in Working Capital changes. Note that still you may not get exact match as each item in Balance Sheet could have various sub components some of which may be treated differently while generating CFS.
Is having some portion of portfolio in gold a good option?
Gold is generally considered as hedge against inflation. So its advisable to have some allocation in it (not in jewelry form) , may be approx 5% or more if you are risk averse,
Has anyone attended Dr. Vijay Malikâs âpeaceful investingâ workshop ?
i am from Mumbai, from a non finance background.
they are having their next workshop in Hyderabad⌠i am planning to attend this one.
is it worth the time & effort (to & fro from Hyderabad) or should i wait for the workshop in mumbai ?
is the content really helpful and possible to be absorbed in 1 day or is it too much in too little time, especially considering i have no formal academic financial qualification.
