Value Microcaps Motherboard

[gilead23]

Stanu

I think I am saying we should ignore at least part of the impact of the tax.

Take an extreme case and say they don't have to pay taxes for the next 50 years. I would say you completely ignore taxes and treat them as if they will never be taxed.

Ultimately all you are really doing is valuing cash flows and cash flows in the future are worth less than cash flows this year or next year.

So in general suppose a company earns 25 cents a share but it would have only been 15 cents with taxes. If taxes aren't going to be paid for the next 3 years I might treat them as earning say 20 cents rather than 15.

In theory they ought to be able to use that extra money to grow the business faster than the company earning 15 cents fully taxed today.