Musings on Markets

FEBRUARY 27, 2023

In this section, I will lay out a mechanism for evaluating the effects of borrowing on the cost of funding a business, i.e., the cost of capital, and talk about why firms may under or overshoot this optimal. To the retort from some bankers that you can liquidate the assets and recover your loans, I have two responses.

Equity 52

Equity EBITDA Start-ups Net Debt 52

Musings on Markets

JANUARY 5, 2024

Since I am lucky enough to have access to databases that carry data on all publicly traded stocks, I choose all publicly traded companies, with a market price that exceeds zero, as my universe, for computing all statistics. Beta & Risk 1. Equity Risk Premiums 2. Return on (invested) capital 2. Debt Details 1.

Dividends 98

Dividends Risk Premium Equity Book Value 98

Musings on Markets

JANUARY 6, 2023

Thus, without a sense of what comprises a high or low profit margin for a firm, or what the cost of capital is for the typical company, it is easy to create "fairy tale" valuations and analyses. Data universe : In my sample, I include all publicly traded firms with market capitalizations that exceed zero, traded anywhere in the world.

Risk Premium 52

Risk Premium Dividends EBITDA Start-ups 52