Company Growth vs. Market Multiples: Two Paths to Returns
Investors buy shares because they hope for a return.
Returns come from either a company growing its free cash flow (growth) or the market decreasing the FCF yield (value).
Or if using earnings, the return comes from either earnings going up or the multiple going up.
There are two routes to achieving the same outcome. Some investors look to the company for returns, some look to the market, the wise look at both.
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