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Value After Hours S06 E11: John Rotonti Jr on best value firm processes and valuing buybacks

The Acquirers Podcast

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Analyzing Free Cash Flow and Valuation Models for High-Growth Companies

The chapter explores the importance of free cash flow in evaluating earnings quality, emphasizing the predictive nature of price to free cash flow ratios over time. It discusses the challenges of modeling high-growth companies in valuation frameworks and the trade-offs between high-growth and value investing strategies. Examples from companies like Boeing and Intel are used to illustrate the risks of excessive buybacks and the complexities of financial engineering in fast-changing industries.

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