Aswath Damodaran

Aswath Damodaran
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I teach corporate finance, valuation and investment philosophies at the Stern School of Business at New York University. I have online versions of all three courses here, as well as other finance-related videos. 1. The Corporate Finance Online playlist has an introductory video and 36 sessions that cover all of corporate finance (at least as I see it). 2. The Valuation playlist has 25 sessions that cover valuation approaches, issues and questions.3. The Investment Philosophies playlist has sessions that cover different investment philosophies.4. The Accounting and Statistics playlists reflect my quirky and unorthodox introductions to two disciplines that are critical to my valuation and corporate finance classes.5. The Blog Posts playlist has sessions that go wit my blog posts and reflect my standing as a dabbler, rather than expert, in all things finance-related. If you need the supporting material for any of the classes, check the links below.Links:Corporate finance materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/corpfin.htmlValuation materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/equity.htmlInvestment Philosophies: http://www.stern.nyu.edu/~adamodar/New_Home_Page/invphil.htmBooks: http://www.stern.nyu.edu/~adamodar/New_Home_Page/public.htmMy website: http://www.damodaran.com

  1. 4h ago

    The Greatest Cash Machine in History: An Analysis of Apple (February 2017)

    Apple is one of the great cash machines of all time, a company that has returned more cash ($183 billion) over the last five years than any other company in the world, while simultaneously building a cash balance of almost $250 billion. In a quarterly ritual that I started in 2010, I value Apple after its most recent earnings report (end of January 2017) and find it fully priced after an extended period where it was under valued (and in my portfolio). That is, though, based on my story and you are free to come up with yours and use my spreadsheet to convert to value.Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/AppleCashMachine.pdfBlog Post: http://aswathdamodaran.blogspot.com/2017/02/apple-greatest-cash-machine-in-history.htmlValuation Spreadsheet: http://www.stern.nyu.edu/~adamodar/pc/blog/AppleFeb2017.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

    The Greatest Cash Machine in History: An Analysis of Apple (February 2017)

  2. 9h ago

    Session 9: Betas - Drivers and Determinants

    In this class, we looked past regression betas at how the choices companies make about the businesses they enter can determine their betas.. Summarizing the class, here is what we listed as the three determinants of betas:1. Betas are determined in large part by the nature of your business. While I am not an expert on strategy, marketing or productions, decisions that you make in those disciplines can affect your beta. Thus, your decision to go for a price leader as opposed to a cost leader (I hope I am getting my erminology right) or build up a brand name has implications for your beta. As some of you probably realized today, the discussion about whether your product or service is discretionary is tied to the elasticity of its demand (an Econ 101 concept that turns out to have value)... Products and services with elastic demand should have higher betas than products with inelastic demand. And if you do get a chance, try to make that walk down Fifth Avenue...2. Your cost structure matters. The more fixed costs you have as a firm, the more sensitive your operating income becomes to changes in your revenues. 3. Financial leverage: When you borrow money, you create a fixed cost (interest expenses) that makes your equity earnings more volatile. Thus, the equity beta in a safe business can be outlandishly high if has lots of debt. The levered beta equation we went through is a staple for this class and we will revisit it again and again. So, start getting comfortable with it. I know that the last part of this class was a grind with numbers building on top of numbers. In specific, we looked at how to estimate the beta for not only a company but its individual businesses by building up to a beta, rather than trusting a single regression. With Disney, we estimated a beta for each of the five businesses it was in, a collective beta for Disney's operating businesses and a beta for Disney as a company (including its cash). Slides: https://pages.stern.nyu.edu/~adamodar/podcasts/cfspr23/session9slides.pdfPost class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session9atest.pdfPost class test solution: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session9asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 9: Betas - Drivers and Determinants

  3. 13h ago

    Session 6: Measuring Relative Risk (Equity) and Cost of Debt

    In today’s class, we started by reviewing the pitfalls of regression betas and went on to talk about bottom up betas, focusing on defining comparable firms and expanding the sample. I did make a big deal about bottom up betas, but may have still not convinced you or left you hazy about some of the details. If so, I thought it might be simpler to just send you a document that I put together on the top ten questions that you may have or get asked about bottom up betas. I think it covers pretty much all of the mechanics of the estimation process, but I am sure that I have missed a few things.http://www.stern.nyu.edu/~adamodar/New_Home_Page/TenQs/TenQsBottomupBetas.htmWe then started on the cost of debt, starting with a definition of the cost of debt as a long term, current cost of borrowing and laying out a procedure for estimating this cost. Next session, we will complete the cost of capital discussion and move on to cash flows.Start of the class test: http://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/beta&wacc.pdfSlides: http://www.stern.nyu.edu/~adamodar/podcasts/valUGspr17/session6.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session6test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session6soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 6: Measuring Relative Risk (Equity) and Cost of Debt

  4. 18h ago

    Session 9: Growth Rates

    (The first 35 minutes of class were taken up by the first quiz and that time was not recorded. The rest of the class was recorded.)In the session, which occurred after the quiz i, we started on our assessment of growth rates, starting with historical growth rates, before looking at analysts estimates of growth and why they do not carry more predictive power (given that analysts often are immersed in company-specific knowledge and have access to management). We then looked at tying growth to two fundamental questions: (1) how much companies reinvest and (2) how well. The way we measure these can vary depending on whether you look at earnings per share, net income or operating incomeSlides: https://www.stern.nyu.edu/~adamodar/podcasts/valspr23/session9slides.pdfPost class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session9test.pdfPost class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session9soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 9: Growth Rates

  5. 22h ago

    Session 4: Closing the books on the objective function and Opening the one on Risk

    The objective function matters, and there are no perfect objectives. That is the message of the last two classes. Once you have absorbed that, I am willing to accept the fact that you still don't quite buy into the "maximize value" objective. That is fine and I would like you to keep thinking about a better alternative with three caveats. First, you cannot cop out and give me multiple objectives - I too would like to maximize stockholder wealth, maximize customer satisfaction, maximize social welfare and employee benefits at the same time but it is just not doable. Second, your objective function has to be measurable. In other words, if you define your objective as maximizing the social good, how would you measure social good? Third, take your objective (and the measurement device you have developed) and ask yourself a cynical question: How might managers game this system for maximum benefit, while hurting you as an owner? In the long term, you may almost guarantee that this will happen. In the last part of the class, I defined risk and started on what goes into a good risk and return model.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr17/session4.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session4test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session4soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 4: Closing the books on the objective function and Opening the one on Risk

  6. 1d ago

    Session 11: Growth generalized!

    The first 35 minutes of this class were taken up by the first quiz. In the shortened session after the quiz, which occurred after the quiz i, we started on our assessment of growth, especially when returns on capital and margins are changing. We focused on the three elements that go into the story/numbers for a company: its revenue growth rate, determined by the size of the market and extent of market share, its operating margin driven by unit economics and competitions and its investment efficiency. The key as I noted is to tie your inputs on these not only to a story that you have for the company but one that makes internal sense.Slides: https://pages.stern.nyu.edu/~adamodar/podcasts/valUGspr23/session11slides.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 11: Growth generalized!

  7. 1d ago

    Session 10: Closure on Cost of Equity

    (Quiz in first 30 minutes)We started class today by looking at the process of estimating betas for the remaining public companies in the mix, with financial service companies being treated a little differently, because debt is impossible to nail down, and levering and unlevering betas is tough to do. We also examined how to estimate the cost of equity of a private company, and why it may be higher than an otherwise equivalent public company.Slides: https://pages.stern.nyu.edu/~adamodar/podcasts/cfspr23/session10slides.pdfPost class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session10test.pdfPost class test solution: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session10soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 10: Closure on Cost of Equity

  8. 1d ago

    Session 3: Managers, Markets and Morality

    This session extended the discussion of everything that can wrong in the real world. Lenders, left unprotected, will be exploited. Information can be noisy and markets can be irrational. Social costs can be large. Relating back to class, I have a couple of items on the agenda and neither requires extensive reading or research. I would like you to think about market efficiency without any preconceptions. You may believe that markets are short term, volatile and over react, but I would like you to consider the basis of these beliefs. Is it because you have anecdotal evidence or because you have been told it is so or is it based upon something more concrete? i also want to think about how managers in publicly traded companies can position themselves best to consider the public good, without being charitable with other people's money, as a precursor to the next class. We have spent a couple of sessions being negative - managers are craven, markets are noisy and bondholders get ripped off. In the next session, we will take a more prescriptive look at what we should be doing in this very imperfect world. This session extended the discussion of everything that can wrong in the real world. Lenders, left unprotected, will be exploited. Information can be noisy and markets can be irrational. Social costs can be large. Relating back to class, I have a couple of items on the agenda and neither requires extensive reading or research. I would like you to think about market efficiency without any preconceptions. You may believe that markets are short term, volatile and over react, but I would like you to consider the basis of these beliefs. Is it because you have anecdotal evidence or because you have been told it is so or is it based upon something more concrete? i also want to think about how managers in publicly traded companies can position themselves best to consider the public good, without being charitable with other people's money, as a precursor to the next class. We have spent a couple of sessions being negative - managers are craven, markets are noisy and bondholders get ripped off. In the next session, we will take a more prescriptive look at what we should be doing in this very imperfect world. Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr17/session3.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session3test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session3soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

    Session 3: Managers, Markets and Morality
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About

I teach corporate finance, valuation and investment philosophies at the Stern School of Business at New York University. I have online versions of all three courses here, as well as other finance-related videos. 1. The Corporate Finance Online playlist has an introductory video and 36 sessions that cover all of corporate finance (at least as I see it). 2. The Valuation playlist has 25 sessions that cover valuation approaches, issues and questions.3. The Investment Philosophies playlist has sessions that cover different investment philosophies.4. The Accounting and Statistics playlists reflect my quirky and unorthodox introductions to two disciplines that are critical to my valuation and corporate finance classes.5. The Blog Posts playlist has sessions that go wit my blog posts and reflect my standing as a dabbler, rather than expert, in all things finance-related. If you need the supporting material for any of the classes, check the links below.Links:Corporate finance materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/corpfin.htmlValuation materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/equity.htmlInvestment Philosophies: http://www.stern.nyu.edu/~adamodar/New_Home_Page/invphil.htmBooks: http://www.stern.nyu.edu/~adamodar/New_Home_Page/public.htmMy website: http://www.damodaran.com

Information

  • Creator
    Aswath Damodaran
  • Years Active
    2026
  • Episodes
    722
  • Rating
    Clean

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