I think they are referring to the "net present value of future cash flows" model for valuing stocks. Its one model that can be used to help determine the value

I think they are referring to the "net present value of future cash flows" model for valuing stocks. Its one model that can be used to help determine the value of a company - the idea being that you aren't necessarily buying a company's stock for its earnings today, you are buying it for what it will earn over the time period you intend to hold it. Of course, that's not the only thing that determines stock price.