Warren Buffett: How to Calculate the Intrinsic Value of a Stock (A Step-by-step guide)

This video will cover my market beating value investing strategy step-by-step, this strategy has helped me outperformed the S&P 500 index in the past 6 years. Most individual stock investors are buying stocks only because the prices are going up, which usually lead to financial disaster. Stocks often trade at prices far from the business value of the underlying company, and finding the intrinsic value of a stock is the key to the investment success. After watching this video, you will be able to value a stock using the DCF model, suggested by legendary investor Warren Buffett.

PROOF OF PERFORMANCE
TFSA investment portfolio

RRSP & Taxable investment portfolio (Mobile only)

TFSA and RRSP are tax advantage investment accounts for Canadians.
TFSA = Tax free savings account, $7000 per year contribution limit as of 2024.
RRSP = Registered retirement savings account

FINANCIAL DATA SOURCE
Free 10-year historical stock data:

Stockunlock (The tool used in the video), costs $9/month:

DISCOUNTED CASH FLOW (DCF MODEL) CALCULATORS
Free Discounted Cash Flow Calculator:
Usage: The above google sheet is read only, you need to click on "File" tab and then click "Make a copy" to use it.

Stock unlock DCF calculator (recommended, require membership):

13F AND INSIDERS HOLDINGS

Warren Buffett Full Lecture:

Chapters:
00:00 - Finding intrinsic value of a stock is key to investment success
00:35 - My portfolio
00:52 - Part 1. Idea from Warren Buffett
02:25 - Part 2. Find company with predictable future cash flow
03:05 - 2-1-1. Economic moats
04:31 - 2-1-2. Discover Economic moats
05:16 - 2-2. Consistent Revenue Growth
06:00 - 2-3. Earnings Per Share (EPS) Growth
06:34 - 2-4. High ROIC
07:02 - 2-5. Leverage
08:38 - Part 2 Summary (Important)
08:45 - Part 3. How to calculate the intrinsic value
09:22 - 3-1. Find Rate of Dilution
09:39 - 3-2. Find Future free cashflow (FCF) growth rate
10:39 - 3-3. Find Future Price to Free cash flow Ratio (P/FCF)
11:02 - 3-4. Find Discount Rate
11:25 - 3-5. Find Trailing 12 months (TTM) Free Cash Flow, Shares outstanding
11:59 - Part 3 Summary (Important)

Thanks for watching! Make sure to subscribe if you like the content and make sure to comment down below if you have any suggestions.

DISCLAIMER: Solofire is not a financial advisor and nothing in this video should be considered financial advice. All strategy mentioned in the video has been practiced and tested personally by the creator to his best knowledge, however the future result maybe different from the past. Make sure to do your own research before proceeding.

[NamekianScholar]

Powerful video!!!! 08:39 needs to be memorized

[solofireca]

Which stock do you think is most undervalued right now? Make sure to comment down below!