Short Term Trading Week Starting: 5th Sept, page-205

Good post @952i - appreciate the insight. Just a question but why does Economic Value reduce the market cap by cash, debt and 'other assets' which i assume is intangibles to get a EV? I thought if one was trying to get the EV of a company one would reduce things which are harder to liquidate or quantify i.e. intangibles, fixed assets (which may not realise book value etc) and if anything you would keept debt (as unless you default it has to be paid) and most importantly cash would form part of your EV? For example, looking into the RDG tip , I would note cash of 13m for 30 June 2016 indicates over 632m shares issued a $0.02 value. Therefore at $0.04 one is currently paying a net $0.02 for the value of the recurring operations which seemed to make 5m NPAT for the year or $9m net operating cash flow. So I would have thought when calculating value one would break down into pieces such as that?

Perhaps an example with RDG or ARM as to your EV analysis and thought process when assessing it back at the relevant prices they were tipped to assist some of us to better understand the rationale? For JCS for example how would you arrive at 4.6m (a rough explanation since I'm sure there is far more depth to your calculations/mechanics). Is there a formula per se to calculate fundamental value essentially if one knows cash and potential recurring profits/revenue etc?

One thing I struggle with is short of experience is there somewhere where one can consult a rough back of the envelope guide as to what sort of price to earnings ratio most industry groups should trade at? So that for newbies who were to say calculate earnings at $0.50 a share, would we apply 5 x earnings if it was construction, mining, or 10 x if it was healthcare and so forth, before contrasting to current SP? i know it sounds stupid but how do you self-rationalise if 'someone will pay more than i will'? any method to the madness?

Sorry, I guess I've literally just asked how you conduct your investment/trading plan and processes... but just so many questions to feed the curious mind.