![]() Mobile web traffic has consistently accounted for about half of all global web traffic since the beginning of 2017.Mobile devices, excluding tablets, generated about half of all website traffic globally.The average American has access to more than ten connected devices in their household.64% of SEO marketers call mobile optimization an effective investment.The highest bounce rates are on social (45%) followed by direct (44%).Email visitors are the most likely to convert on forms - and people coming from search advertisements are the least likely.Catering & Restaurants is the industry with the highest click-through conversions on landing pages. Media & Entertainment is the industry with the highest form-fill conversions on landing pages.3.5% of ecommerce website visits via mobile are converted into purchases, compared to 3.9% on desktop.Only 17% of marketers use landing page A/B tests to improve conversion rates.( HubSpot State of Marketing Report, 2021) Events placed at the beginning of videos perform the best, with a conversion rate of 12.7%.Email collection forms were the most successful at converting viewers, with a 15% conversion rate in 2020.This article first appeared on GuruFocus. However, for the next 12 to 24 months, it is going to be incredibly difficult to understand and calculate their underlying intrinsic value and how much wealth they can ultimately create for shareholders. I have no doubt great businesses like Apple (NASDAQ:AAPL) will continue to create value in the long run. This may push down the valuation of the entire technology sector. If investors can get a guaranteed return of 5.5% from bonds, they are unlikely to turn to speculative technology stocks with uncertain futures. Higher discount rates could really impact the long-term valuation of a business for some time to come. Ultimately, the only reliable source of growth is the business itself, not the movements of investor sentiment. That means it is at the mercy of the mark environment to some extent. It is not as simple as plugging one or two numbers into a calculator and hoping for the best.Ī company is ultimately worth as much as investors are willing to pay for it. A lot of experience, research and analysis is required to try and come up with an estimate of intrinsic value. The moral of this story is, don't calculate the intrinsic value of a stock as if the discount rate and growth will stay the same forever. Still, this example does illustrate how market perceptions of businesses can change in a rising interest rate environment. Moreover, there is no guarantee that just because my calculator shows that Apple is worth $207 in one scenario, it will actually be worth that much. And there is no guarantee the 10-year Treasury yield will hit 5.5% next year. There is no guarantee the company will grow free cash flow at a compound annual rate of 10% indefinitely. I should point out at this stage that quite a lot of this valuation process, estimating discount rates and growth rates, does involve guesswork. Suddenly, Apples intrinsic value is 42% less than it was at the 1.5% discount rate! Using this figure in the discounted cash flow calculation gives an intrinsic value of $207 per share. This could translate into a 10-year treasury yield of 5.5% or more. ![]() Some analysts are projecting that the Federal Reserve could increase interest rates to around 4.75% next year. At a rate of 4%, the intrinsic value estimate drops to $246. Using this number, the intrinsic value estimate falls to $255, with growth rates kept the same. However, today, the 10-year Treasury yield stands at 3.7%, although it nearly topped out at 4% earlier in the week. This is assuming a growth rate of 10% per annum in free cash flow for the next 10 years. If we plug this figure into GuruFocuss discount cash flow calculator as the discount rate for Apple (NASDAQ:AAPL), we get a fair value of $335 per share, an increase of 58% over the current share price. This time last year, the yield on the U.S. Other common considerations include inflation and interest rates, with interest rates being particularly important to account for when it comes to companies with a lot of floating-rate debt, or those which may need to take out more debt to pay off existing debt on a systemic basis.įocusing in on Buffett's method, in order to illustrate how moving Treasury rates will impact the valuation of equities, I want to use an example from the past year. Treasury rate as his preferred discount rate with an adjustment for uncertainty. Buffett has said that he likes to use the U.S.
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