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This. The value of a stock should (in theory) be based on discounted cashflow with the emphasis on cash. A company can generate massive earnings but if it needs
by klelatti 3y ago
This. The value of a stock should (in theory) be based on discounted cashflow with the emphasis on cash. A company can generate massive earnings but if it needs to invest huge amounts of capital to support those earnings then it should have a lower valuation.