Subject: Valuation
First, happy Thanksgiving. Since this is a Berk. Board, I am sure a lot of you are good at valuation. There are three methods I can think of. The first is using multiples. p/s, p/b, p/e, etc. That seems too simple. Another is dcf. That strikes me as not perfect. How do you estimate terminal value, how do you pick the right discount rate, how do you accurately predict cash flow, 10 years into the future? There is 3rd way in between the two, that seems better. There are various variations of it, but it is basically, looking at the past, and listening to earnings calls, to get the future earnings, revenue or cash flow. Predicting a reasonable p/e for the future. Using your logic to figure out if there will be share dilution. Bu doing that, you can predict a future price. From that, it is simple math to pick what price it has to be at to get what return.

I wonder if other people use this method, if there are websites that teach it, or books that teach it. It seems the best method to me.

Thanks in advance.