Tag

valuation

6 explainers · 12 quiz questions tagged “valuation”.

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Articles

Beginner · 35/100

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.

earnings multiples P/E ratio valuation
1 min read
Beginner · 40/100

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.

capex cash flow FCF free cash flow
2 min read
Intermediate · 45/100

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.

DCF EV/EBITDA margin of safety P/E ratio
2 min read
Intermediate · 48/100

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.

assets book value price to book valuation
2 min read
Intermediate · 55/100

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.

EBITDA enterprise value EV/EBIT EV/EBITDA
2 min read
Intermediate · 55/100

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.

DuPont leverage profitability return on capital
8 min read

Quiz questions