Atlassian (TEAM) is a company that develops various software products worldwide. The company has strong fundamentals as it generates positive free cash flow and has a competitive advantage. However, we remain neutral on the company due to valuation risks. Competitive Advantage There are a couple of ways to quantify a company's competitive advantage using only its income statement. The first method involves calculating the earnings power value (EPV). Earnings power value is measured as adjusted EBIT after tax, divided by the weighted average cost of capital, and reproduction value can be measured using total asset value.
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