Unified Discounted Metric Formula
Unified Discounted Metric Formula
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The Intrinsic Value Formula is of Discounted Metric Model.
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Metric
= Either EPS or FcfPS
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Runway (Years)
= 10 Years coupled without or with Gnet_profit
= ROIC, √(ROIC×ROA) & ROA coupled without or with Growth →Gcicc
= Perpetual 99,999 without Growth
.
Gnet_profit_Factor
= 1 + Net Profit Growth Ratio
.
Without Growth
means
Growth_Factor
= 1 + Growth Ratio
= 1 + 0
= 1
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Gcicc_Factor
= 1 + CICC Ratio
= CICC Factor
.
Discount Factor
= CICC_Factor
.
:: :: ::
Unified Discounted Metric Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
:: :: ::
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Examples :
.
(1)
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Perpetual Discounted EPS Without Growth Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × (1÷CICC_Factor) × [ 1 - (1÷CICC_Factor)^99,999 ] ÷ [ 1 - 1÷CICC_Factor ]
= EPS ÷ CICC_Factor × [ 1 - (1÷CICC_Factor)^99,999 ] ÷ [ 1 - 1÷CICC_Factor ]
= EPS ÷ CICC_Ratio
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(2)
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Discounted EPS of 10 Years with Gnet_profit Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × Gnet_profit_Factor÷CICC_Factor × [ 1 - (Gnet_profit_Factor÷CICC_Factor)^10 ] ÷ [ 1 - Gnet_profit_Factor÷CICC_Factor ]
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(3)
Discounted EPS of 10 Years with Growth →Gcicc Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × →Gcicc_Factor÷CICC_Factor × [ 1 - (→Gcicc_Factor÷CICC_Factor)^10 ] ÷ [ 1 - →Gcicc_Factor÷CICC_Factor ]
= EPS × →CICC_Factor÷CICC_Factor × [ 1 - (→CICC_Factor÷CICC_Factor)^10 ] ÷ [ 1 - →CICC_Factor÷CICC_Factor ]
= EPS × 10
In other means, if Net Profit Growth is > CICC, then, P/E < 10 is deemed undervalued in this Model.
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(4)
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Discounted EPS of 10 Years without Growth Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × 1÷CICC_Factor × [ 1 - (1÷CICC_Factor)^10 ] ÷ [ 1 - 1÷CICC_Factor ]
.
(5)
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Discounted EPS of ROIC Years With Growth→Gcicc Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × →Gcicc_Factor÷CICC_Factor × [ 1 - (→Gcicc_Factor÷CICC_Factor)^roic ] ÷ [ 1 - →Gcicc_Factor÷CICC_Factor ]
= EPS × →CICC_Factor÷CICC_Factor × [ 1 - (→CICC_Factor÷CICC_Factor)^roic ] ÷ [ 1 - →CICC_Factor÷CICC_Factor ]
= EPS × ROIC
In other means, if Net Profit Growth is > CICC, then, P/E < ROIC is deemed undervalued in this Model.
.
(6)
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Discounted EPS of ROIC Years Without Growth Model
= Metric × Growth_Factor÷Discount_Factor × [ 1 - (Growth_Factor÷Discount_Factor)^runway ] ÷ [ 1 - Growth_Factor÷Discount_Factor ]
= EPS × 1÷CICC_Factor × [ 1 - (1÷CICC_Factor)^roic ] ÷ [ 1 - 1÷CICC_Factor ]
= EPS ÷ CICC_Factor × [ 1 - (1÷CICC_Factor)^roic ] ÷ [ 1 - 1÷CICC_Factor ]