Tag Archives: intrinsic value

EP26 Buffett’s Views on Derivatives, Intrinsic Value (cash flow, discount rate), Insurance Business



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This episode covers Buffett’s views on

  • Use of derivatives
  • Intrinsic value calculation in terms of cash flow and discount rate
  • Intrinsic value calculation for insurance business

Podcast Website: http://valueinvesting.blubrry.net/

1994 Berkshire Hathaway Annual Meeting: https://www.youtube.com/watch?v=fjXZbW8ALRA

 


EP16 (Part 2) Business Intrinsic Value Calculation



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Followed by EP15 that covered three main valuation approaches (ratio-based, asset-based, and acquisition-based), this episode covers a Discount Cash Flow (DCF) approach to derive an intrinsic value of a company.  In this episode, I discuss three important questions for the DCF approach and show you how you can estimate the intrinsic value by using a 2-stage DCF analysis.

  1. Estimate the first year normalized future cash flow after excluding unexpected items
  2. Determine the first stage growth rate depending on the characteristics of the business
  3. Calculate a terminal value by assuming that the company is mature
  4. Use an appropriate discount rate (either 30 yr Treasury bond rate or other approaches such as WACC)

Additionally, I cover how you can include conservatism as a value investor in three different places (cash flow projection, discount rate, and margin of safety).

DCF tool available on: https://www.gurufocus.com/

 


EP15 (Part 1) Business Intrinsic Value Calculation



Support this podcast through your donation: https://paypal.me/valueinvesting

This episode and next episode cover four valuation approaches to derive an intrinsic value of a company.

  1. Ratio-based approach (covered in this episode)
  2. Asset-based approach (covered in this episode)
  3. Acquisition approach (covered in this episode)
  4. Discounted Cash Flow approach (covered in the next episode)

Podcast Website: http://valueinvesting.blubrry.net/