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time photoAre you wasting money? What would you buy if it cost you part of your life to purchase it? Would you buy worthless things? Would you invest your money if your life depended on it?

In 2011, there was a movie that didn’t do incredibly well at the box office called “In Time” starring Justin Timberlake. I won’t give away any plot twists from the movie, but the basic plot was that the amount of time that you had to live had become currency.

The movie is accurate in one very important aspect, what you spend costs you part of your life and the working poor characters at the beginning of the movie are very concerned about wasting money (or time in their case). The money that you earn is given to you in return for the time you spend working. Sure, your expertise and skill are the reason that you may make more or less than another person. However, the application of that skill or expertise over time is how you earn the money.

IntimefairuseSo if the old saying is true that “Time is money” then the money you spend is some of your time. Since you are not given more time in your life (unlike the above movie), every purchase you make costs you some amount of your precious time to create the wealth that funds that purchase. That’s what opportunity costs are all about – giving up something in return for something else that we find valuable. When you are wasting money on something that is not important, you are essentially wasting part of your precious time and wasting your life creating that money.

Your wages are an exchange for the time and expertise you committed to your job. Put simply, you were paid money for a portion of your life. The money you spend represents the hours of your life that you sacrificed to earn that income.

With that in mind, shouldn’t you spend every dollar knowing that it represents a small portion of your life? Shouldn’t you stop wasting money since it is the same thing as wasting away part of your life?

If you earn $40,000 a year, your hourly income is about $20 before tax. Before you commit to spending any of those dollars, ask yourself, “Is this purchase worth the hour of my life I gave up?”

Photo by Moyan_Brenn (back soon, sorry for not commenting)

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Company name Netflix, Inc.
Stock ticker NFLX
Live stock price [stckqut]NFLX[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Good
EPS growth Good
P/E growth Good
EBIT growth Good

ANALYSIS

Confident Investor Rating Good
Target stock price (TWCA growth scenario) $536.33
Target stock price (averages with growth) $654.83
Target stock price (averages with no growth) $371.42
Target stock price (manual assumptions) $410.98

The following company description is from Google Finance: http://www.google.com/finance?q=nflx

Netflix, Inc. is an Internet television network with more than 33 million members in over 40 countries. In the United States, the Company’s subscribers can receive standard definition digital versatile disc (DVDs), and their high definition successor, Blu-ray discs (collectively DVD), delivered quickly to their homes. The Company operates in three segments: Domestic streaming, International streaming and Domestic DVD. Domestic and International streaming segments derive revenues from monthly subscription services consisting solely of streaming content. The Domestic DVD segment derives revenues from monthly subscription services consisting solely of DVD-by-mail.

 

Confident Investor comments: At this price and at this time, I think that a Confident Investor can confidently invest in Netflix, Inc.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor. You can review the best companies that I have found (and I probably invest my own money in most of these companies) in my Watch List.

How was this analysis of Netflix, Inc. calculated?

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $347.14

Growth: 0.2

Current EPS (TTM): $2.66

P/E: 100

Future EPS Calc: $6.61

Future Stock Price Calc: $661.89

Target stock price: $410.98

I hope that this makes you a better investor. [/s2If]

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Company name Nordson Corporation
Stock ticker NDSN
Live stock price [stckqut]NDSN[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Poor
P/E growth Good
EBIT growth Good

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $75.04
Target stock price (averages with growth) $89.31
Target stock price (averages with no growth) $69.24
Target stock price (manual assumptions) $76.19

The following company description is from Google Finance: http://www.google.com/finance?q=ndsn

Nordson Corporation is a manufacturer of equipment used for precision material dispensing, testing and inspection, surface preparation and curing. Its technology-based systems can be found in production facilities globally. It serves diverse markets, including the consumer non-durable, consumer durable and technology end markets including packaging, nonwovens, electronics, medical, appliances, energy, transportation, building and construction, and general product assembly and finishing. Its products are marketed through a network of direct operations in more than 30 countries. The Company operates in three segments: Adhesive Dispensing Systems, Advanced Technology Systems and Industrial Coating Systems. In September 2013, Nordson Corporation completed the acquisition of Munster, Germany based Kreyenborg Group’s Kreyenborg GmbH and BKG Bruckmann & Kreyenborg Granuliertechnik GmbH companies.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in Nordson Corporation as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns. I am leaving Nordson on my Watch List for now as I need more companies in this space. If the metrics do not improve, I will drop the company from the list in the future.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor. You can review the best companies that I have found (and I probably invest my own money in most of these companies) in my Watch List.

How was this analysis of Nordson Corporation calculated?

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $75.45

Growth: 0.11

Current EPS (TTM): $3.31

P/E: 22

Future EPS Calc: $5.57

Future Stock Price Calc: $122.7

Target stock price: $76.19

I hope that this makes you a better investor. [/s2If]