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Glad to see someone put some numbers together with my idea, as I have yet to have a chance to.

I agree with Saul and Denny that trying to use a forward-looking number for this metric is probably not a great idea. Using the latest quarter's number is probably better. Adding on the additional factor with the yet-to-be-determined coefficient should help account for the trajectory of a given business (quarter over quarter R40 change x TBD coefficient).

Determining the proper coefficient as I have envisioned it would include trying to normalize the values to be closer to each other, and could use price ranges from a number of different quarters (a la Tom Engle's trading ranges). For a given period (a quarter), the sales number and the R40 and the quarter-over-quarter change in the R40 would be set numbers with the EV varying with the share price.

I'm hoping that later in the week next week I might be able to put together something to try to determine a proper coefficient that brings the concept together.

volfan84
Time to watch my #7 Vols face #1 Gonzaga
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