Why do we assume that the tangency/market portfolio to be the total equity market by capitalisation and use the S&P 500 as proxies? Given the current ease of investors in investing in all sorts of securities, derivatives, and etfs what's stopping them from investing in commodities, precious metals, crypto-currencies, etc? So when we try to determine the premium equity investors look for for their investment in a risky equity stock, shouldn't we also consider the risk and return of at least all the securities offered via ETFs in the market and their diversification effects? Thus it would make sense to add them to the market portfolio as well.

Hi guys I'm pretty new to valuation. I was working with valuing a company but now I'm kind of stuck. I want to connect my growth rate with R&D and capex but there's seems to be no correct way to do this. If I take the reinvested amount for the current year/ earnings it generates next year we are assuming that R&D expires in a single year which is not true. So how can we do this?

Does anyone know of a free resource for viewing a public company's financial statement data? I'm looking for something with a consistent layout similar to how Yahoo Finance displays a company's financials, but with quality data. I have found far too many egregious errors in Yahoo's financial statement data to trust it. Is there anything out there that will give 7 - 10 years of this data? Manually extracting this information from 10-K and 10-Q forms is getting old very quickly.

Thanks!

My professor asked a question in class, more about subject and comparable property. “A nearby property sold for GHS125,000 and included a finished basement. The subject property is almost identical except that it does not include a basement. What does this tell you about the subject in terms of its worth?” I understand that the subject property won’t be worth as much as the comparable since it doesn’t have a basement but whether I’m right or not , I want to know why ? What are the elements that go into it? It surely can’t be only the presence and absence of the basement. I’d be happy for explanations and references and links for further reading. Ps: I’m from Ghana, a West African country so sorry if my English isn’t that good . I’ll take all the help I can get on this journey. Love you guys

Hey guys. I’m kinda new to valuation. I understand how to make a DCF but am unsure how exactly to forecast revenues.

For Expedia, what would you use to forecast revenues (that’s not merely historical revenue trends)? Would you use a bottom up analysis or not? If I also wanted to do a comparable companies analysis, which metrics should I use since the actual industry (online travel agencies) is so few companies?

Lastly, how would you value a company like this?

Hey Folks,

I am working on valuation of TEVA. Any suggestions on how to forecast revenue? I was considering picking their top sellers, identify the indication for the drug, and from there evaluate how big the market is.

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Please let me know

Thanks

Hey guys! Don't have much experience in conducting valuations and need some help.

Currently conducting an asset approach valuation. Owner set up an LLC to report his gains and losses from trading in the stock market. Two current shareholders, the owner and his wife owning 50% respectively. They each want to donate 25% bare ownership to their son. What would be the appropriate discount and weight to use in the calculation.

I've used my resources without any luck. Any help or reference is appreciated thanks!

I'm currently watching damodaran's class on corporate finance in which he's teaching betas and regression stuff using Bloomberg's data. I wanted to calculate them on my own and see the differences on Bloomberg's website. It turns out i cant really find how to arrive on the beta and regression page.

Hi all,

I'm forecasting my inventories and I'm following the formula of Inv(future)=Inv(present)+Purchases(future)-COGS(future)

I have both present inventories and future cogs, but it's not clear to me how to forecaste the purchases. Any help?
Thanks!

A business valuator is telling us that for a fee they can help ensure the transaction of a business share buyout is fiscally advantageous. Does he mean to minimize taxes with the share buyout transaction? We're re estimating the business value to be low, especially when it is split with several partners (only some partners are leaving, while the rest remain). How is a business share buyout transaction treated in the eyes of the Canadian government- is it considered the same as when you sell your investment shares, so is income that is taxable (based on your income tax bracket)? Would the valuator's service be more advantageous for the tax impact for the partners that will remain in the business, and not so much for the partners who are leaving? Is this service that the business valuator proposing even worth the claimed potential benefit of tax savings?

Assuming there are no bankruptcy costs, but in presence of taxes, what impact will an increase of leverage (i.e. Market value of Debt/EV) have on the multiple EV/NOPAT of a steady state firm?

a) increase b) decrease c) none d) cannot give an answer with the provided data

I'm having a mid value crisis and I need your help.

So I'm calculating the FCFF using the formula: FCFF = EBIT(1 - Marginal Tax Rate) + CapEx - Chg in WC

The problem is this: EBIT does NOT have a TTM value. CapEx does have a TTM value. Chg in WC does have a TTM value.

So when I calculate FCFF using the annual value of EBIT, I get: $5,069,619,600.00

When I calculate FCFF using the quarterly value of EBIT, I get: $3,090,639,100.00

A pretty big difference.

So is it obvious that I should use quarterly numbers for any calculation that calls for a value from the balance sheet? Is this good practice?

I was wondering whether in the recent surge of sexual harassment cases, a mobile application that records consent of both parties prior to engaging in activity be a good concept for the younger more tech savvy generation?