Organization

by Aswath Damodaran.

In valuation practice, it is common to use point estimates for input variables to arrive at a point estimate of value. This practice has its roots in the twentieth century, where data was difficult or expensive to access, and practitioners had weak tools. As data becomes more accessible and models more powerful, it is worth examining whether we can make our valuations of projects and businesses richer and more informative, by drawing on established statistical tools and we introduce three in this paper.

[Read more…] about Facing Up to Uncertainty: Using Probabilistic Approaches in Valuation

by William J. Moser.

In this manuscript, I examine the firm’s ex ante cost of equity capital in the quarter before and the quarter after the filing of a shareholder securities lawsuit as well as in the quarter before and the quarter after the final resolution of the shareholder lawsuit.

[Read more…] about The Reaction of Firm Ex Ante Cost of Equity Capital to Initiation and Resolution of Shareholder Lawsuits

by Aswath Damodaran.

This has been a year of rolling crises, some originating in developed markets and some in emerging markets, and the market has been remarkably resilient through all of them. It is now Turkey’s turn to be in the limelight, though not in a way it hoped to be, as the Turkish Lira enters what seems like a death spiral, that threatens to spill over into other emerging markets.

[Read more…] about Deja Vu In Turkey: Currency Crisis and Corporate Insanity!

Business Valuation Comparison Charts

A quartet of present and former Standards Board chairs for the National Association of Certified Valuators and Analysts (NACVA) were on hand to harmonize about valuation standards during the 2018 NACVA and the CTI’s Annual Consultants’ Conference at Caesars Palace in Las Vegas, Nevada.

[Read more…] about The Unimpeachable Standard — One Voice Cannot Harmonize with Itself

by Aswath Damodaran.

While political and trade wars are brewing around the world, centered on globalization, the enduring truth is that the globalization genie is out of the bottle, and no political force can put it back. Encouraged to spread their bets around the world, investors have shed some of the home bias in their investing and added foreign equities to their portfolios…

[Read more…] about Country Risk: Determinants, Measures and Implications – The 2018 Edition