Musings on Markets

AUGUST 19, 2024

In fact, the business life cycle has become an integral part of the corporate finance, valuation and investing classes that I teach, and in many of the posts that I have written on this blog. In 2022, I decided that I had hit critical mass, in terms of corporate life cycle content, and that the material could be organized as a book.

Corporate Finance 121

Corporate Finance Valuation Investments Finance 121

Musings on Markets

FEBRUARY 12, 2025

I am in the third week of the corporate finance class that I teach at NYU Stern, and my students have been lulled into a false sense of complacency about what's coming, since I have not used a single metric or number in my class yet. Data Update 4 for 2025: Interest Rates, Inflation and Central Banks!

Hurdle Rate 72

Hurdle Rate Accounting Investments Economics 72

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 80

Hurdle Rate Profit and Loss Accounting Investments 80

CFO News Room

JANUARY 18, 2023

In my last post, I noted the decline in costs of capital for firms over time, noting that the median cost of capital at the start of 2022 is only 6.33%, across global firms, and argued that companies that demand double-digit hurdle rates risk being shut out of investments.

Marketing 130

Marketing Hurdle Rate Investments Accounting 130

Musings on Markets

FEBRUARY 27, 2022

In my last post, I noted the decline in costs of capital for firms over time, noting that the median cost of capital at the start of 2022 is only 6.33%, across global firms, and argued that companies that demand double-digit hurdle rates risk being shut out of investments.

Hurdle Rate 99

Hurdle Rate Investments Accounting Entertainment 99

Musings on Markets

JANUARY 5, 2024

In January 1993, I was valuing a retail company, and I found myself wondering what a reasonable margin was for a firm operating in the retail business. In my corporate finance class, I describe all decisions that companies make as falling into one of three buckets – investing decisions, financing decision and dividend decisions.

Valuation 105

Valuation Financial Analysis Analyzing Data Profit and Loss 105

Musings on Markets

JULY 24, 2024

Thus, if a country derives 50% of its economic output from iron ore, a drop in the price of iron ore will cause pain not only for mining companies but also for retailers, restaurants and consumer product companies in the country.

Hurdle Rate 75

Hurdle Rate Currencies Valuation Economics 75