Equity Valuation Methods: Rapid Fire

What this video covers

• How to sort any valuation tool into fundamental analysis (financials, earnings, intrinsic value, long-term) or technical analysis (price, volume, short-term)
• Why price-to-earnings (P/E) and price-to-book (P/B) ratios are strictly fundamental tools despite having "price" in their names
• What a P/B below 1 signals about net asset value, and which industries it suits best
• How the Gordon Growth Model values a stock with constant-growth dividends, and why the model breaks mathematically when growth rate (g) equals or exceeds required return (r)
• Why discounted cash flow (DCF) works for non-dividend payers when the dividend discount model (DDM) cannot, and the inverse relationship between discount rate and intrinsic value
• How to adjust D0 to D1 before applying the Gordon formula, and why preferred stock must be subtracted before computing book value per common share
• Why terminal value dominates DCF valuation and remains highly sensitive to small changes in g or r