Damodaran on Valuation_ Security Analysis for Investment and Corporate Finance ( PDFDrive )
flows could have been defined before corporate taxes, in which case the discount rate used should have been a precorporate tax d ...
requiredtovaluefirmsallthroughtheyear.Consequently,the lastannualreportthatisavailableforafirmbeingvaluedcan containinformationt ...
using numbers from the last financial year will lead to undervaluing them. Even for those firms that are not are changing substa ...
The trailing 12-month revenues are more than twice the revenuesreportedinthelatest10-K,andthefirm’soperating loss and net loss h ...
forfinancialexpensessuchasoperatingleasesexpensesthat are treated as operating expenses. This affects the measurement of operati ...
Research expenses, notwithstanding the uncertainty about futurebenefits,shouldbecapitalized.Tocapitalizeandvalue researchassets, ...
year’s entire R&D expense to arrive at the value of the researchasset.Thisaugmentsthevalueoftheassetsofthe firm and, by exte ...
expensewas$3,320million.Weassumedanamortizablelife offiveyearsforitsresearchefforts,someofwhicharebasic and some of which are di ...
Note that none of thecurrent year’s expenditurehas been amortizedbecauseitisassumed tooccurattheend ofthe year,butthatalloftheex ...
Boththebookvalueofequityandcapitalareaugmentedby thevalueoftheresearchasset.Sincemeasuresofreturnon capitaland equityarebased on ...
otheroperatingexpensesthatarguablyshouldbe treatedas capital expenses. Consumer product companies such as Gillette and Coca-Cola ...
Determinetheperiodoverwhich thebenefitsfrom the operating expense (such as SG&A) will flow. Estimatethevalueoftheasset(simi ...
If we assume that the depreciation on the leased asset approximatestheprincipalportionofthedebtbeingrepaid, theadjustedoperating ...
Targethasapretaxcostofdebtof5.50%.To computethe present value of the commitments, we have to make a judgmentonthelumpsumcommitme ...
ToadjusttheoperatingincomeforTarget,wefirstusethefull adjustment.Tocomputedepreciationontheleasedasset,we assume straight-line d ...
earningsin 39 ofthe 40 quartersduringthedecadeandIntel postedarecordalmostasimpressive.Othertechnologyfirms followedin theirfoot ...
instance,onApril10,1997,Intelreportedearningsof$2.10 pershare, higherthananalystestimatesof$2.06pershare, butsawitsstockpricedro ...
Techniques for Managing Earnings Howdofirmsmanageearnings?Oneaspectofgoodearnings managementisthecareandnurturingofanalystexpect ...
to large deals announced just days before each quarter ended. In a moreelaborate variant of this strategy,twotechnologyfirms,bot ...
and Lev (1999) studied 389 firms that wrote off in-process R&D between 1990 and 1996; 11 these writeoffs amounted, on averag ...
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