Valuation metrics offer investors a simple way to assess a company’s worth by looking at its sales, earnings and cash flow. These metrics compare the company’s value to the market’s assessment of the company to determine if an investment is attractive. Let’s take a look at the most commonly used valuations and explore why we believe free cash flow yield is the most valuable of them all.
Beneath this market strength lies the cornerstone of today’s confidence: an economy that continues to expand at or above trend, with no imminent signs of recession clouding the horizon.