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Every company isn’t worth infinite amount of money.
Even for Warren Buffett, who is constantly quoted for “Our favourite holding period is forever“, regretted not selling his more expensive holdings such as American Express, Coca Cola, Gillette and Wells Fargo during the ridiculous valuations during the Great Bubble.
But when do you determine to sell these “forever” stocks, especially when their discounted dividend growth rate is higher than discount rate? 
I think it’s a good idea to revisit Seth Klarman’s objection of using “the present value of a projected stream of future dividend payments“. In his book “Margin of Safety”, he instead thinks looking at the overall company’s cash flow is a better way to value a company .
I agree that that’s the case when discounted dividend growth rate is higher than discount rate (as for why I don’t apply a discounted cash flow analysis instead for valuations, click here to find out), and the way to measure if a company is over-valued when discounted dividend growth rate is higher than discount rate is through Operating Income / Discounted Market Cap (Market Cap – Current Assets + Total Debt), which is influenced by Joel Greenblatt and Benjamin Graham.
As for the cut off point, since valuation all comes down to comparing to the risk free rate, I ruthlessly sell any stocks that are selling at 2/3 of the higher of the 30 year US Treasury Yield’s current yield, historical mean or historical median. That also applies as a filter to prevent myself from buying any dividend growth stock that has EV/DMC below 2/3 of the higher of the 30 year US Treasury Yield’s current yield, historical mean or historical median.
 I use a Gordon Growth Model for valuing dividend growth stocks (click here to know why), so Stock Value = Dividend / (Discount Rate – Growth Rate). When Growth Rate is higher than Discount Rate, the Gordon Growth Model implies that the stock is a buy at any price (which is absolutely not true)
 He also proposes two more methods, which is Liquidation Value and Stock Market Value.
 Joel Greenblatt mentioned the use of EBIT / Enterprise Value to value companies. I use Operating Income instead since it’s more ready available to access in stock screeners while it being very similar to EBIT. I also use my own version of Discounted Market Cap (Market Cap – NCAV) since it’s also easier to access and calculate the necessary information from stock screeners while a Benjamin Graham NCAV calculation (Current Assets – Total Debt) helps create a similar figure to Enterprise Value.
Not advice. No offer. Do not rely. May lose value. Risky. Conflicts hidden/obscured. (Borrowed from Terrence Yang‘s Disclaimer on Quora)