Damodaran on Valuation_ Security Analysis for Investment and Corporate Finance ( PDFDrive )
powerful and versatile way of controlling for differences acrosscompanies.Notonlycantherebeasmanyindependent variables as the da ...
The enterprise value-to-EBITDA multiples vary widely acrossthesefirms,andmanyofthesefirmshavenegativenet capitalexpenditures,par ...
At 5.6 times EBITDA, the firm is overvalued. ILLUSTRATION 9.4: Comparing EV/Capital Ratios Inthelastcolumn,wereporttheafter-taxr ...
value-to-salesratioof2.10whileearningareturnoncapital of 15.63%. By the same token, L’Oreal and Wella look overvalued,sincetheyt ...
Asafinaltest,weregresstheenterprisevalue-to-capitalratio against the after-tax operating margin to complete the analysis: In thi ...
Basedonthesepredictions,Sarantisisundervaluedbyabout 55%(withanEV/capitalratioof2.22)andChristianDiorby about 43% (with an EV/ca ...
Foramorecompleteexaminationoftherelationshipbetween EV-to-sales ratios and after-tax operating margins, we regressed theformerag ...
Yule Catto carries more debt thanthe typical firm in the sector with an interest coverage ratio of 2.12, and after adjustingfort ...
TurningtoEV/EBITDAmultiples,weobtainthefollowing outputfromtheregressionagainstthetaxrate,reinvestment rate,returnoncapital,ande ...
The regression yields results similar to those obtained for price-to-bookratios,andtheR-squarediscomparableat57.3 percent. The r ...
over the next five years was a consensus estimate from analysts,andthereinvestmentratewasalsocomputedusing numbersfromthemostrec ...
Itisalsoeasiertoestimatemultiplesofrevenuesafter growth rates have leveled off and the firm’s risk profileisstable.Forbothyoung ...
Inthethirdapproach,we canadjustthemultiple offuture revenuesfordifferencesinoperatingmargin,growth,andrisk between thefirm being ...
Useexpectedvalues.Thefuturerevenuesorearnings usedinthevaluationshouldbeexpectedvaluesand not best-case estimates. With both di ...
Enterprise value multiples look at market value of the operatingassetsofthefirmandnotjusttheequityinvestedin them.Thus,theyprovi ...
PART THREE Loose Ends in Valuation Thereliefwefeeloncewehavevaluedtheoperatingassetsof a firmshouldbe short-lived. Itis in thisp ...
In Chapter 13, we deconstruct the control premium, often usedtojustifylargepremiumsinacquisitions,andarguethat thevalueofcontrol ...
CHAPTER 10 Cash, Cross Holdings, and Other Assets Mostfirms,privateandpublic,haveassetsontheirbooksthat canbe consideredto be no ...
cashandtheextentofsuchholdingsatcompanies.Wethen discussvariousapproachesusedtocategorizecashholdings andhowbesttodealwithcashho ...
Cash-oriented versus credit-oriented businesses. Firmsthatareincash-orientedbusinesses(fast-food restaurants,grocerystores)will ...
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