Unlocking the True Value of Stocks: How to Maximize Investments
The article discusses how to value common stocks using the capitalization of income method. This method calculates the intrinsic value of a stock by discounting future cash flows, such as dividends or terminal prices, to their present value. The value of a stock is determined by the discounted value of all future expected cash flows, with future cash flows being uncertain and dependent on the financial situation of the firm.