0
Declined

VALUATION METRICS

pmedina59 2 years ago • updated by Jae Jun 2 years ago 1

Hi Jae:


I'm sure you are getting tons of suggestions and ideas on how to FURTHER improve your app. Make no mistake: your app is GREAT.
But, yes, I'd like to offer a suggestion: don't you think it would be valuable to add "Book Value" to your company valuations? You currently have EBIT, DCF and Graham. Adding book value would give an important element of comparison. Take a look at Apple, for example: your median fair value is $144 but the book value is way below at $24. Conversely, take a look at Bank of America: your fair value using EBIT, DCF and Graham is $12. But Book Value is $25!!
I know I can get to BV in your app by looking at the P/BV multiple. But it would be so much better if your fair value would take into account the BV, which is the "truth" in many ways.

For your consideration.

Pedro A. Medina
Declined

Hi Pedro
I understand what you mean about BV. The thing with BV nowadays is that it has lost a lot of value.

E.g. BV doesn't mean a lot for software or IT companies as it is asset light. Manufacturers may be overly heavy on the BV which can make it look undervalued when it isn't.

P/B if on the key stats already, but it wont be added to the valuation.

http://screencast.com/t/NGY7xVbpVo