Musings on Markets

JANUARY 9, 2021

The second was that, starting mid-year in 2020, equity markets and the real economy moved in different directions, with the former rising on the expectations a post-virus future, and the latter languishing, as most of the world continued to operate with significant constraints.

Risk Premium 52

Risk Premium Market Capitalization Equity Start-ups 52

Musings on Markets

JANUARY 17, 2024

Heading into 2023, US equities looked like they were heading into a sea of troubles, with inflation out of control and a recession on the horizon. Breaking equities down by sub-region, and looking across the globe, I computed the change in aggregate market capitalization, by region: While US stocks accounted for about $9.5

Risk Premium 77

Risk Premium Start-ups Equity Treasury 77

Musings on Markets

FEBRUARY 27, 2023

To fund the business, you can either use borrowed money (debt) or owner's funds (equity), and while both are sources of capital, they represent different claims on the business. Even government-owned businesses fall under its umbrella, with the key difference being that equity is provided by the taxpayers.

Equity 52

Equity EBITDA Start-ups Net Debt 52

Musings on Markets

JULY 17, 2023

In my second data update post from the start of this year , I looked at US equities in 2022, with the S&P 500 down almost 20% during the year and the NASDAQ, overweighted in technology, feeling even more pain, down about a third, during the year. US Equities in 2023: Into the Weeds! that was lost last year.

Marketability 95

Marketability Risk Premium Start-ups Treasury 95

Musings on Markets

NOVEMBER 9, 2021

I would be lying if I said that I have had clarity about Tesla's story over the last decade, because it has so many tangents, distractions and shifts along the way, flirting with narratives about being a battery company, an energy company and a technology company. for mature markets. What’s your story?

Start-ups 99

Start-ups Dividends Marketability Market Capitalization 99

Musings on Markets

FEBRUARY 8, 2022

Relative Risk Measures Before we embark on how to measure relative risk, where there can be substantial disagreement, let me start with a statement on which there should be agreement. Technology and cyclical companies dominate raw highest risk rankings.

Risk Premium 67

Risk Premium Beta Start-ups Equity 67

Equilest

JUNE 10, 2023

Changes in tax regulations, technology advancements, and shifts in customer preferences can impact the future prospects and growth potential of the business. Technology and Infrastructure In today's digital age, the technology and infrastructure employed by a tax preparation business can greatly influence its value.

Business Valuation 40

Business Valuation Fair Market Value Marketability Technology 40

Equilest

JUNE 13, 2023

Equipment, Technology, and Infrastructure The quality and condition of equipment, technology, and infrastructure directly influence the value of a disaster restoration business. Stay updated on the latest advancements, changes in regulations, and emerging technologies that can impact the business's value.

Business Valuation 52

Business Valuation Asset-based Approach Appraisal Intangible Assets 52

Musings on Markets

JANUARY 6, 2023

When valuing or analyzing a company, I find myself looking for and using macro data (risk premiums, default spreads, tax rates) and industry-level data on profitability, risk and leverage. I do report on a few market-wide data items especially on risk premiums for both equity and debt. Cost of Equity 1.

Risk Premium 52

Risk Premium Dividends EBITDA Start-ups 52

Musings on Markets

JANUARY 31, 2024

In my last three posts, I looked at the macro (equity risk premiums, default spreads, risk free rates) and micro (company risk measures) that feed into the expected returns we demand on investments, and argued that these expected returns become hurdle rates for businesses, in the form of costs of equity and capital.

Equity 79

Equity Book Value Start-ups Corporate Finance 79

Musings on Markets

JANUARY 27, 2021

In my last post , I described the wild ride that the price of risk took in 2020, with equity risk premiums and default spreads initially sky rocketing, as the virus led to global economic shutdowns, and then just as abruptly dropping back to pre-crisis levels over the course of the year.

Start-ups 52

Start-ups Marketability Equity Treasury 52

Musings on Markets

JANUARY 12, 2021

The last decade, with it influx of user based companies and technology platforms forced me to think seriously about how to value a user, subscriber or rider and extrapolate from there to company value. Discount rates in intrinsic valaution have to change to reflect current market conditions, and can be expected to change over time.

Corporate Finance 52

Corporate Finance Start-ups Finance Marketability 52

Musings on Markets

MAY 24, 2021

Looking at US equities, the S&P 500 is up about 11% and the NASDAQ about 5%, from start of the year levels, and the underperformance of the latter has led to a wave of stories about whether this is start of the long awaited comeback of value stocks, after a decade of lagging growth stocks.

Treasury 55

Treasury Start-ups Risk Premium Price to Book 55

Musings on Markets

JANUARY 26, 2023

In its early years, Tesla was dependent on equity issuances for funding growth investments, and its liberal use of options to reward management (and especially Elon Musk) opened it up to criticism. The Market : The US equity market in January 2023 looks very different from the market at the start of 2022. per share in 2022.

Start-ups 80

Start-ups Marketability Risk Premium Equity 80

Appraisal Rights

JUNE 5, 2017

The various problems facing the company led the court to embrace the respondents’ theory that SWS would continue to face an uphill climb given its relatively small size, which prevented it from scaling its substantial regulatory, technological, and back-office costs. Hilltop’s Influence on the Sale Process Rendered Merger Price Unreliable.

Beta 40

Beta Risk Premium Capital Structure Discounted Cash Flow 40

Musings on Markets

JULY 22, 2021

Uber's ownership in Zomato is a result of Zomato's acquisition of Uber Eats India, where Uber received a share of Zomato's equity in exchange. That said, reinvestment takes a different form for companies like Zomato, with investments in technology and in acquisitions, driving future growth.

Marketability 86

Marketability Start-ups Equity Price to Book 86