How Investment Bankers Calculate Intrinsic Value!

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Investment bankers have the extremely important role of setting the initial stock price at a level that will hopefully attract investors to obtain the financing that the company needs. Determining the initial public offering stock prices can be a difficult business, as the investment bank has to handle a delicate balance in pegging a price that will provide maximum funding for their client company, while also attracting a maximum number of investors. If they Price the stock too high, it may fail to attract sufficient investors, but if they price the stock too low, it may fail to provide a sufficient amount of capital. So how do these investment bankers decide what stock price to offer these companies at? While there are a quite a few valuation methods in the finance world, the investment banking community has largely gravitated to what is known as the multiples valuation method also known as the comparables valuation method. In this video we are going to be discussing what the valuation method is, and how to perform one step by step.
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[@chrstdvd]

This is a really good one. I can use it to find companies in Sectors which I am not invested in.

[@brandonflorida1092]

How does this help me? I need to know the formula for intrinsic value, not that you own a spread sheet that does it.

[@TheCompoundingInvestor]

Interesting video. I try to follow the Buffett principle of buying companies with large economic moats with good balance sheets and I hold for the long term. Keep up the good work. Your spreadsheets are very clear.

[@liammerrick6399]

im a regular at any store named XXX

[@Dividendology]

lol!

[@KevinPerez-fd9xq]

😂 oh boy.

[@herr7979]

Hahaah

[@Hajico.]

Thanks for all the great videos!

[@Dividendology]

Glad you like them!

[@nathgoody5905]

Awesome!

[@rockystaatz521]

Actually it’s a guess because they have to because tomorrow there’s going to be a fire or outrage over something.

[@aaronderouen5873]

If the formulated stock price is HIGHER than the current stock price, does that mean the stock is under valued and a "buy"?

[@Dividendology]

With a 0% margin of safety, yes.