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Finance & Stock Market Mastery
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Module 3
Valuation: What a Business Is Worth
1
Time Value of Money: Discounting, Compounding, and Growth Assumptions
Apply discounting and compounding to quantify the time value of money and demonstrate how growth assumptions can make a stock look brilliant or worthless.
2
Calculating FCFF from Financial Statements
Calculate Free Cash Flow to the Firm (FCFF) from financial statements by adjusting for non-cash charges, working capital changes, and capex.
WACC: The Discount Rate's Impact on Valuation
Determine a practical discount rate for a valuation model using the Weighted Average Cost of Capital (WACC), and explain why this single input dramatically alters perceived value.
4
Building a Two-Stage DCF Model
Build a complete two-stage DCF model, incorporating cash flow forecasts, a terminal value calculation, and arriving at an intrinsic value per share.
Multiples-Based Valuation: A Reality Check
Use multiples-based valuation (P/E, EV/EBITDA, P/S, P/B) as a reality check against a DCF, and identify when each multiple is useful versus misleading.
Valuation Gaps: Opportunities or Value Traps?
Compare your intrinsic valuation against the market's relative pricing to identify when a valuation gap represents a real opportunity versus a value trap.
7
Implementing the Margin of Safety
Apply the 'Margin of Safety' principle by systematically creating a buffer between your estimate of intrinsic value and the current market price.
8
Sensitivity Analysis for Valuation Models
Conduct a sensitivity analysis on a valuation model to understand which assumptions are the most critical drivers of the final value.
Previous module
Accounting: The Language of Business
Next module
Macroeconomics for Market Operators