In fact. I did not make this decision abruptly or idly and I did consider two options: (a) put a stop loss and (b) put put options. Analyze average rating, monitor reviews, reply to reviews, and gain product insights from user feedback in one workspace. In this post, I look back at markets over the period, a testing period for … A Skeptical Look at ESG. ‎Aswath Damodaran, a professor of finance at NYU Stern, joins Scott to discuss the news surrounding GameStop and the short squeeze. Each view shows the latest 20 blog posts, to read older, press the "Load more" button on the bottom. Thank you for this post. Ally Mahmoud(D’20), a Computer Science major from Dartmouth College, provided outstanding software development services. Ally Mahmoud(D’20), a Computer Science major from Dartmouth College, provided outstanding software development services. As a counter to the market's excitement, I decided to compare the narrative (and value) that I had for Alphabet in November 2015 (after their last earnings report) to the narrative (and value) after this one (in February 2016). I have taken my share of punishment on investments that have not gone well, with Valeant being a source of continuing pain (which I will return to after its next earnings report). Gross Income Based: Net Income Based : Industry Name: Number of firms: Gross Margin: Net Margin: Pre-tax, Pre-stock compensation Operating Margin It is so easy, in the moment, to find fault, as many have, with these superstars and miss how special they are. Apple still represents a reasonable investment opportunity even as it's market cap charges toward $1 trillion, according to Wall Street "Dean of Valuation" Aswath Damodaran. I think advertising has been a very consistent 1.5% of GDP for a very long time, and while there has been a huge turnover from TV to online, I don't think that overall number is growing. Using the process that I describe, perhaps in too much detail. Cancel. The problem is that is has no track record so far of doing so.2. ~200 soldiers stole a mine that is still producing silver.A less moral one (when we forget where Apple gets Colgan from), but Apple is not the cash machine the conquering of the Inca's was. Industry Name: Number of firms: Beta : D/E Ratio: Effective Tax rate: Unlevered beta: Cash/Firm value: Unlevered beta corrected for cash: HiLo Risk: Standard deviation of equity I teach corporate finance, valuation and investment philosophies at the Stern School of Business at New York University. I see aapl as essentially a market owner on top of all else - the iphone, watch etc. What's Lyft really worth? My not-so-profound thoughts about valuation, corporate finance and the news of the day! My not-so-profound thoughts about valuation, corporate finance and the news of the day! I know that one reason for Google's restructuring/renaming exercise last year was an ostensible desire to improve transparency, but I think that there may be less here than promised, at least at the moment. Aswath Damodaran. Professor,Firstly, I would like to say thank you x 100 for all the work you do. Aswath Damodaran. By Aswath Damodaran, Kerschner Family Chair in Finance Education If you have been an Apple stockholder last year, you probably feel like you have been on a roller coaster. As you point out, Apple is a tremendous company, but you must value you it with a rational perspective as to its value growth duration. Aswath Damodaran - Aug 21, 2020, 12:18 pm. Local Nav Open Menu Local Nav Close Menu. Blog; TFP profile; Contact; Search for: Aswath Damodaran. That said, it is worth emphasizing how much Apple is on the iPhone roller coaster ride, reporting better earnings in the quarters immediately after a new iPhone is released and much worse earnings in the quarters thereafter. Sounding good or Doing good? Local Nav Open Menu Local Nav Close Menu. Author: Tan KW | Publish date: Fri, 5 Jun 2020, 10:30 AM . By Aswath Damodaran, Kerschner Family Chair in Finance Education If you have been an Apple stockholder last year, you probably feel like you have been on a roller coaster. 2.0 • 2 Ratings; $74.99; $74.99; Publisher Description. Having valued Apple multiple times on this blog over the last five years, and bought and sold the stock based on those valuations, the most recent earnings report is an opportune time for me to revisit Apple’s value. Once you have a story for a company and convert that story into valuation inputs, the rest of the process becomes just mechanics. This conversation couldn’t be more timely given all the hoopla around Gamestop and the like. Apple stock represents a value play and is worth much more than $450 per share, New York University finance professor and valuation expert Aswath Damodaran says. 6 Misconceptions about Valuation ¨ Myth 1: A valuation is an objective search for “true”value ¤ Truth 1.1: All valuations are biased. -- Michael J. Mauboussin, Chief Investment Strategist, Legg Mason Capital Management an… Corporation and the Value/Price Game (Later this year), Taming the Market? Amazon, Facebook, LinkedIn (msft), are similar in that way, and I think there are some network effects that may be obvious with a company like facebook but be underappreciated related to aapl. In a recent interview with CNBC, NYU Stern School of Business professor Aswath Damodaran discussed the new highs made in stocks like Apple (NASDAQ:AAPL) and … As AAPL is looking to pass the $140 mark sometime this week - I want to ask you if you are firm in your valuation and will sell as you said you would. I have enjoyed reading your books and website info since 2008. My data updates usually look at the data for the most recent year and what I learn from them, but 2020 also marks the end of a decade. I feel like I can never be sure exactly what a company is worth but I like guessing and trying to make money. Aswath Damodaran, finance professor and experienced investor, argues that the power of story drives corporate value, adding substance to numbers and persuading even cautious investors to take risks. Prior Blog Posts on Apple. I teach corporate finance, valuation and investment philosophies at the Stern School of Business at New York University. With time, the number of spreadsheets on this page has also increased. If having a cash spigot that never turns off is a problem, Apple has it, but I am sure that it will not get about as much sympathy from the rest of the world as a supermodel who complains that she cannot put on weight, no matter how much she eats. The, The quality of an investment does not always correlate with its quality as a business, with the price driving the divergence. Apple: The Greatest Cash Machine in History? A Skeptical Look at ESG. Data Update 1 for 2021: A (Data) Look Back at a Most Forgettable Year (2020)! Data Update 2 for 2021: The Price of Risk! The GoPro and LinkedIn Question! By Mohammed Abrar Asif / November 26, 2020 November 27, 2020. Bringing Professor Damodaran Teaching, Writing, Data and Spreadsheet resources at your fingertips. This is the essence of an investment philosophy. Having valued Apple multiple times on this blog over the last five years, and bought and sold the stock based on those valuations, the most recent earnings report is an opportune time for me to revisit Apple’s value. ‎"Aswath Damodaran is simply the best valuation teacher around. ‎Preview and download books by Aswath Damodaran, including Investment Valuation, Investment Valuation and many more. Sounding good or Doing good? The Sharing Economy come home: The IPO of Airbnb! Markets were impressed by both the revenue and earnings numbers and the stock price increased by 8% in the immediate aftermath, briefly leading Alphabet to the front of the market cap race. Or is the ability to ignore issuing earnings guidance a luxury reserved for the mega-caps or for companies in which investors place a large amount of confidence? Data Update 3 for 2021: Currencies, Commodities, Collectibles and Cryptos. Another enjoyable and highly useful valuation analysis where both the conclusions and methodology are of high interest. I have a query on your Options calculation in the Apple spreadsheet. Aswath Damodaran says Apple shares are trading at an attractive valuation on CNBC's "Squawk Alley" Monday. Marking Time: A new year, a fresh semester and its class time! Why not use the Sales-to-Capital Ratio to project the Reinvestment needs for the Terminal Period as well?Indeed, if I use the 'Revenue Growth/ROIC*EBIT(1-t)' formula, the Reinvestment need in the Terminal Period eats up a lot of value and looks out of line with prior Reinvestment needs. Tesla has a long way to go before it justifies its current stock price, New York University finance professor Aswath Damodaran told CNBC on Thursday.. Damodaran, known as … What is a hurdle rate for a business? The GoPro and Li... Management Matters: Facebook and Twitter! I did not see anything in your narrative that would explain why this cost of capital setting was changed.In the sheet Input, cell B38, is the assumption/setting I am referring to. Rich Fagan. To evaluate whether the earnings report merited the negative market reaction, I went back to the intrinsic value drawing board and updated my valuation of Apple, the last of which. Here we have no price or anchoring bias. Search apple.com. Note that while Apple took a while to start returning cash, and it needed prompting from David Einhorn and Carl Icahn, it not only initiated dividends in 2012 but has supplemented those dividends with stock buybacks of increasing magnitude each year. Blog Index : Data Update 2 for 2020: Retrospective on a Disruptive Decade - Aswath Damodaran . 0 . It contained a modicum of good news, insofar as there was growth in revenues as opposed to the decline posted in the prior quarter and still-solid profit margins, but the revenue growth was only 3% and the margins are still lower than they used to be. My blog posts can be found here. Home Stocks Aswath Damodaran Analysis: The Strong (FANGAM) Get Stronger! Some of you may find my story too cramped , seeing a greater possibility than I do of Apple breaking through into a new, big market (with Apple Pay or the Apple iCar). Last week, was my data week, wh... What is a hurdle rate for a business? As in the Jobs era Apple it seems less of a company than a cult. Professor : I´ve been a reader of yours for many years ! To learn more about valuation, you can visit Professor Aswath Damodaran Blog here. Published on May 23, 2016 . I can't seem to align your numbers to those in the 10-k (page 64). Does the exchange rate makeup for the interest rate arbitrage opportunity. To judge which is the better company, though, you would have to specify on what dimension you are making the comparison, i.e., as a business, an investment or as a trade. That was the same reaction that I had as I watched another earnings report from Apple and the usual mix of reactions to it, some ho hum that the company made. Analysts projected that Nokia would maintain market dominance for many years to come...until both Apple changed the model and low cost producers made feature phones of similar quality as Nokia. Apple; Mac; iPad; iPhone; Watch; TV; Music; Support; Shopping Bag + Cancel Apple Books Preview. Data Update 4 for 2021: The Hurdle Rate Question! Top Books Top Audiobooks Oprah’s Book Club Investment Valuation Tools and Techniques for Determining the Value of Any Asset. My twitter feeds (almost entirely on valuation/corporate finance) can be found at @Aswath Damodaran. Local Nav Open Menu Local Nav Close Menu. I would hasten to add that I have never owned Google, as an investor, and that may reflect the fact that I continually under estimate the profit-making power of its online advertising engine. Apple; Shopping Bag + Search apple.com. Follow him on Twitter, @AswathDamodaran. How can they run the company with Cost of Sales > Revenue. (Not even considering SGA, Staff, R&D etc.) Some food for thought :Let's assume that today search is all about Google, followed by Bing (Microsoft).Let's then assume that in the not too distant future, advances in machine learning allow search to move to voice through the likes of Siri (Apple), Cortana (Microsoft), Google Now (Google), M (Facebook) and that search is no longer visual or at least significantly less visual.Let's assume that Google makes the majority of its revenue of Google sites (ex YouTube as this stays in tact)Based on the assumptions above, the Bets need to be paying off and rather quickly as a user interface change will challenge Google's dominance and it will be mega caps doing the challenging.My own assumption is that this future is +- 2-5 years away. Regular Classes. As far as I get it, it is annualised (power of (1/0.25)). Wednesday, June 3, 2015 . The Storming of the Bastille: The Reddit Crowd targets the Hedge Funds! Your outstanding Options' value seems much lower than the company's estimate (are we talking about the same items as the company is calling them Restricted Stock Units).