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The 7investing Podcast

How to Value a Stock (Investing 101 Vol. 1)

Apr 16, 2020
47:26

In volume 1 of our Investing 101 series, Lead Analysts Matt and Austin discuss some common terms and things they think about when valuing stocks. 

During this episode we discuss:

  1. Why we don’t value stocks by the price of the stock
  2. Why we don’t look for stocks that are down a high percentage from their highs
  3. How to find and asses Price to Earnings (PE) Ratio (GAAP, Non-GAAP, Forward PE), When/Why you should use GAAP or Non-GAAP numbers
  4. Example of finding Walmart’s PE ratio
  5. Price to Sales Ratio (PS) definition and example finding Walmart’s PS ratio.
  6. Price to Book Ratio (PB)
  7. Discounted Cash Flow (DCF) and why Matt and I don’t use them much in our investing process.

Definitions and examples in this episode

  1. Market Cap
  2. Price to Earnings Ratio (PE) (GAAP, Non-GAAP, Forward PE), When/Why you should use GAAP or Non-GAAP numbers
  3. Price to Sales Ratio (PS)
  4. Price to Book Ratio (PB)
  5. Discounted Cash Flow (DCF)
  6. Gross Margin
  7. Operating Margin
  8. Dollar-Based Net Expansion Rate (DBNER)

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