Lecture 1 - Introduction to Valuation

Class Introduction

Lecture 2 - Approaches to Valuation

Approaches to ValuationIntroduction to DCF valuationFirm vs Equity Valuation

Lecture 3 - Valuation Riskfree Rates

The Big Picture of ValuationRiskfree Rates- Necessary Ingredients- What if the government is not default free?

Lecture 4 - Equity Risk Premiums

Equity Risk Premiums- What are they?- Historical Risk Premiums- Country Risk Premiums- Company Exposure to Country Risk- Implied Equity Risk Premiums

Lecture 5 - Equity Risk Premia and Bond Default

Equity Risk Premia and Bond default spreadsEquity Risk Premia and Real Estate Cap RatesImplied premia for emerging marketsBetas- The problem with regression betas- Solutions

Lecture 6 - New ERP for September 2009

Updated ERP for September 2009The Cost of DebtWhy we use market value debt ratios.Cost of Capital - From one currency to another.

Lecture 7 - Hybrid Securities Measurings Earnings

Hybrid SecuritiesMeasuring Earnings- Updated values- Corrrecting for leases- Correcting for R&D

Lecture 8 - Accounting Fraud

Accounting fraud- Dealing with money losing companies- Tax rates- Cap Ex

Lecture 9 - Working Captial

Working Capital: Definition and ForecastingCash flow to Equity: Dividends, Earnings and FCFEExpected growth- The problems with historical growth- Analyst and Management forecasts of growth- Fundamental Growth

Lecture 10 - Fundamental Growth

Fundamental Growth- EPS versus Net Income- Organic vs Efficiency Growth-Operating Income Growth-Growth with money losing companiesTerminal Value-Why multiples don't work- Consistency rules (Growth rate, Length of growth, Excess Returns)

Lecture 11 - Terminal Value

Terminal value: Final thoughtsPicking the "right" DCF modelLoose ends in valuation- The value of cash- The value of cross holdings

Lecture 12 - Other Missed Assets

Other missed assets?The value of complexityDefining debt: Cost of capital versus Debt to net out...Equity Options

Lecture 13 - Valuation Examples

Valuation examples- Implied growth rate & Target prices- Financial service firms: pre and post crisis- Valuing the S&P 500- Negative FCFE and dilution effects

Lecture 14 - Valuing Corporate Governance Lambdas

Valuing Corporate GovernanceLambdas and valueThe Dark Side of Valuation- Valuing young companies

Lecture 15 - Valuing Companies with R&D

Valuing companies with R&DDealing with uncertainty in valuationValuing declining and distressed companiesMacro effects on valuationRelative Valuation- Introduction- Definition and Descriptive Tests

Lecture 16 - Analysis and Application of the PE Ratio

Analysis and Application TestsThe PE Ratio- Definiton- Descroption- Deternimnats

Lecture 17 - PE Ratios continued

More on PE ratios- Comparing PE ratios across markets- Comparing PE ratios across companies- Cross sectional regressionsPEG Ratios- Definition and Determinants

Lecture 18 - PEG Ratios

PEG Ratios- ApplicaitonsValue Multiples- EV/EBITDA and determinantsPrice to Book Ratios

Lecture 19 - Visualizing Cheap Companies

Visualizing cheap companies - PBV versus ROEEV to Book Capital RatiosFinding the companion variablePS and EV/Sales RatiosBrand Name Value

Lecture 20 - Option Pricing Redux

Option Pricing ReduxThe Option to Delay- Valuing Patents- Valuing undeveloped natural reserves

Lecture 21 - Valuing Equity as an Option

Final thoughts on valuing equity as an optionAcquirers' Anonymous: Seven Steps to Sobriety- Evidence on acquisitions- Acquisition tests

Lecture 22 - Acquisition Tests, Price v. Value

More acquisition testsPrice versus Value EnhancementPathways to Value EnhancementThe value of control

Lecture 23 - Closing Thoughts on Value Enhancement

Closing thoughts on Value EnhancementDante meets DCF: Ten Sins in ValuationProject Findings