Re:Netflix is now worth more than $100B
by nicky0 on Tuesday January 23, 2018 @06:01AM
(#16212553)
Do stocks really trade based on DCF? That sounds like a fiction taught in schools. I thought in the real world they traded based on whatever the hell criteria the people trading them felt like.
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They definitely don't trade based on DCF, and just one look at the stock market confirms this. DCF is just one method to put a valuation on a company. There are plenty other ways. The parameters chosen allow enough freedom to basically come up with any valuation you want anyway, so there's definitely no one "correct valuation" even if restricted to DCF.