![]() We recommend reading through the annual report and investor presentation to the extent that you can come up with those 5-10 key drivers.įor Walmart, we came up with the following: In theory, you could spend days, weeks, or months on industry and company research, but that much effort is not necessary. You could also search for industry data from companies like IDC, Gartner, and Forrester, but it’s not necessary for a quick analysis of a mature company.Īnd if you are dealing with a rapidly changing company or a tech startup (e.g., Uber or Snap), it’s often more useful to get KPIs and financial stats from similar companies that were once growing quickly but have since matured. The company’s annual report and investor presentations are the best starting points. What do its historical trends look like, ideally going back 5-10 years?.How can you project its revenue beyond a simple percentage growth rate? What about its expenses?.What are the top 5-10 most important drivers for the company?.Company/Industry Researchīefore you jump into Excel and start entering numbers, you should do a bit of company and industry research to establish the following: ![]() You value the company in both these periods and then add the results to get its total value from today into “infinity” (AKA until the Present Value of its cash flows falls to near-0). Its Cash Flow will still change, but the valuation formula above works because it requires only the first year of Cash Flow in this period.
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