Company Valuation — A Three-Method Integrated Skill for Public Company Valuation

Skill Overview

Company Valuation is a valuation skill for estimating the intrinsic value of publicly traded companies. It cross-validates three methods—DCF discounted cash flow, comparable-company relative valuation, and SOTP segment valuation—to produce an implied share price based on a blended fair value, along with its potential upside/downside relative to the current market price.

Use Cases

1. Determine whether a stock is overvalued or undervalued — Enter a ticker symbol (such as AAPL, NVDA, or TSLA), and the skill automatically retrieves financial data and runs the full valuation process, directly answering “Is the current price expensive, and how much upside remains?”
2. Build and understand a complete DCF model — Automatically completes a five-year free cash flow to the firm (FCFF) forecast, calculates the WACC discount rate, estimates terminal value, and bridges enterprise value to equity value. Every assumption—including growth rates, margins, and tax rates—is clearly documented and can be manually overridden.
3. Compare peers and value diversified companies — Uses median multiples from 4–6 comparable companies (forward P/E, EV/Revenue, and EV/EBITDA) for relative valuation. For diversified groups reporting two or more independent business segments, SOTP can value each segment separately using pure-play peer multiples and then add them together.

Core Features

1. Triangulation across three methods — DCF (intrinsic value) + relative valuation (market benchmarking) + SOTP (sum-of-the-parts, where applicable). The results are weighted according to preset weights to derive a blended implied share price, while identifying the most optimistic and pessimistic methods to avoid being misled by the assumptions of a single model.
2. Sensitivity matrix and three-scenario analysis — Outputs a 5×5 sensitivity table using WACC (±1%, in 0.5% increments) and terminal growth rates (1.5%–3.5%), as well as implied share prices under Bull/Base/Bear scenarios (growth ±300 bps, margins ±200 bps, and WACC ∓100 bps), making the sensitivity of the conclusion to key assumptions immediately clear.
3. Automatic data retrieval and structured valuation reports — Uses yfinance to obtain real-time share prices, historical financial statements, analyst consensus estimates, and peer multiples. It automatically derives growth trajectories, three-year median margins, effective tax rates, Beta, and other parameters, ultimately producing a complete report containing a valuation snapshot, DCF details, peer comparison table, and key risk warnings.

Frequently Asked Questions

Where does the data come from? How reliable are the results?

Data is retrieved through yfinance from public-market interfaces, including historical financial statements, analyst consensus estimates, real-time share prices, and industry peer multiples. The risk-free rate is preferably sourced from the real-time 10-year U.S. Treasury yield; if unavailable, a default value is used and clearly identified. Financial ratios generally use the median of the past three years to smooth cyclical fluctuations. Note that yfinance data may not follow official reporting standards, and TTM data may be delayed. For major decisions, cross-check the results against primary documents such as the company’s 10-K and annual reports.

Are all companies suitable for these three methods?

No. The skill automatically selects the appropriate combination of methods based on the type of company: mature companies with stable cash flows are primarily valued using DCF; high-growth software/SaaS companies are primarily valued using relative valuation (EV/Revenue + Rule of 40); and diversified groups are suitable for SOTP. DCF is not appropriate for banks and insurance companies, which instead use multiples such as P/B and P/TBV, with this limitation clearly identified. REITs use P/FFO and P/AFFO. When data is insufficient or segment information is unavailable, the skill skips the relevant method and lowers the confidence level rather than forcing a result.

Does the valuation result constitute investment advice?

No. The output is for research and educational purposes only and does not constitute investment advice. DCF valuations are highly sensitive to input assumptions—garbage in, garbage out—and comparable-company multiples can be distorted by market sentiment. Accordingly, use the sensitivity ranges and scenario distributions as decision-making references rather than treating any single implied share price as a precise answer.