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Valuation Seminar

This is a three-day valuation seminar that I teach once a year at the Stern School of Business in New York. The most recent version was run from July 20, 2015 to July 22, 2015, and the details are below.

 

Pre-seminar work: There is no required pre-reading for the class. If you do want to get a jump on the class, check out this pre-seminar webpage.

To follow the seminar: You will see the link to the webcast in the first column, the contents for the session in the second column, additional files in the third and in-practice webcasts on specific estimation challenges (estimating risk free rates, betas, equity risk premiums) in the last one.

After you finish the seminar: Check out this post-seminar webpage. It contains the excel spreadsheets with all the valuations that we did in class, readings to exhaust you and more fun stuff!!

Lecture Notes/Textbook: The lecture notes for this class can be obtained by clicking here. If you feel the urge to supplement these notes with a book or books, you have the following choices: Investment Valuation (3rd Edition), Damodaran on Valuation (2nd Edition), The Dark Side of Valuation (2nd Edition) and The Little Book of Valuation (1st Edition). You can find out more about these books by clicking here.

Session

Topic

Additional files

In-practice webcasts

Day 1

Morning Session

- Streaming Video

- Video download

 

Lecture Notes: Pg 1-30

Introduction to valuation

Valuation approaches

Amgen & Tata Motors

Risk free rate
Equity Risk premiums

Valuations

  1. Amgen valuation
  2. Tata Motors valuation

 

 

Risk free rate

Day 1

Afternoon Session

- Streaming Video

- Video download

 

Lecture Notes: Pg 31-86

Equity Risk Premiums

Beta

Bond Default Spreads

Debt ratios
Cost of capital

 

 

Datasets

  1. Implied ERP
  2. Sector average betas
  3. Effective tax rates
  4. Cost of capital by sector


  1. Implied ERP
  2. Bottom up Beta
  3. Lease converter
  4. Debt & Cost of Debt
  5. R&D converter

Day 2

Morning Session

- Streaming Video

- Video download

 

 

Lecture Notes: Pg 87-131

Cash Flows

Growth Rates

Terminal Value
Value Enhancement

Acquisition Valuation

Datasets
  1. Excess Returns by sector
  2. Historical growth rates

 

 

  1. ROIC estimator
  2. Terminal Value Check

 

Day 2

Afternoon Session

- Streaming Video

- Video download

 

 

Lecture Notes: Pg 132-185

More value enhancement

Loose Ends in Valuation

 

 

 

  1. Valuing Employee Options

Day 3

Morning Session

- Streaming Video

- Video download

 

 

Lecture Notes: 186-252

Numbers and Narratives

The Dark Side of Valuation

- Across the life cycle

The Dark Side of Valuation
- Across sectors

 

  1. Variances in firm & equity value by sector

 

  1.  Valuing a company
  2. Valuing equity in a distressed company as an option

Day 3

Afternoon Session

- Streaming Video

- Video download

Lecture Notes 253-End

The Dark Side of Valuation

- Across the ownership cycle

Value and Price
Relative Valuation - Steps to effective pricing

  1. Earnings multiples
  2. Book value multiples
  3. Revenue multiples
  4. Market regressions
  1. EV. Firm and Equity Value
  2. Multiples & Fundamenatals