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Advanced valuation and methods

Plain-English guides with worked examples: how to read financial statements, value a business, use technical indicators and manage risk. See the complete Financial knowledge series →

All 154Market basics 15Trading and market structure 16Reading financial statements 15Ratios and business quality 15Valuation 15Advanced valuation and methods 15Technical analysis 15Portfolio, risk and behaviour 15Economy, sectors and the calendar 22Commodities 2Forex 5Hedge funds 3Rates and macro 1
Advanced valuation and methods5 min read Reverse DCF: what growth is the price already assuming? A reverse DCF starts from today's stock price and solves for the growth it implies, so you can judge whether the market's expectations look... Read the article → Advanced valuation and methods4 min read Earnings power value: what a business is worth with no growth Earnings power value capitalizes normalized after-tax operating profit at the cost of capital, giving a no-growth value that often serves as... Read the article → Advanced valuation and methods4 min read Relative valuation with peer multiples Relative valuation compares a stock's multiples with those of similar companies. Learn how to pick peers and multiples, and where the method... Read the article → Advanced valuation and methods4 min read Regression-based multiples: what growth, ROIC and margin justify A regression-based multiple estimates the valuation ratio that a company's growth, returns on capital and margins justify, instead of just c... Read the article → Advanced valuation and methods5 min read Why fair value is a range, not a point Any fair value estimate carries large error. Learn why valuation models disagree, how a margin of safety handles it, and how StocksXray labe... Read the article → Advanced valuation and methods4 min read How the StocksXray X-Ray Score works The X-Ray Score condenses valuation, growth, profitability, financial health and dividends into one 0-100 number. See the weights, the math... Read the article → Advanced valuation and methods4 min read The five lenses: valuation, growth, profitability, financial health, dividends A stock can be cheap, growing, profitable, safe or generous with dividends, and rarely all at once. Learn what each of the five X-Ray lenses... Read the article → Advanced valuation and methods4 min read Beneish M-Score and spotting earnings manipulation The Beneish M-Score combines eight accounting ratios to estimate how likely a company is to have manipulated its earnings. Learn the formula... Read the article →
Advanced valuation and methods5 min read Cyclical stocks and normalized earnings Cyclical companies look cheapest at peak profits and priciest at the bottom. Learn why the P/E misleads and how normalizing earnings gives a... Read the article → Advanced valuation and methods5 min read Growth vs value investing Growth investors pay up for fast expansion, value investors look for low prices relative to fundamentals. Compare the two styles and see why... Read the article → Advanced valuation and methods5 min read Quality investing: buying high-return businesses Quality investing favors companies with high returns on capital, stable profits and strong balance sheets. Learn what quality means, how to... Read the article → Advanced valuation and methods5 min read Dividend growth investing: strategy, strengths and traps Dividend growth investing targets companies that raise payouts year after year. Learn how the strategy works, the math of growing income and... Read the article → Advanced valuation and methods5 min read The Rule of 40 and software metrics: ARR, churn, net retention Software companies are judged on recurring revenue, retention and the Rule of 40. Learn how ARR, churn and net revenue retention work and wh... Read the article → Advanced valuation and methods5 min read How to read a 10-K annual report The 10-K is the most complete public document a US-listed company files each year. Learn its structure, which sections to read first and wha... Read the article → Advanced valuation and methods5 min read 10-Q, 8-K and proxy statements: the other SEC filings Beyond the annual 10-K, the 10-Q, 8-K and proxy statement keep investors current on results, events and governance. Learn what each contains... Read the article →

Educational only, not financial advice.