A short YouTube talk by Ndubuisi 'Andy' Egwim explaining practical steps for valuing businesses and his stock-picking approach: estimate free cash flow, expenses/liabilities, shareholder projections to derive fair value, use margin of safety, and buy during market crashes when others are irrationally fearful. He emphasizes learning stock analysis as a valuable lifelong investment.
So part of what we Learned in our 4 weeks investment master class was how to look at a business. I brought it down to actual practical things. Let's assume you have a hospital. What's your free cash flow? What are your expenses? Why, what we call liabilities. How many shareholders do you have? Why, your projections. This is how you value a business. Before you say, this is what I think is a fair value for this company, and then that's how you can tell whether you are underpaying or. Or overpaying. And that some of you followed me for a while. You know that whenever there's a stock market crash, I get very busy. That's when I buy a lot of my investments. Because then you start seeing people becoming irrationally afraid. Like Facebook stock. I've made almost 200% on it for the period of time. People were worried, they had some issues. The market irrationally sold it. So if you can do the. The work and work out what could be the fair value, you're not going to be 100% right. The goal here is not to be precisely wrong. You rather be vaguely right than precisely wrong. That's why we also introduce what we call margin of safety. So if you think the stock is worth like $50, you want to be buying it at $20. And if you can't get that $20, you're not interested, you move on. You look at something else. That's why we often say look if you want to. If you're really, really keen on doing individual stock picking, take out some time and learn it. It's an investment. It's in your life. For someone like me, my knowledge of investing I've had and I keep learning is one of the best investments I have made in my life.
