Valuation Methodologies and the Importance of Financial Health

This chapter discusses the different valuation methodologies used by investors and emphasizes the importance of considering a company's financial health. It examines valuation approaches such as P.E. ratio, price to sales, and free cash flow yield, and compares the popular dividend ETF SCHD to the S&P 500. The speaker addresses the criticism of their investment strategy and explains the significance of returns on invested capital in evaluating a company's value.