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r/valueinvestingr/valueinvesting· u/Repulsive_Ad7538· 2d agoStock Analysis 0

Built a valuation tool while going deeper into Damodaran's and value investor's framework. would love critique from people who know this better than I do

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Developed a comprehensive DCF valuation tool based on Damodaran's frameworks, seeking community critique using MELI as an example.

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Hi colleagues,

I have a master's in finance and I've spent the last few years going deep on valuation — Damodaran's work specifically, value investing frameworks, trying to really understand what drives intrinsic value rather than just running multiples.

At some point I started building a tool with a friend to put the theory into practice. It runs a full FCFF DCF on any NYSE/NASDAQ stock — WACC constructed from CAPM with Damodaran's country risk premia, blended across four models (FCFF, FCFE, DDM, relative multiples) weighted by company type the way Damodaran frames it. Bear/base/bull scenarios with stressed WACC and CAGR. ROIC vs WACC spread as the moat signal. Piotroski, Altman Z, Beneish M for financial health.

The growth inputs blend historical CAGR with analyst estimates and apply a convergence discount — because no company grows at 40% forever and the mean reversion evidence is pretty clear.

I'm posting because I genuinely want to know where the methodology is wrong or incomplete. People on this sub understand this material at a level that would actually help us improve it.

A few specific things I'm uncertain about:

  • How we weight the four models for different company types
  • Whether our terminal growth calibration is defensible
  • How to better handle negative FCF companies in the DCF

Happy to go deep on the methodology in the comments.

insic.app/stock/MELI ← MELI as a sanity check example - please feel free to use the app for free, no subscription models enable AT ALL, just drafted in code. Thanks a lot!!!

Discussion · top comments1 selected
u/NoName20Investor 1· 2d ago

If you want feedback, allow guest access. I am not interested in creating a login for a service I may never use.