Session 3: The Groundwork for an intrinsic valuation

This session started with a look at a major investment banking valuation of a target company in an acquisition and why having a big name on a valuation does not always mean that a valuation follows first principles, with the first principle being We began our intrinsic value discussion by talking about the weapons of mass distraction. If you want to read the blog post I have on the topic, try this link:
aswathdamodaran...
After setting the table for the key inputs that drive value - cash flows, growth, risk, we looked at the different ways of approaching valuation (Dividend Discount model, FCFE model, firm valuation) and the roots that they share, and how they result in different estimation processes. Next session, we will continue with a discussion of risk free rate, a foundational number that will drive the rest of our calculations. I have attached a post class test for today, with the solution.
Start of the class test: www.stern.nyu....
Slides: www.stern.nyu....
Post class test:www.stern.nyu....
Post class test solution: www.stern.nyu....

[@florianberthier962]

thank you so much for all your videos professor-this is pure gold, very valuable knowledge

[@aayushmanmusicproduction2407]

Thank you sir, this is pure gold! Very generous of you to post these here :)

[@touveenthakur2044]

Love your classes, sir👍

[@finexbusinessadvisors4238]

Prof. how to decide the discounting rate to be used. Typically it is based on CAPM which involves determining beta and market returns. Typically we use debt adjusted beta of comparable companies for constructing CAPM rate while we should add some alpha which is a special return expected for that particular company. Is there any other way to determine the discount rate?

[@rishitritz]

Hello Professor, Wanted to know if there is a cheaper alternative of S&P capital iq..

[@paigeplumlee]

You can get a lot of the same historical data from Yahoo Finance, which is pretty affordable.

[@John__Rambo]

I’m an avid fan of urs But i have shares of ADANI Wilmar @ 700 shall i hold it or try to sell it ? Plzz advice sir 🙏

[@throwup7157]

HOLD☕️🚪