We recently attended a roundtable event provided by TD Waterhouse Discount Brokerage entitled “Stock Chatter” at their downtown Vancouver Investor Centre.
This educational session lasted an hour and a half and provided the audience with an overview of current stock market conditions and two different approaches to equity valuation. The presentation also covered two case studies that provided a better understanding of stocks and important variables to consider when choosing them. The session also included opportunities for the audience to ask questions.
Two different approaches to equity valuation that were covered were Discounted Cash Flow Techniques and Relative Valuation Techniques.
Discounted cash flow techniques covered the following topics:
- Present value of dividends
- Present value of operating free cash flow
- Present value of free cash flow to equity
The relative valuation techniques covered included:
- Price/Earnings ratio
- Price/Cash Flow ratio
- Price/Book Value ratio
- Price/Sales ratio
Questions about both topics were answered well by the presenter
Another important subject covered during the session was the return on equity (ROE), which is composed of profit margin, total asset turnover and financial leverage. ROE is a measure of a firms profitability and is often known as a way of measuring the performance for shareholders. [Note: to learn more in detail on measures of company profitability and financial statements, click here]
Overall, the session was very informative and well structured. The presenter encouraged the audience to ask questions and was able to successfully answer them. Despite the small audience, discussions were informative and beneficial. The presenter also provided the audience with various handouts including presentation slides, charts and a dividend-focused report.
We were informed that the TD Waterhouse discount brokerage roundtable events would take place at the Investor Centre in downtown Vancouver on the first Wednesday of the month(excluding January)