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Strategies & Market Trends : Gorilla and King Portfolio candidates - Moderated -- Ignore unavailable to you. Want to Upgrade?

To: Jim Mullens who wrote (948)6/14/2004 6:20:19 PM
From: Mike Buckley  Respond to of 2955
 
Jim,

Wonder if the DCF method ever works /worked for projected high growth companies such as MSFT, INTC, CSCO?

The method always works if you input the correct data with regard to future cash flows, terminal value, and discount rate. By that, I mean that if we put the correct data in we get the correct intrinsic value. Regardless, those are big IFs.



To: Jim Mullens who wrote (948)6/14/2004 6:24:33 PM
From: Mike Buckley  Read Replies (1) | Respond to of 2955
 
Jim,

The discounted FCF methodology in the $60 per my recollection.

There is no such thing as "the" methodology determiniing the intrinsic value. Like all valuation metrics, it requires making assumptions about the future. Wrong assumptions beget wrong intrinsic value.

--Mike Buckley


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