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flowergirl Group Title

hi guys, can i please have some help with working out P/E ratios? xx

  • 3 years ago
  • 3 years ago

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  1. business1 Group Title
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    P (Price per Share) / E (Earnings per Share)

    • 3 years ago
  2. flowergirl Group Title
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    thanks :). is it possible to work out an intrinsic value from the p/e ratio? x

    • 3 years ago
  3. business1 Group Title
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    intrinsic value is calculated by discounting firm future cashflows at weighted average cost of capital.

    • 3 years ago
  4. flowergirl Group Title
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    yeah, i kinda understand...i've done some of that all ready with discounted cash flow valuation. But now i'm trying to find an intrinsic value from relative valuation ratios? sorry its all a bit confusing :S

    • 3 years ago
  5. business1 Group Title
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    intrinsic value is not same as relative value

    • 3 years ago
  6. flowergirl Group Title
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    for a high growth company do you forecast the change in working capital and net capex at the same rate as operating income grows? :)

    • 3 years ago
  7. flowergirl Group Title
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    growth*

    • 3 years ago
  8. business1 Group Title
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    change in working capital better tied to revenues rather than income as income more volatile. necessary capex to be assigned according to what investments are required to achieve revenues you forecast when company reaches stable growth. calculations in attached doc written by damodaran.

    • 3 years ago
  9. flowergirl Group Title
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    hmmm it just seems so hard to keep growth constant with ROC and reinvestment rate like which one do I determin first?? should reinevesment rate be capex and working capital as a % of operating income?? because that value coupled with my very high growth rate give me an ROC close to 100%!!! sorry if that was a bit much, im really struggling :) :)

    • 3 years ago
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