May 7, 2022Liked by Tiago Dias

A very high quality article my friend!!! πŸ‘πŸ‘

One thing we disagree on is the valuation, but that’s because of the difference in methodology. I use DCF and I get to a fair value of 166 dollars per share ;-)

I enjoyed the read, keep them coming!


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That's fair!

I try to keep my valuation methods consistent from company to company in order to ensure they are comparable, but that does bring issues where i'm effectively looking back in time, and expecting the same performance going forward.

I could mess with some of the assumptions, especially in terms of future growth, and that would result in lower valuations, I could increase my margin of safety.

That said, I don't like doing those things because it would be inconsistent with the other valuations I do on this blog, so they wouldn't be comparable.

Still, it's definitely worth considering future prospects when deciding to invest!

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May 27, 2022Liked by Tiago Dias

Hi Tiago and European DGI - I find both blogs very valuable but since I am new to dividend investing and still learning how to evaluate companies I am quite confused how come that FV difference between both of you is so large it is 166 vs 320. How to interpret this?

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May 27, 2022Β·edited May 27, 2022Author

Hello Michal,

I'm not sure exactly how EDGI calculated his fair value, so i can't make a statement on his valuation.

That said, my valuation methods are public, and you can download the excel sheet with the valuation model from my previous post where i made it public (https://tiagodias.substack.com/p/discounted-earnings-model?s=w), and replicate it yourself.

As for "why the difference?", please keep in mind the limitations of the valuation models I use. First and foremost, the models I use are intended to be generic and applicable to every company, this naturally mean certain edge cases are ignored or set aside in favor of consistency. It also means that I'm heavily dependent on historical data, and future performance may be significantly different, in such a way that it positively or negatively impacts the expected fair value.

I would imagine that's what happened here, I would think that EDGI is taking into account the significant capex expenses the business will be undertaking going forward, and has a significantly different forward outlook which is depressing the valuation compared to my "historic data only" methods.

It's certainly worth considering such a bearish case, and it's one of the reasons why I tend to stick to less "growthy" and more stable businesses, since even minor changes in growth rates or interest rates can meaningfully affect valuations.

I hope it helps understand my methods!

Best regard,


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May 7, 2022Liked by Tiago Dias

Very good article and analysis, similar to the presentation by European DGI recently. I will also not invest in TXN as i am already exposed to Intel.

Would appreciate an analysis of TROW as I believe they are in BUY territory.

Thanks and keep up the good work.

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I haven't looked at TROW yet, but I'll add it to the list!

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