logo

About
writing tools blog YouTube
email

My name is Aswath Damodaran, and I teach corporate finance and valuation at the Stern School of Business at New York University. I am a teacher first, who also happens to love untangling the puzzles of corporate finance and valuation, and writing about my experiences. As a result, I happen to be at the intersection of three businesses, education, publishing and financial services, that are all big, inefficiently run and deserve to be disrupted. I may not have the power to change the status quo in any of these businesses, but I can stir the pot, and this website is my attempt to do so.

Broadly speaking, the website is broken down into four sections. The first, teaching, includes all of my classes, starting with the MBA classes that I teach at Stern and including the shorter (2-day to 3-day) executive sessions I have on corporate finance and valuation. You will find not only the material for the classes (lecture notes, quizzes), but also webcasts of the classes that you can access on different forums. I also have classes specifically tailored to an online audience on valuation, corporate finance and investment philosophies. The second, writing, includes links to almost everything I have written and continue to write, starting with my books and extending to my practitioner papers (on equity risk premiums, cash flows and other things valuation-related). The third, data, contains the annual updates that I provide on industry averages, for US and global companies, on both corporate finance and valuation metrics (including multiples). It is also where I provide my estimates of equity risk premiums and costs of capital. The fourth, tools, incorporates the spreadsheets that I have developed over time to value and analyze companies and short in-practice webcasts on how to analyze companies.

I have been told that my website is ugly, and I apologize for its clunky look and feel. While some of you have offered to make it look better for me, and I thank you for your kindness, I need to be able to tweak, modify and adapt the website as I go along and to do that, I have to work with what I know about website design, which is not much. You can try the search engine below and if that does not work, try this guide to the site.

Implied Equity Risk Premium Update

Implied ERP on September 1, 2020= 5.00% (Trailing 12 month, with adjusted payout), 4.74% (Trailing 12 month cash yield); 4.99% (Average CF yield last 10 years); 4.32% (Net cash yield); 3.24% (Normalized Earnings & Payout); 4.62% (COVID Adjusted)
(COVID ERP computed with 25% earnings drop in 2020 + 80% recovery by 2025+ Lower % returned in cash flows)

Implied ERP in previous month = 5.43% (Trailing 12 month, with adjusted payout), 5.10% (Trailing 12 month cash yield); 5.37% (Average CF yield last 10 years); 4.77% (Net cash yield); 3.48% (Normalized Earnings & Payout); 5.01% (COVID Adjusted)
(COVID ERP computed with 25% earnings drop in 2020 + 80% recovery by 2025+ Lower % returned in cash flows)

Downloadable datasets (For more data, go here)

  1. Implied ERP by month for previous months
  2. Implied ERP (annual) from 1960 to Current
  3. Implied ERP (daily) from February 14, 2020 - September 1, 2020
  4. My annual update paper on ERP (March 2020)
  5. My annual update paper on Country Risk (July 2020)
  6. My data on ERP & CRP by country (January 2020, updated April 2020 and again in July 2020)

Downloadable spreadsheets (For more spreadsheets, go here)

  1. Spreadsheet to compute current ERP for current month (includes a COVID adjustment)
  2. Spreadsheet to value the S&P 500 (June 1, 2020)
  3. Valuation Spreadsheet for non-financial service firms (Corona edition) with video guidance

Other Updates

Teaching: The Spring 2019 Corporate Finance class, now fully archived, can be found here and the archived Spring 2019 Valuation class is linked here. The online versions of these classes can be found here and NYU is offering certificate versions here. I also taught three classes in the spring of 2020, but half the class was taught online, and you can find the links here: Corporate Finance and Valuation to the MBAs and Valuation to the undergraduates. If you need a short brush up on the basics of finance, I have added a class on the foundations of finance to my online list.

Writing: This paper on valuing Tesla (with Brad Cornell) won readers' award (Bernstein-Levy) in Journal of Portfolio Management. Download the latest version of my annual equity risk premium update by clicking here and the latest version of my annual country risk update by clicking here. I also have a paper on valuing users, subscribers and members. My book on Narrative and Numbers, from Columbia University Press, should be in bookstores and the third edition of The Dark Side of Valuation came out in 2018. Finally, Brad and I have written a new paper on what we call the big market delusion, on how the allure of big markets coupled with overconfident entrepreneurs/investors can create over pricing across companies. In 2020, we added a paper on ESG, a concept that has been oversold and overhyped by its proponents.

Data: The latest overall data update was on January 5, 2020; my next one will be in January 2021. My country risk premiums also get updated midyear. Check under data for downloads and links, as well as archived data from prior years. My equity risk premiums, by country, were updated on July 1, 2020 and can be found here.

Tools: Check under tools for additions to spreadsheets and webcast. uValue is available at the iTunes store.