Explorez tous les épisodes du podcast Aswath Damodaran

In this class, I did a quick review of the class using the findings from the project analyses done by people in the class. You can find the slides as well as the summary numbers for the companies analyzed.Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/ProjSumm16.pdfCompany numbers: http://www.stern.nyu.edu/~adamodar/pc/cfanalysis/cfspr16.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I look at dividends and buybacks as alternate mechanisms for returning cash to shareholders and potential dividends, and how to scale these numbers for comparison across firms.Datasets: 1. https://pages.stern.nyu.edu/~adamodar/pc/datasets/divfund.xls2. https://pages.stern.nyu.edu/~adamodar/pc/datasets/divfcfe.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this class, I did a quick review of the class using the findings from the project analyses done by people in the class. You can find the slides as well as the summary numbers for the companies analyzed.Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/ProjSumm16.pdfCompany numbers: http://www.stern.nyu.edu/~adamodar/pc/cfanalysis/cfspr16.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In small businesses, it is common to apply what is called a "key person" discount to appraised value, reflecting the reality that the loss of that one person can create a significant change in its fortunes. While that practice is not explicitly followed when valuing bigger businesses, and especially publicly traded ones, the OpenAi fiasco (where the board fired Sam Altman, the face of the company, and then found itself fired a week later) and the long standing question of how much Elon Musk adds to (or detracts from) Tesla's value indicates it is important even at larger entities. In this session, I look at the variety of people who can be key to an organization's value (from founder/CEOs to celebrity spokesperson), before creating value and pricing frameworks for valuing/pricing their presence. I also look at how businesses can manage key person risk, why it can vary across businesses and implications for employee compensation. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/KeyPerson.pdfBlog Post: https://aswathdamodaran.blogspot.com/2023/12/the-difference-makers-key-persons.html Learn more about your ad choices. Visit megaphone.fm/adchoices

In this class, we looked at valuation as the place where all of the pieces of corporate finance come together - the end game for your investment, financing and dividend decisions. After drawing a contrast between valuation and pricing, we looked at the four drivers of value: cash flows, growth rates, discount rates and when your company will be a stable growth company. We then looked at how these numbers can be different depending on whether you take an equity or firm perspective to valuation and what causes these numbers to change. In particular, we argued that while no one can lay claim on the "right" value, we still need to be internally consistent with our assumptions. High growth generally will be accompanied by high reinvestment and high risk, and as companies mature, their growth and reinvestment characteristics should change. Ultimately, though, the best way to learn valuation is by playing with the numbers and seeing how value changes.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfUGspr16/Session27.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session27atest.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session27asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I look at the choice between debt and equity that every business has to make through the data lens. I explain how I scale debt to capital, cash flows and earnings.Datasets:1. https://pages.stern.nyu.edu/~adamodar/pc/datasets/dbtfund.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this class, we looked at valuation as the place where all of the pieces of corporate finance come together - the end game for your investment, financing and dividend decisions. After drawing a contrast between valuation and pricing, we looked at the four drivers of value: cash flows, growth rates, discount rates and when your company will be a stable growth company. We then looked at how these numbers can be different depending on whether you take an equity or firm perspective to valuation and what causes these numbers to change. In particular, we argued that while no one can lay claim on the "right" value, we still need to be internally consistent with our assumptions. High growth generally will be accompanied by high reinvestment and high risk, and as companies mature, their growth and reinvestment characteristics should change. Ultimately, though, the best way to learn valuation is by playing with the numbers and seeing how value changes.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr16/Session25.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I explain why we compute historical returns as well as the process of computing these returns for the different asset classes that I follow.https://pages.stern.nyu.edu/~adamodar/pc/datasets/histretSP.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I look at the margin of safety as a tool for dealing with uncertainty. While it is intuitive, there are serious misconceptions that get in the way of it being used effectively. Blog post: http://aswathdamodaran.blogspot.com/2016/05/dcf-myth-31-margin-of-safety-tool-for.htmlSlides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/MOS.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Every year, I start by updating data on my webpage on industry averages on variables that I find myself using in my corporate financial analysis and valuation, and since there is no cost to sharing, you are welcome to use this data as well. This year's dataset includes 47,698 publicly traded companies in 134 countries, and the averages cover risk, accounting return, profitability, leverage and dividend variables. I explain some of the choices that I make in computing these industry statistics, and suggest some caveats (which you are welcome to ignore). You are welcome to use this data and I hope you find it useful! Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/DataUpdate1for2014.pdfBlog Post: https://aswathdamodaran.blogspot.com/2024/01/data-update-1-for-2024-data-speaks-but.htmlCurrent data: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datacurrent.htmlArchived data: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/dataarchived.html Learn more about your ad choices. Visit megaphone.fm/adchoices

In today's class, we put the closing touched on dividend policy analysis by going through the possess of estimating FCFE, the cash flow left over after capital expenditures, working capital needs and debt payments. My suggestion is that you estimate the aggregate FCFE over 5 years (or as many years as you have data) and compare it to the cash returned. If the cash returned = FCFE, you have a rare company that pays out what it can afford in dividends. We then moved on to lay the foundations of valuation and ended the class by talking about the distinction between valuing equity and valuing an entire business. Finally, the post class test and solution are attached.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfUGspr16/Session26.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session26atest.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session26asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

I teach in the spring of each year, and ahead of my Spring 2024 classes (two sections of valuation for the MBAs and one for the undergraduates), I would like to invite to partake. While you have to be an NYU student to be in the physical classroom, you can watch and take the classes virtually, with the constraints being your broadband and time. In this session, I explain what these classes cover, as well as the other online classes that you can access on my webpage. I also provide some guidance on picking the class to take, and the format for that class. I hope to see you in class!Slides:Blog Post:Links to classes (in different formats):Accounting 101: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastacctg.htm Foundations of Finance: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastfoundationsonline.htm Statistics: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcaststatistics.htm Corporate Finance (MBA): https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastcfspr24.htm Corporate Finance (Online Free: https://pages.stern.nyu.edu/adamodar/New_Home_Page/webcastcfonline.htm Corporate Finance (NYU Certificate): https://execed.stern.nyu.edu/products/corporate-finance-with-aswath-damodaran Valuation (MBA): https://pages.stern.nyu.edu/~adamodar/New_Home_Page/equity.html Valuation (Undergrads) https://pages.stern.nyu.edu/~adamodar/New_Home_Page/equityUG.html Valuation (Online Free) https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastvalonline.htm Valuation (NYU Certificate) https://execed.stern.nyu.edu/products/advanced-valuation-with-aswath-damodaran Inv Philosophies(Online Free): https://pages.stern.nyu.edu/~adamodar/New_Home_Page/invphil.htm Inv Philosophies (NYU Certificate): https://execed.stern.nyu.edu/products/investment-philosophies-with-aswath-damodaran Learn more about your ad choices. Visit megaphone.fm/adchoices

In this class, we put the closing touched on dividend policy analysis by going through the possess of estimating FCFE, the cash flow left over after capital expenditures, working capital needs and debt payments. My suggestion is that you estimate the aggregate FCFE over 5 years (or as many years as you have data) and compare it to the cash returned. We ended the class by talking about the distinction between valuing equity and valuing an entire business.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr16/Session24.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session24test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session24soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

As we start on 2024, it is worth noting how much the mood has shifted in the last year. At the start of 2023, dark clouds were gathering. Inflation was out of control and a recession seemed imminent, but the S&P 500 surprised us all by delivering a 26% return. That recovery was uneven, with seven stocks accounting for a big portion of the gain, and disparate returns across sectors. The 2024 outlook is much sunnier, with the consensus shifting to a soft landing and inflation largely under control, and those higher expectations may be the biggest challenge for equities this year. The expected return (8.48%) and the equity risk premium (4.60%) for the S&P 500 do not set off red flags, by themselves, but an intrinsic value of the index (see link) leads me to conclude that stocks are over valued by about 9%, to start the year. Your outlook on earnings and interest rates may be different from mine, leading you to a different valuation and conclusion. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/DataUpdate2for2024.pdfBlog Post: https://aswathdamodaran.blogspot.com/2024/01/data-update-2-for-2024-stock-comeback.htmlValuation of the S&P 500 on January 1, 2024: https://pages.stern.nyu.edu/~adamodar/pc/blog/S&P500ValueJan2024.xlsxHistorical Returns on stocks - 1928 -2023: https://pages.stern.nyu.edu/~adamodar/pc/datasets/histretSP.xlsxHistorical expected returns and implied premiums for S&P 500: https://pages.stern.nyu.edu/~adamodar/pc/datasets/histimpl.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this webcast, I look at why we feel that we are in the age of uncertainty and the natural responses (mostly unhealthy) that we have to its presence in business and investing. I also look at coping mechanisms that we can use to deal with uncertainty and why I think that this may be an edge in investing.Blog post: http://aswathdamodaran.blogspot.com/2016/05/dcf-myth-3-you-cannot-do-valuation-when.html Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/DCFMythUncertainty.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

The undergraduate class is officially rolling, and thank you tuning in. During the session, I told you that that this was a class about valuation in all of its many forms – different approaches (intrinsic, relative & contingent claim), different forums (for acquisitions, value enhancement, investing) and across different types of businesses (private & public, small and large, developed & emerging market). After spending some time laying out the script for the class (quizzes, exams, weekly tortures), I laid out the philosophical foundations for valuation, by noting that it is a bridge between story and numbers and that it is different from pricing. Home page for class: https://pages.stern.nyu.edu/~adamodar//New_Home_Page/equityUG.htmlStart of the class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/firstclass.pdfSyllabus: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/eqUGsyllspr24.pdfPost-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session1test.pdfPost-class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session1soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

In this shortened class, we moved on to look at how much a company can afford to pay out as dividend. This measure, that I titled FCFE, is the cash left over after taxes, reinvestment needs and net debt payments. When a company pays out less than its FCFE, it is accumulating cash, and we laid the foundations for analyzing dividend policy by asking the key question: do you trust managers with your cash? During the session, we applies this framework to the Disney, Vale and BP.. Post class test and solution attached Until next time!Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr16/Session23.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session23test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session23soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

The class started with a test on whether you can detect the direction bias will take, based on who or why a valuation is done. The solutions are posted online on the webcast page for the class. We then moved on to talk about the three basic approaches to valuation: discounted cash flow valuation, where you estimate the intrinsic value of an asset, relative valuation, where you value an asset based on the pricing of similar assets and option pricing valuation, where you apply option pricing to value businesses. With each approach, we talked about the types of assets that are best priced with that approach and what you need to bring as an analyst/investor to the table. For instance, in our discussion of DCF valuation and how to make it work for you, I suggested that there were two requirements: a long time horizon and the capacity to act as the catalyst for market correction. Since I mentioned Carl Icahn and Bill Ackman as hostile acquirers (catalysts), you may want to look at Herbalife, the company that Ackman has targeted as being over valued and Icahn did for being under valued. See if you can get a list going of how each is trying to be the catalyst for the correction... and think about the dark side of this process. We will be starting on the first lecture note packet on Monday.Home page for class: https://pages.stern.nyu.edu/~adamodar//New_Home_Page/equityUG.htmlStart of the class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/biasshort.pdfProject: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/eqprojspr24.pdfSlides: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/ValIntroSpr24.pdfPost-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session2test.pdfPost-class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session2soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, we began by looking at bad reasons for paying dividends (more certain than capital gains, excess cash this year) as well as good reasons (investment clientele, signaling & debt/equity conflicts). We then came up with a measure of potential dividends (FCFE) and examined the consequences of paying out less or more to stockholders, and why some companies have more flexibility than others.Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfUGspr16/Session25.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25atest.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

After a calamitous year for bond in 2022, investors faced 2023 with trepidation, but as with stocks, bonds delivered a positive surprise. Short term treasury rates rise, perhaps in response to the Fed's bellicosity, but treasury bond rates stayed unchanged. In fact, the behavior of the bond market and the response of the economy in 2023 tested two widely held nostrums in markets - that the Fed sets interest rates and that a downward sloping yield curve is a precursor to a recession - and found both fell short. Government bond rates in other currencies also mirrored US dollar rates, and followed a strong rise in 2022 with little change in 2023. For companies, the biggest change during the year was that default spreads decreased significantly during the course of the year, as investors became less fearful.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/DataUpdate3for2024.pdfBlog Post: Learn more about your ad choices. Visit megaphone.fm/adchoices

In this shortened class, we moved on to look at how much a company can afford to pay out as dividend. This measure, that I titled FCFE, is the cash left over after taxes, reinvestment needs and net debt payments. When a company pays out less than its FCFE, it is accumulating cash, and we laid the foundations for analyzing dividend policy by asking the key question: do you trust managers with your cash? During the session, we applies this framework to the Disney, Vale and BP.. Post class test and solution attached Until next time!Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr16/Session23.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session23test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session23soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Risk is at the center of finance, both in the context of business decision making and investments. In this session, I start by breaking risk down into buckets and looking at the evolution of measures of risk. I look at differences across companies and regions, using both price-based and intrinsic risk measures. I then look at risk variations across countries and how they play out as different equity risk premiums. In closing, I look at how the inputs in this and the prior to two data updates help in computing the cost of capital, why that cost of capital affect decision making and the distribution of costs of capital, at the start of 2024.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/DataUpdate4for2024.pdfBlog Post: https://aswathdamodaran.blogspot.com/2024/01/data-update-4-for-2024-danger-and.htmlCost of capital paper: https://pages.stern.nyu.edu/~adamodar/pdfiles/papers/costofcapital.pdfCountry risk paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4509578Equity Risk Premiums, by country: https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctryprem.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

This quiz will cover all of capital structure, from the trade off to optimizing the mix to the right kind of debt.Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/reviewQuiz3.pdfPast quiz 3s: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/prqz3.pdfPast quiz 3 solutions: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/prqz3sol.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I laid out the structure for the class and an agenda of what I hope to accomplish during the next 15 weeks. In addition to describing the logistical details, I presented my view that corporate finance is the ultimate big picture class because everything falls under its purview. The “big picture” of corporate finance covers the three basic decisions that every business has to make: how to allocate scarce funds across competing uses (the investment decision), how to raise funds to finance these investments (the financing decision) and how much cash to take out of the business (the dividend decision). The singular objective in corporate finance is to maximize the value of the business to its owners. This big picture was then used to emphasize five themes: that corporate finance is common sense, that it is focused, that the focus shifts over the life cycle and that you cannot break first principles with immunity.Syllabus: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/cfsyllspr24.pdfPost class test 1: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/session1test.pdfPost class test 1 solution: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/session1soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

We spent all of the session setting up the trade off on dividends, starting with the argument that Miller/Modigliani made that dividends don't matter (in a world where investors are taxed at the same rate on dividends & capital gains & stock issuance is costless) to the dividends are bad school (built on the almost century long higher tax on dividends) to the dividends are good school. Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfUGspr16/Session24.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session24atest.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session24asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Estimate the foundation for all discount rates, a risk free rate. Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, we make the argument for passive investing by looking at the performance of active investors. We begin by looking at individual investors and note that they collectively under perform the market and that the under performance gets worse as they get more active. There is some cause for hope, though, since the very best investors do substantially out perform the market, especially if they stick to the companies that they know and don’t diversify too much. With mutual funds, the evidence is not favorable, since mutual funds under perform indices and the under performance cuts across all classes of mutual funds. Collectively, active investing does not seem to provide much of a payoff.Playlist for class (Intro + 42 sessions): https://youtube.com/playlist?list=PLUkh9m2BorqnZGADa8cTzeJblmrZY_SqP&si=zI2pk17pJeld4nWR Slides: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilslides25/session35.pdf Post-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilcertificate/postclass/session35test.pdf Post-class solution: https://www.stern.nyu.edu/~adamodar/pdfiles/invphilcertificate/postclass/session35soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Looks at how we define risk in finance and alternate models for risk and return. Learn more about your ad choices. Visit megaphone.fm/adchoices

We spent all of this session setting up the trade off on dividends, starting with the argument that Miller/Modigliani made that dividends don't matter (in a world where investors are taxed at the same rate on dividends & capital gains & stock issuance is costless) to the dividends are bad school (built on the almost century long higher tax on dividends) to the dividends are good school. We closed by looking at two bad reasons for paying dividends (that they are more certain, that you had a good year) and three potentially good reasons (to signal to market, to make your clientele happy and to take advantage of debt holders). Slides: http://www.stern.nyu.edu/~adamodar/podcasts/cfspr16/Session22.pdfPost class test: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session22test.pdfPost class test solution: http://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session22soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

An investment philosophy is a coherent set of beliefs about how markets work (and sometimes don't work) that underpins your investment strategies and choices, and it is a critical ingredient for successful investing in the long term. Many investors (including quite a few professional and institutional investors) lack core philosophies, and consequently end up chasing last year's winners or falling for investment scams. Others try to imitate successful investors, believing that imitation will lead to similar success in markets, but are often disappointed. There is no one "best" investment philosophy for all investors, but there is one that is right for you that fits your beliefs about markets and your personality. I have a book and a (free) online class on the process that you go through to find this philosophy, and I have updated both, with the third edition of the book available on March 31, 2026, at booksellers, and the new version of the class online (on both my webpage and as a YouTube playlist). Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/InvPhil.pdfBlog post: https://aswathdamodaran.blogspot.com/2026/03/finding-your-investing-lodestar-in.htmlBook links:Webpage for book: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/invphil3edbook.htmBooksellers: Amazon: https://bit.ly/40UqMyLBarnes and Noble: https://www.barnesandnoble.com/w/investment-philosophies-aswath-damodaran/1122867680 (25% off until March 26, 2026)Class links:My webpage: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/webcastinvphil2025.htmYouTube Playlist: https://youtu.be/jBl8FXPc9tY?si=eF0WfFZDwVpz6K1I Learn more about your ad choices. Visit megaphone.fm/adchoices

Looks at the real world issues with maximizing stock prices. Learn more about your ad choices. Visit megaphone.fm/adchoices

The month of March 2026 was dominated by one story - the war in Iran and how it would play out. The month started with questions about how long the war would last and what effects it would have on the region and on global economies in the short and long term, and it ended with those questions still unanswered. As you try to make sense of competing narratives from experts (sell-anointed and real), you may want to check out the narrative in the market. I use market data, starting with oil prices and interest rates, and moving on to risk premiums, to conclude that, at least so far, this has been a market that is trying to reassess value, given the economic consequences of war, rather than one driven by panic. Oil prices are up strongly, but there are geographic and time variations, with Brent rising more than West Texas crude, and spot prices surging more than future. Equity risk premiums, bond spreads and the volatility index are all up, but not in the magnitudes that you would see in crisis market. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/WarandOil.pdfBlog Post: https://aswathdamodaran.blogspot.com/2026/04/oil-war-and-global-economy-markets.htmlData:Day-by-day ERP: https://pages.stern.nyu.edu/~adamodar/pc/blog/AlldataMarch2026.xlsxERP by country (updated to March 31, 2026): https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctrypremApr26.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

Sets up the objective in corporate finance decision making Learn more about your ad choices. Visit megaphone.fm/adchoices

In a world where so many companies claim to be unique and futuristic, SpaceX is the real deal, a package of spaceships, satellites and AI. When he founded the company in 2002, Elon Musk announced that he was doing so to make the costs of going into space lower and to make space travel possible. While the space establishment gave the company little chance of succeeding, it has delivered on the first promise, with its reusable rocket technology allowing for much cheaper launches into space. Along the way, the company has branched out into two other businesses - an internet service business built around thousands of satellites that it has launched into space, and AI, with its acquisition of xAI. As it get ready for an IP0, I tried to value and price the company, albeit with minimalist information, since the prospectus is still not public, and there are no comparable public companies in these spaces. With different storylines for the launch, internet and LLM business, and building on the moats that SpaceX has (at least in the first two), I attach a valuation of $1.22 trillion to the company, an astonishingly high number for a company that generated $16 billion in revenues in 2025. I will revisit the valuation, once the prospectus is filed in the next few weeks, but I do not expect that public filing to change my story line by much. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/SpaceXIPO.pdfBlog post: https://aswathdamodaran.blogspot.com/2026/04/to-trillion-dollars-and-beyond-spacex.htmlValuation of SpaceX: https://pages.stern.nyu.edu/~adamodar/pc/blog/SpaceX2026IPO.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

We started class by completing the discussion of pricing and real options, at least in a big picture sense. We then 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:http://aswathdamodaran.blogspot.com/2014/03/if-it-is-strategic-growth-investment-in.htmlWe then spent some time setting up the process of discounted cash flow valuation, arguing for consistency in discounting. If the cash flows that you are discounting are cash flows to equity, estimated either as dividends or as potential dividends, the discount rate should be the cost of equity. If the cash flows that you are discounting are pre-debt cash flows, i.e,, cash flows to the firm, the discount rate has to be the cost of capital. Done right, the value of equity should be equivalent with both approaches.Start of the class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/kennecott.pdfSlides: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/ValIntro24.pdf & Slides: https://pages.stern.nyu.edu/~adamodar/podcasts/valUGspr24/session3slides.pdfPost-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session3test.pdfPost-class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session3soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Cash flows and growth rates, for valuation Learn more about your ad choices. Visit megaphone.fm/adchoices

I have been a user of Apple products since the first Mac came out in the early 1980s, and I have been an investor off and on in the company for much of its life. The announcement that Tim Cook was planning to step down as CEO after a stint of fifteen years atop the company caught my attention, and in this session, I look at his legacy. Given that Cook was preceded by Steve Jobs, it is almost unavoidable that comparisons will be made between the tenures of the two, and I do so. Without taking anything away from the Steve Jobs legend, I feel that investors and observers have underplayed how well Tim Cook has played the cards he was dealt,, as he has helped Apple transition from being the disruptive growth engine it was under Jobs to the cash machine that it became under Cook. While Cook has been critiqued for being too cautious and missing out on tech trends, the trade offs he made have worked out well for shareholders. I do believe that his discipline and restraint deserve celebration. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/CookatApple.pdfBlog post: https://aswathdamodaran.blogspot.com/2026/05/an-ode-to-restraint-lessons-from-tim.html Learn more about your ad choices. Visit megaphone.fm/adchoices

Rules on keeping terminal value in check Learn more about your ad choices. Visit megaphone.fm/adchoices

I value SpaceX a few weeks ago, using piecemeal information and entirely on narrative, and promised to return to the valuation when the prospectus was public. The prospectus has now been filed, and the offering price set, and I revisit SpaceX, armed with the additional information. At the risk of giving away the ending, my story for SpaceX has become both bigger and more volatile, bu my overall valuation for SpaceX barely budged (at $1.22 trillion) and with the $75 billion cash proceeds from the IPO, the value of equity comes in at $1.3 trillion. The prospectus does paint a picture of a company that plans a full-bore assault on the AI market, with its pluses (a potentially huge market) and its minuses (poor unit economics and huge capital expenditures). If you are surprised that a 400-page prospectus did not have a bigger impact on the valuation, I look at how financial statements affect value as a company moves through the life cycle, arguing that the types of questions that you need answered are very different, when you are valuing young businesses. I close with a description of the IPO process, and how understanding the motivations of the players involved can help in making a decision on whether you should invest in the company or trade its stock.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/SpaceXpostprospectus.pdfBlog Post: https://aswathdamodaran.blogspot.com/2026/06/a-weeks-ago-i-assessed-value-of-spacex.htmlProspectus: https://www.sec.gov/Archives/edgar/data/1181412/000162828026036936/spaceexplorationtechnologi.htmPost-prospectus valuation: https://pages.stern.nyu.edu/~adamodar/pc/blog/SpaceX2026IPOUpdated.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

Dealing with the loose ends in valuation Learn more about your ad choices. Visit megaphone.fm/adchoices

As debate has raged about whether SpaceX is worth $ 2 trillion plus, and how much Anthropic and OpenAI will be priced at, there is a parallel question that has created just as much heat on whether these stocks should be included in the S&P 500. There are many who seem to be arguing against inclusion, with three different groups (and agendas) at play - active investing professionals who arguing that inclusion will make the S&P 500 an (even more) flawed investment vehicle for passive investors, academics and experts suggesting that inclusion would expose small investors and retirees to risks that they should not be taking (of over priced and money losing companies) and politicians who feel that inclusion will enrich the billionaire founders of these companies. In truth, the index inclusion effect has weakened over time, even as passive investing has surged, and the notion that small investors are uninformed and need protection from their mistakes is condescending and wrong. There is little benefit that these companies (SpaceX, OpenAI and Anthropic) will gain from being included in the index, and that the S&P 500 needs these companies in the index to preserve its standing as an index that tracks large cap US equities. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/Indexology.pdfBlog Post: https://aswathdamodaran.blogspot.com/2026/06/indexology-index-mechanics-and.html Learn more about your ad choices. Visit megaphone.fm/adchoices

This webcast covers the material for the third quiz, all of capital structure, starting with the trade off, working through ways of optimizing the mix and ending with debt design.Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/reviewQuiz3.pdfPast quiz 3s: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/prqz3.pdfPast quiz 3 solutions: http://www.stern.nyu.edu/~adamodar/pdfiles/cfexams/prqz3sol.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

A corporate finance view of the value of control Learn more about your ad choices. Visit megaphone.fm/adchoices

Since 2008, every year, in addition to posting updated data on equity risk premiums, I have done two update papers each year. I write the first, on equity risk premiums, in March of each year, and the second, on country risk, in July. These papers are catch-all publications, reflecting everything that I know or have learned about each of these topics, mostly in the process of having to deal with them in corporate financial analysis and valuation. As a consequence, these are written for practitioners, not academics, and they are driven by pragmatism, not purity. My latest country risk update (for 2026) is now accessible and you can download the paper, if you are interested, at the link below:https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7107638 In this session, I summarize the paper, starting with the drivers of country risk - politics, corruption, exposure to violence and the strength of the legal system - before moving on to measures of country risk - sovereign ratings and CDS spreads for default risk, country risk scores and country equity risk premiums. I also talk about how these country equity risk premiums come into play when valuing companies as well as in estimating project hurdle rates in corporate finance. I close with a discussion of currencies, and why done right, valuations should be currency invariant.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/countryrisk2026.pdfBlog Post: https://aswathdamodaran.blogspot.com/2026/07/country-risk-drivers-measures-and.htmlPaper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7107638Data:1. Country equity risk premiums: https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctrypremJuly26.xlsx2. Riskfree rates, based on expected inflation: https://pages.stern.nyu.edu/~adamodar/pc/blog/DiffInflationRiskfree26.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

Relative valuation Learn more about your ad choices. Visit megaphone.fm/adchoices

In this session, I talk about two long-running stories in markets, the first relating to a SEC proposal to replace quarterly with semi-annual reporting for US firms and other to Kevin Warsh's (the new Fed chair) view that the Fed should speak less and provide less guidance. The common themes in both stories is that they remove "news" that the market has become to receiving and using to set prices, and the advocacy and opposition to both proposals share commonalities. Advocates for the changes argue that removing quarterly reporting will make makes less "short term" and that reducing Fed guidance will also reduce the gaming around Fed actions. Opponents to the changes point to the loss of information that markets can use to set prices, and increased volatility in markets.I see shades of grey. I do like access to quarterly reports in my investing, since they allow me to update my valuations more frequently, but I also believe that earnings reports have become bulky and filled with distractions. Rather than reducing the frequency of reporting, I would prefer slimmer reports that have less management guidance and prognostications.As for the Fed, I do think it is healthy for investors to step back from the post-2008 view of the Fed as an all-powerful institution that can set interest rates and alter the trajectory of the economy. Neither perception is based in reality, and a world where we see less and hear less from the Fed will be a healthier one.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/quarterly.pdfBlog post: Learn more about your ad choices. Visit megaphone.fm/adchoices

Wrapping up the final pieces of Corporate Finance Learn more about your ad choices. Visit megaphone.fm/adchoices

If you have been reading the financial press or tracing social media, the story of Leo Aschenbrenner and the rise and fall of his hedge fund, Situational Awareness, has been widely covered, with different views on causes. I use the story of this fund, created to monetize Leo's vision of AI as an immensely successful disruption in the near term, to talk about investment conviction, words often used as positives, when talking about investing. I look at the continuum of conviction from absolute certainty to complete mush, as well as the forces that cause variations in conviction across investments as well as across investors. I then follow up and argue that conviction drives two major investment choices - the sizing of an investment and how much leverage you take, with stronger (weaker) conviction leading to more concentrated (more diversified) portfolios with higher (lower) leverage. I end the session by drawing three lessons from this story: (1) that investment actions (on concentration & leverage) that are out of sync with investment conviction is deadly, (2) that momentum is a force that can upend conviction and (3) that as investor, you will be better off trusting humble money over smart money.Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/LessonsfromLeo.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

I started this class by completing a big picture perspective on discounted cash flow models, noting that while the way we get cash flows, growth rates and discount rates will vary, they are not only tied together with the same principles but require internal consistency. We started then with a discussion of risk and how it plays out in discount rates, before embarking on an assessment of riskfree rates, and with a discussion on whether the Fed sets rates and how to get riskfree rates in currencies where the government has default risk. I did mention, in passing, the possibility of negative riskfree rates and I do have a post on that:http://aswathdamodaran.blogspot.com/2016/03/negative-interest-rates-unreal.html If you want to see my updated perspective on risk free rates, try my blog post from this week::https://aswathdamodaran.blogspot.com/2024/01/data-update-3-for-2024-interest-rates.htmlStart of the class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/riskfree.pdfhttps://pages.stern.nyu.edu/~adamodar/podcasts/valUGspr24/session4slides.pdfPost-class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session4atest.pdfPost-class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session4asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

Introduction to Corporate Finance Learn more about your ad choices. Visit megaphone.fm/adchoices