You need only a few charts to decide

Graphs can be very powerful, so much so that it can describe the entire story behind one’s investing decisions.

In my excel based valuation tool, I have a lot of pre-built graphs and many a times, just by looking at the graphs, I decide not to proceed further (not the other way round though :slight_smile: )

Here are some of the graphs that I have in my excel tool (this is for Advani Hotels and Resorts):

  1. Business performance

  1. Cash flow situation

  1. Cash flow ratios

  1. EBIAT, Invested Capital and EVA

  1. ROIIC - 3 and 5 years CAGR performance

  1. SSGR vs sales growth

  1. EVA factors

  1. EVA per share

  1. EVA margin

  1. EVA momentum

  1. EVA momentum - du-pont analysis

In summary, we can derive following info from these graphs:

  1. Sales growth on rise after the COVID impact
  2. OPM and PAT on rise
  3. Debt nearly zero
  4. CFO, FCFF, FCFE and FCFE yield on the rise. Capex also increased which may mean higher sales in future.
  5. Almost all Cash flow ratios are +ve and on the rise.
  6. Invested capital falling down which can be a sign of worry. Company is not able to find avenues to put more capital in which can affect its growth in future.
  7. ROIIC in not in great shape which is a cause of worry
  8. SSGR higher than sales growth which is a good sign.
  9. EVA growth and EBIAT growth on the rise after COVID. ROIC greater than WACC which means company is creating value for shareholders.
  10. EVA margin, EVA per share, EVA momentum all +ve and on the rise which means whatever company is doing, adding a lot of value to shareholders.

After looking at these graphs, I am fairly convinced that it can be a good medium- term opportunity to invest in. Once I am convinced by looking at the graphs, I then use other detailed techniques to evaluate whether the current price is high or cheaper compared to its intrinsic value.

Disc: Not invested; still contemplating. Please do your own research before investing.

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good one ! wonderful graphical presentation .thanks .

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Could you share the excel file

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What does EVA stand for?

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Can you add this on google sheets ?

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Hi, thanks for showing interest. This excel is still work in progress. I will share it once I complete all other workings.

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Economic Value Added or Economic Profit Added. The concept is pretty old but modernized by Stern Value Management in recent times. It basically measures whether the company is adding value for shareholders or destroying it.

Currently, its WIP. I will share it here in few weeks time once I complete this.

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If company’s ROIC is higher than cost of capital which is cost of raising capital basically then it means company is adding economic value which is a favourable aspect

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could you please share the Excel