Equity Instruments: Newsletter – October 20,
2012
Where we
are in classÉ
Where you
should be in the projectÉ
Data NotesÉ
We will be beginning with the multiples section a week from Monday. You can look up many of the most widely used multiples for your firm by going to Yahoo! Finance and entering the symbol for your firm. You can also screen stocks for specific multiples by going to
You can also look at the excel spreadsheets containing the valuations of the companies that we analyze in class by going to company valuations on the web site for the classÉ Play with the spreadsheets and get a sense of what drives value with each company.
Miscellaneous FAQs
How
do I know whether my value is right?
I am afraid I do not know the answer to the question. No one knows what the true value of a stock is. Suffice to say, your estimate of value is as good as any other.
How
often do I need to update this valuation?
Constantly. New information about your firm and the economy will change your valuation. You need to keep track of the value changes.
Do
I need to build my own spreadsheets or can I use one of the spreadsheets on the
web?
Building your own spreadsheet is a great way to learn valuation but work within your time constraints. You can use one of my spreadsheets or adapt it to meet your needs.
What
do I need to turn in?
You need to turn in the assumptions that underlie your value, the stock price on the day of the valuation and the details of the cash flows. You can do it electronically as an attachment to an email, if you want. There is no need for purple prose.