Musings on Markets

JANUARY 12, 2021

I also offer online classes in basic finance (present value, risk models and measures) and accounting (or at least my version of it) as background to my main classes. Discount rates in intrinsic valaution have to change to reflect current market conditions, and can be expected to change over time.

Valuation 52

Valuation Corporate Finance Finance Investments 52

Musings on Markets

JANUARY 31, 2024

In my last three posts, I looked at the macro (equity risk premiums, default spreads, risk free rates) and micro (company risk measures) that feed into the expected returns we demand on investments, and argued that these expected returns become hurdle rates for businesses, in the form of costs of equity and capital.

Hurdle Rate 78

Hurdle Rate Profit and Loss Accounting Investments 78

Barry Ritholtz

NOVEMBER 8, 2022

Railways were this revolutionary technology that was going to change the world, going to change civilization, the speed with which people — roughly at the same time, remember Mary Meeker of Morgan Stanley — RITHOLTZ: Sure. CHANCELLOR: Exactly. But also, you could see these parallels. The government debt relative to GDP came down.

Valuation 59

Valuation Finance Investments Banking 59

CFO News Room

JANUARY 7, 2023

Thus, market capitalization, interest rates and risk premiums, the data is as of that date. For accounting flow items , in income statements and statements of cash flows, such as revenues, earnings and expenses, I used the data in the most recent twelve months of reporting ; for most firms, that data is from October 2021 to September 2022.

Marketing 130

Marketing Valuation Corporate Finance Financial Analysis 130

Musings on Markets

JANUARY 6, 2023

Financing Flows Accounting Returns Dividends & Ownership Risk Premiums 1. Bond Default Spreads Growth Rates Accounting Clean up Tax Rates 1. Historical Growth Rate in Revenue/Earnings 1. Marginal tax rates, by country 2. Sustainable Growth Rate in Net Income & Operating Income 2.

Valuation 52

Valuation Corporate Finance Financial Analysis Leverage 52

Musings on Markets

FEBRUARY 27, 2023

Furthermore, do they optimize they debt ratios to deliver the lowest hurdle rates. Book versus Market : The book debt ratio is built around using the accounting measure of equity, usually shareholder's equity, as the value of equity. at least with technology companies). Do companies optimize financing mix?

Corporate Finance 52

Corporate Finance Finance Marketing Banking 52

Musings on Markets

JANUARY 9, 2021

Thus, an analyst who follows young technology companies may decide that paying ten times revenues for a company is a bargain, if all of the companies that he tracks trade at multiples greater than ten times revenues. If there is a hole in my sample, it is the absence of privately owned businesses.

Valuation 52

Valuation Currencies Numbers Corporate Finance 52

Musings on Markets

JANUARY 28, 2024

In particular, there are wide variations in how risk is measured, and once measured, across companies and countries, and those variations can lead to differences in expected returns and hurdle rates, central to both corporate finance and investing judgments. What's coming?

Hurdle Rate 97

Hurdle Rate Concentration Investments Finance 97

Barry Ritholtz

MAY 21, 2024

They were both steeped in technology. Unfortunately, nobody has the luxury of picking stocks for a 10 year period anymore, except for in, you know, our personal accounts. But now we’re back to a more normal hurdle rate. 5% interest rates is not super high. My parents were both in high tech. Absolutely.

Finance 59

Finance Marketing Numbers Investments 59

Barry Ritholtz

DECEMBER 26, 2023

Accounting was very difficult. It’s about a 50% fail rate, something like that. Technology, you know, the sector itself, the technology still has a stronger relative chart pattern. And technology and discretionary and comm services had a chance to rotate into a more bearish leadership position and did not do that.

Marketing 64

Marketing Leadership Finance Investments 64

Barry Ritholtz

NOVEMBER 25, 2024

You learn the technology. They did poorly while the money rolled into the big cap growth and, and technology media and telecom exploded. So you’ve got, you’ve got a modeling hurdle rate that you need to figure out when you’re adding diversifiers. And it took three months to get the account back.

Leverage 59

Leverage Investments Marketing Math 59