valuation
6 explainers tagged “valuation”.
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The P/E Ratio: What It Really Tells You
The price-to-earnings ratio is the most quoted and most misused number in investing. Learn what P/E measures, trailing vs. forward, why a low P/E isn't automatically cheap, and how to compare it fairly.
Free Cash Flow: The Cash a Business Actually Keeps
Profit is an opinion; cash is a fact. Learn what free cash flow (FCF) is, how it differs from accounting profit, the P/FCF and FCF-margin checks, and why many investors trust cash flow more than earnings.
How to Value a Stock: Multiples, DCF and Margin of Safety
Is a stock cheap or expensive? Learn the main valuation tools — P/E, P/S, P/B and EV/EBITDA multiples, discounted cash flow, and the margin-of-safety mindset — and how to use them together.
Price-to-Book and Asset Value
The price-to-book ratio compares a company's market price to the value of its net assets. Learn what book value is, when P/B is useful, and where it badly misleads.
Enterprise Value and EV Multiples: Valuing the Whole Business
Market cap prices the shares; enterprise value prices the whole business, debt included. Learn what EV is, how EV/EBITDA, EV/EBIT and EV/Sales work, and why they beat the P/E ratio for comparing companies with different debt.
ROIC vs ROE vs ROI: The Complete Guide to the Three Return Metrics
ROI, ROE and ROIC all measure return on money, but each uses a different definition of “money in”. This guide explains the difference with worked examples — in beginner, intermediate and advanced versions — and shows why ROIC, not ROE, is the metric most tied to long-term value creation.
