Owner earnings is literally the money i could take out of the business if i didn't want to grow it, because obviously we're going to use so that. I don't understand how you would ever not check this. If your criteria is, if i was the sole owner, i could do whatever wanted with this company's income. Ye? Well, that's it. I ca do whatever i want. So at point you're getting at something different, that you know what i'm getting at. The problem that was created by not using operating cash flow. Tell me more about that.
You’ve done the initial Four Ms analysis of companies on your watchlist, but your work is not complete. The next step in the researching process is critical, and tells you whether or not the business is worth purchasing. Being at this point in your analysis means that you’re highly confident that the company is going to be larger and more productive in ten years. Today, Phil and Danielle discuss this next step in the research process, and cover how to calculate margin of safety using the ten cap valuation process.
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