A great company is not a great investment if you pay too much for the stock. —Be

A great company is not a great investment if you pay too much for the stock.
—Benjamin Graham, The Intelligent Investor
After developing a fundamental understating of stocks (i.e., what they represent, how they are obtained, etc.), a prudent investor could focus on improving his or her ability to determine the value of stocks. Investing in stocks while they are undervalued can lead to impressive returns, but buying overvalued stocks can lead to painful losses. The process of valuing stocks can be difficult and is sometimes as much of an art as it is a mathematical exercise—especially when attempting to predict future cash flows for young, growing companies. In this Discussion, you will determine the value of a stock and describe how you did so with your colleagues, as well as provide a recommendation of whether or not you would recommend buying the stock.
To prepare:
Locate a common stock to use for this Discussion. (Note: You could use the NASDAQ siteLinks to an external site. from the Week 2 Discussion, or you could search for a stock on Google Finance or Yahoo Finance.)
Refer to this week’s Learning Resources on Stock Valuation and determine the value of the stock.
Review the Academic Writing Expectations for 2000/3000-Level Courses,
Post a 150- to 225-word (2- to 3-paragraph) explanation of the value of your selected common stock. In your explanation, do the following:
1. Describe the common stock that you located, including a link to the web page where you located the information about the stock.
2. Explain what the value of the stock is and describe how you determined its value.
3. Provide a rationale for why or why not you would recommend investing in the stock.
To support your response, be sure to reference at least one source provided.
Investing Made Simple. (2018). What is a preferred stock – Preferred stocks 2018Links to an external site. [Video file]. Retrieved from https://www.youtube.com/watch?v=QZUOKmqMTkw
FinanceKid. (2017). How to use dividend valuation methods to value a stockLinks to an external site. [Video file]. Retrieved from https://www.youtube.com/watch?v=7T8sgT-otDU