Even if you take the ARK bear case as realistic, with Tesla projected to sell 1.7 million cars in 2023 and earn operating margins close to the auto sector, the pricing per share that you get will be closer to $250/share, with a more realistic share count and time value adjustments, not the $560 that you see on the ARK spreadsheet. The market momentum has clearly shifted against Tesla, and all the news about the company seems to skew "bad", it is worth noting that there are good things that have happened at the company over the last year: In short, the operating base on which I will be building my Tesla valuation in June 2019 will be a more solid one than the one that I was using in 2018. You are in. Over the last eight months, I have written a series of posts on the market and how it has adapted and adjusted to COVID. This site uses cookies and other tracking technologies to assist with navigation and your ability to provide feedback, His YouTube videos on subjects such as “Equity Risk Premiums”, enjoy 165,000+ subscribers. Tesla's bonds are yielding 9% but the cost of capital is extremely low at 8%. My twitter feeds (almost entirely on valuation/corporate finance) can be found at @Aswath Damodaran. Thanks. At the time Acuity went to print, Damodaran was up to his tenth viral market update, and counting. by Aswath Damodaran Lay out the basis for the option premium and look at the conditions that have to be met for option pricing models to be useful in valuing an asset. But I just got lucky.”. Borrowing a movie title to categorize what's happened to the company in the last year, I would break the news down into the good, the bad and what I can only term as gobsmacking, where you whack your head and say "what the heck was that?". The refreshingly frank, often outspoken Professor of Finance at New York University’s Stern School of Business lives by a simple rule: Never go anywhere you need to be invited back. Datasets. Subscribe to: Post Comments (Atom) Twitter. Please enable JavaScript in order to get the best experience when using this site. That’s the one thing I’ve always had to offer. Aswath Damodaran looks at a range of these companies, from start-ups in new businesses to distressed companies, from banks facing regulatory turmoil to commodity firms, and from emerging market upstarts to multinationals that spread across geographies and businesses. It would take about 40 hours to watch the whole semester, but it seems like a really good resource. (. Posted by Aswath Damodaran at 3:44 PM. If it feels like you are reading last year’s business stories in today's paper, there is a simple reason. YouTube Video--> Posted by Aswath Damodaran at 3:53 PM. One is that Tesla has been an expensive target, especially when its market capitalization exceeded $50 billion. We know that:- Tesla has been cutting prices- EV subsisides in the US are being phased out- Tesla's product mix is changing to a cheaper one (they pushed forward the deamand for more expensive versions)- competition is coming.also, 10% operating margin feels like a stretch given (i) the history of operating inefficients, (ii) decreasing prices, (iii) that warranty is likely underreserved. I may not have the power to change the status quo in any of these businesses, but I can stir the pot…”, Take his damning assessment of fair value accounting. (“A complete fiction.”). B40.3331" Aswath Damodaran" Aswath Damodaran! The class webcasts are on YouTube and you will need to be online, to watch them. Aswath Damodaran (born 23 September 1957), is a Professor of Finance at the Stern School of Business at New York University (Kerschner Family Chair in Finance Education), where he teaches corporate finance and equity valuation.. He’s so passionate about education that all of his teaching – his classes, seminars, executive classes, online classes, data sets, tools, spreadsheets and more – are freely available on his website. I think Tesla mistook the Model 3 back-log demand for a steady-state demand. I remain skeptical on the odds of an acquisition, precisely because I don't see Musk going quietly into the night, but adding an acquisition floor at a $15 billion value for equity (about $60/share) increases the simulated value for the stock by about $10/share. Over decades he has created and helped shaped the field of valuation. To provide perspective on why the value per share today is higher, even with a much greater chance of failure, I compared the numbers that I used in my valuation in June 2018 to June 2019: Note that while my end game on revenues ($100 billion by 2028) and operating margins (10% in 5 years) has not changed, the base numbers make both easier reaches. “I have absolutely no qualms in telling people what’s on my mind,” Damodaran says. A couple of thoughts. You basically have to accept it is a process. Professor Damodaran, Your paper on ESG offers a very timely debate on how the world of ESG investing has evolved so far over the past 5-7 years. “There’s no point valuing a company in 1988. 10! “Make students understand why this matters to them, and then they will learn how to use it. What middle-market businesses really need from Josh Frydenberg, The Dark Side of Valuation: Valuing young, distressed, and complex businesses, Management Accounting and Corporate Finance. When you say buy shares, do you have a percentage amount you allocate to your portfolio or does it depend by name? The company's debt overhang, already a concern a year ago, has become a clear and present danger to the company. Teoria i praktyka Aswath Damodaran już od 167,64 zł - od 167,64 zł, porównanie cen w 13 sklepach. My name is Aswath Damodaran, and I teach corporate finance and valuation at the Stern School of Business at New York University. I intend to have online versions of all three courses here, as well as other finance-related videos. “I started my MBA wanting to be a merchant banker but along the way I had a moment of grace,” he says. “I remember walking into the first class I ever TA’d, and I knew it was what I wanted to do with the rest of my life,” he says. Aswath Damodaran Aswath Damodaran 1. Aswath Damodaran 2 Discounted Cashflow Valuation: Basis for Approach n where CF t is the cash flow in period t, and r is the discount rate appropriate given the riskiness of the cash flow and t is the life of the asset. Hopefully this is one of those times, as I like the company and the product and I always welcome good jobs in the US. Aswath Damodaran finds himself is one of the most sought-after experts in valuation. 10! YouTube Video. All of these words, and all of it is on your assumption that Tesla's best days are behind them? "Aswath Damodaran is simply the best valuation teacher around. Prof. Damodaran is a household name among anyone who has studied finance over the past two decades. Please. Today, Damodaran holds the Kerschner Family Chair in Finance Education at Stern. Aswath Damodaran Aug 1, 2017, 11:48 pm When it comes to any finance-related questions, I am fair game, and those questions usually span the spectrum, from what I think about Warren Buffett (or why I don’t agree with everything he says) to whether tech stocks are in a … I am a teacher first, who also happens to love untangling the puzzles of corporate finance and valuation, and writing about my experiences. A few weeks ago, I got an email asking a very simple question: How do you estimate the "intrinsic" value of gold? Proposition 1: For an asset to have value, the expected cash flows have to be positive some time over the life of the asset. Value Investing II: Tough times for Value Investing - Passing Phase or a Changed World? Great article. Aswath Damodaran is not trying to win any popularity contests. While there are some entanglements (such as the one with Panasonic in the battery factories) that will have to be worked out, there have generally been two impediments on this path. YouTube Video. A Viral Market Update XIV: A Wrap on the COVID market, premature or not! “I was able to say this because I really don’t care whether McKinsey invite me back again. Be willing to say you were wrong, and willing to correct yourself when wrong. I’ve learned things I didn’t know about valuation in just the past nine days. No comments: Post a Comment. So what’s his secret to being an award-winning educator? One way or another, I’m gonna get you!” he says, laughing. Market data (November 1, 2020) Regional breakdown - Market Changes (November 1, 2020) ... Aswath Damodaran I am a Professor of Finance at the Stern School of Business at NYU. Why did you buy at close to fair value? Sovereign&DefaultSpreads:&Two&paths&to&the& same&des=naon…& Aswath Damodaran! Over the years I have observed that I am wrong a lot. Excerpt from WIRED-- "Aswath Damodaran, a professor of finance at the Stern School of Business at New York University and an expert in market valuations, says that Tesla's rise in the last six months can largely be attributed to one single thing: Musk has … In it, Damodaran writes: “…the dark side of valuation beckons any time analysts have trouble fitting companies into traditional models and metrics…”. 9! When the stock is traded and markets are viewed … 2! In this simulation, I have assumed that Tesla will remain a stand alone, going concern, and that the equity value could drop to zero, if there is a shock to the value of operating assets, given the debt load. Aaa 0 Aa1& 25 Aa2& 50 Aa3& 70 A1 85 A2 100 A3 115 Baa1& 150 Baa2& 175 Baa3& 200 Ba1& 240 Ba2& 275 Ba3& 325 B1 400 B2 500 B3 600
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