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I'm building a site that performs discounted cash flow analysis of stocks. Most of the existing work in this area comes from people selling custom spreadsheets.
by chromatic 14y ago
I'm building a site that performs discounted cash flow analysis of stocks. Most of the existing work in this area comes from people selling custom spreadsheets. I think there's a good chance to disrupt that market, especially by combining it with education and a notification component.
- kamaal 14y agoI understood everything apart from 'discounted cash flow analysis of stocks' Can you please explain in plain English what that means?
- chromatic 14y agoYou calculate the intrinsic value of the company by projecting how much real cash it can produce over its useful lifespan. Then you calculate the current value of that future money (you have a target rate of return you want to meet or exceed). That gives you a fair price per share right now. It's a pretty standard Benjamin Graham valuation method.
- yashchandra 14y agoIn general, discounted cashflow means "if you will get $100 in 1 month i.e. future cashflow, what will be it be worth today i.e. discounted to today i.e. present value which should be little less than $100"