RE:The truth is...jdsd0517 wrote: It wasn't well received, so I do chuckle when I see boosters using the same methodology to justify a double digit stock price.
Updating assumptions (updated numbers highlighted):
- opening operating CF of $100million (which everyone claims)
- operating CF growth of 50% per year for 10 years (organic and inorganic)
- operating CF growth of 10% per year thereafter in perpetuity
- annual equity increase of 10% per year
- a required nominal rate of return of 30% per year (given higher base rate of inflation)
Based on that, this thing is worth $10 per share...not enough upside to make a bet without better info.
If it's worth $10 per share at a 30% rate of return, then it's a gift at current prices.
I don't want to get too much into the "inflation" talk, but I think that long term inflation will still be low (around 2%), as predicted by the long term bond value on the market. I also think that's the current market assumption... Which would make WELL an even better deal now.