TFI

Reply to @GrowthInvestor : Already revealed. See his reply below.

Dividend_NinjaStars

Quality content! Better than anyhow call up and down in stock prices okie ... !!!

theintelligentinvestor

These are the 4 companies in this case study.

I mentioned Graham used to make his case studies interesting. I admit I also trying to do something like that by selecting 4 companies with almost the same market cap. As can see, they ranges from $81m to $88m.

There are several reasons; one is to compare the market with our valuation. More importantly is to share how 4 companies with vast differences in their earnings and financials can be valued at so closed market capitalisation.

Some may be surprised by this. For the past 5 year earnings, D has 4x of B, paying twice the dividends and the equity is 8x! but yet the market cap is the same. It is as if the market is saying that having higher shareholder equity is a negative impact on its stock price. Similar with B & C comparison with C having twice the earnings and equity. But yet book value is useful in some instance as in the case of A being supported by its book value. Or maybe the book value has little influence on the intrinsic value or the stock price. Maybe the predominant factors are just earnings/FCF, growth and ROE.

From observation, most has valued B and C almost on par and with D higher. There is no right or wrong answer here. Thanks to all who shared and hope this exercise has bring some values to the folks here.

TUBInvesting

Reply to @theintelligentinvestor : Great exercise. I was right abt C&D. You made a point that I never thought abt, looking at market cap and using that as reference.

You PE commons that 10 is conservative, 12 is ok, 16 is for growth.

Made sense, but I tend to go lower. haha

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