Fair value here, being the present value of future cash flows, is almost certainly multiples of the current price, from where I sit at least. Of course it is impossible to put an exact number on that and our models will vary quite a lot given the nature of the situation.
Dividends actually have very little to no impact on fair value, as they are a result of what management determines to do with free cash flow rather than actually impacting free cash flow. At the moment, opportunity abounds to reinvest all free cash flow in growth and we should not even be contemplating a dividend. The larger consideration aside from whether to pay out dividends, buy back stock, or hold cash in the bank, is at what rate this capital can be reinvested and for how long will this favorable environment persist? This is ultimately what drives the bulk of intrinsic value in a rapidly growing company, cash flows ten plus years out.
All I'm saying is that we have to think well beyond trailing numbers and basically ignore current dividend yields if that actually happens, because their impact on business value is minimal.
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