Understanding stock valuation is crucial for investors. In this episode of the Investing for Beginners podcast, we explore valuation basics, stock-based compensation, and why Warren Buffett emphasizes buying stocks like he buys socks—when they're on sale.

• 
  [00:00:50 ] Introduction to valuation and stock-based compensation concepts.


• 
  [00:01:11 ] Buying stocks means owning part of a business.


• 
  [00:01:33 ] Valuation determines if a stock's price is fair.


• 
  [00:02:30 ] Importance of paying a good price for stocks.


• 
  [00:03:16 ] Warren Buffett buys stocks like socks—when they're discounted.


• 
  [00:03:42 ] Various methods exist for valuing companies.


• 
  [00:04:18 ] Discounted cash flow models project future cash flows.


• 
  [00:05:17 ] Free cash flow models analyze cash flow statements.

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