The discounted cash flow model is the most advocated model for valuing a stock. Under this model, an analyst will estimate the future cash flows for the company, and discount it with the appropriate discount rate. Traditionally, analysts have used dividends as the proxy for cash flows, hence the dividend discount model. However, the problem

# valuation

## How to Calculate FCFF and FCFE

To value a company, one of the most popular methods is to use the discounted cash flow method. Traditionally, the dividends paid by the company are used as a proxy for the cash flows of the business. However, the dividends do not truly reflect the amount of cash flow the business can generate for its

## Valuation Lecture 21: Real Options – The Option to Delay

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: The Black-Scholes Model Choice of Option Pricing Model Options in Projects/Investments/Acquisitions The Option to Delay Valuing a patent The Optimal Time to Exercise Valuing Natural Resource Companies Valuing Undeveloped Reserves The class is currently being taught

## Corporate Finance Lecture 25: Valuation (Continued)

This video is a part of online course on Corporate Finance by Professor Aswath Damodaran of NYU. This video discusses: Estimating Growth in EBIT Getting to Stable Growth Estimating terminal value From operating asset to equity value Value and Corporate Finance

## Corporate Finance Lecture 24: Valuation and Estimating Inputs

This video is a part of online course on Corporate Finance by Professor Aswath Damodaran of NYU. This video discusses: More on Dividends Valuation Three approaches to valuation DFC valuation Equity versus firm valuation Estimating cash flows Estimating discount rates Estimating growth rates

## Valuation Lecture 18: Finding Comparables

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: Techniques for Comparing Across Firms PE, Growth and Risk Small vs. large companies Relative Valuation Across the Entire Market Controlling for differences across companies Marketing regressions Valuation of the week: Danone The class is currently being

## Valuation Lecture 17: Analyzing Multiples

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: Is low (high) PE cheap (expensive)? PEG Ratio Price to Book Value Ratio EV multiples Finding a “cheap” stock Value of brand name The class is currently being taught by Prof. Aswath Damodaran at the NYU’s

## Valuation Lecture 16: Relative Valuation

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: Essence of relative valuation Relative valuation is pervasive Why relative valuation? Deconstructing Multiples Multiple: Price Earnings Ratio Multiple: Enterprise Value/EBITDA Multiple Multiple: price to Book value ratio The class is currently being taught by Prof. Aswath

## Valuation Lecture 14: Advanced Valuation

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: Valuing cyclical and commodity companies Valuation Lessons Valuing Vs. Pricing Three views of “the gap” Option 1: Margin of Safety Option 2: Collect more information Option 3: Build what-if analyses Option 4: Confront uncertainty Strategies for

## Valuation Lecture 13: DFC Valuation Tests

This video is a part of online course on Valuation by Professor Aswath Damodaran of NYU. This lecture discusses: A corporate governance discount The R&D effect The distress factor Lesson: Increasing growth is not always a value creating option Lesson: Financial leverage is a double-edged sword Dealing with decline and distress Adjusting the value of