The higher that keger, it just might be that in that short period of time or that unique setting,

the growth rate was amazing.

But our question with valuation is not what did they do.

Obviously, they have to do something first and foremost, so I'm not discrediting it completely, but not could have been driven by a low base or a low starting point.

It must continue.

I'm Mary Long, and that's Patrick Battelato,

an associate professor of instruction at the University of Texas at Austin, McComb's School of Business, and returning guest to Motley Full Money.

Ricky Mulvey caught up with Battilato to talk about how investors can better

understand drivers of value. They discuss how to weigh intangibles, spotting

trends versus forever changes, and what's missing from commonly used financial metrics. The focus of today is how investors can understand drivers of value for a business.

So we're going to explore some ways for folks to think about them, but you're an accounting professor and many put, you know, valuation

firmly in the silo of finance.

So what is the role of accounting in this discussion on companies value?

Great, I love to answer that question.

So when we talk about valuation, we're pretty much inclined and talk about things like DCF,

discounted cash flow evaluation models,

you know, talking about cash flows and all that absolutely fits. But I would argue there's still a

layer where accounting is really essential, which is, okay, what drove that value?

And that's going to be a conversation around a company's ability to generate revenue, grow that revenue,

and then create and maintain operating profitability, which is really a conversation

where a knowledge of accounting and a knowledge of those pieces is absolutely essential in

sort of making sure that we understand, you understand, okay, how does that happen?

...