Showing posts with label business valuations. Show all posts
Showing posts with label business valuations. Show all posts
Business Valuation
Day One
Session One:
• The Discounted Cash Flow Model
• Setting up the Model
Session Two :
• The Big Picture of DCF Valuation
• Valuation Examples
• The Discount Rate Question
Session Three :
• Open Q&A
Session Four :
• Risk premiums and Betas
• The Cost of Debt
• Estimating Cash Flows
Session Five :
• Estimating Growth Rates
• Estimating Growth Patterns
• The Terminal Value
• Closing Thoughts on DCF valuation
Session Six :
• Open Q&A
• The Discounted Cash Flow Model
• Setting up the Model
Session Two :
• The Big Picture of DCF Valuation
• Valuation Examples
• The Discount Rate Question
Session Three :
• Open Q&A
Session Four :
• Risk premiums and Betas
• The Cost of Debt
• Estimating Cash Flows
Session Five :
• Estimating Growth Rates
• Estimating Growth Patterns
• The Terminal Value
• Closing Thoughts on DCF valuation
Session Six :
• Open Q&A
Day Two
Session Seven :
• Loose Ends in Valuation
-Cash, Cross holdings and other assets
-The Value of Control, Synergy and Transparency
-The Liquidity Discount
-Employee Stock Options
Session Eight :
• The Allure of Relative Valuation
• Categorizing Multiples
• The Four Steps in Analyzing Multiples
Session Nine :
• Open Q&A
Session Ten :
• Applying Multiples in Valuation
• Finding Comparable firms
• Controlling for differences
• Picking the Right Multiple
Session Elven :
• The Real Options Story
• The Option to Delay (and valuing patents and natural resource companies)
• The Option to Abandon
• The Option to Expand
• Equity in Troubled firms as options
Session Twelve :
• Open Q&A
• Loose Ends in Valuation
-Cash, Cross holdings and other assets
-The Value of Control, Synergy and Transparency
-The Liquidity Discount
-Employee Stock Options
Session Eight :
• The Allure of Relative Valuation
• Categorizing Multiples
• The Four Steps in Analyzing Multiples
Session Nine :
• Open Q&A
Session Ten :
• Applying Multiples in Valuation
• Finding Comparable firms
• Controlling for differences
• Picking the Right Multiple
Session Elven :
• The Real Options Story
• The Option to Delay (and valuing patents and natural resource companies)
• The Option to Abandon
• The Option to Expand
• Equity in Troubled firms as options
Session Twelve :
• Open Q&A
Buffett: What students should be learning is how to value a business.
John Kenneth Galbraith once slyly observed that economists were most economical with ideas: They made the ones learned in graduate school last a lifetime. University finance departments often behave similarly. Witness the tenacity with which almost all clung to the theory of efficient markets throughout the 1970s and 1980s, dismissively calling powerful facts that refuted it “anomalies.” (I always love explanations of that kind: The Flat Earth Society probably views a ship’s circling of the globe as an annoying, but inconsequential, anomaly.)
Academics’ current practice of teaching Black-Scholes as revealed truth needs re-examination. For that matter, so does the academic’s inclination to dwell on the valuation of options. You can be highly successful as an investor without having the slightest ability to value an option. What students should be learning is how to value a business. That’s what investing is all about.
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