Alphabet | Alpha Quadrant by The Fifth Person

Questions › Category: Investor Psychology › Alphabet

Casey Goh asked 9 months ago

What is intrinsic value for Alphabet ? Considering it pays dividends as well as grow stock, is it better investment than Amazon which does not pay dividend ?

1 Answers

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Victor Chng Staff answered 9 months ago

Hi Casey, Have you tried plotting the price-to-cash-flow chart for Alphabet? The intrinsic value is calculated by applying the 10-year average P/CF multiple to its cash flow per share. Ultimately, the better investment depends on both the business model and the company’s valuation. If both companies have strong business models, then valuation becomes the final determining factor.

Casey Goh replied 9 months ago

Thanks Victor. Will try my hand at this.