Musings on Markets

AUGUST 5, 2023

If you have been reading my posts, you know that I have an obsession with equity risk premiums, which I believe lie at the center of almost every substantive debate in markets and investing. How, you may ask, can equity risk premiums be that divergent, and does that imply that anything goes?

Risk Premium 97

Risk Premium Equity Start-ups Treasury 97

Reynolds Holding

DECEMBER 5, 2022

In a new paper, we use agency theory to explore the effect of board independence on dividend policy. Dividends serve as a governance mechanism to mitigate agency conflicts, reducing free cash flows, which managers may exploit for personal gain rather than using them to maximize shareholder wealth.

Dividends 64

Dividends Marketability Equity 64

Brian DeChesare

MAY 3, 2023

When I started offering financial modeling training , I never expected to get questions about a methodology like the Dividend Discount Model (DDM). Otherwise, the written version follows: Why Use a Dividend Discount Model? The main argument in favor of the DDM is that it best represents what happens in real life when you buy a stock.

Dividends 64

Dividends Terminal Value Enterprise Value Equity 64

Harvard Corporate Governance

OCTOBER 27, 2023

Wang; and Share Repurchases, Equity Issuances, and the Optimal Design of Executive Pay (discussed on the Forum here ) by Jesse Fried. Related research from the Program on Corporate Governance includes Short-Termism and Capital Flows (discussed on the Forum here ) by Jesse Fried and Charles C.

Dividends 160

Dividends Finance Equity 160

Musings on Markets

JANUARY 21, 2023

In this post, I will begin by chronicling the damage done to equities during 2022, before putting the year in historical context, and then examine how developments during the year have affected expectations for the future. Actual Returns Your returns on equities come in one of two forms. Stocks: The What? at the start of that year.

Equity 93

Equity Risk Premium Start-ups Dividends 93

Financial Times M&A

JUNE 19, 2024

‘Dividend recapitalisations’ hit record rate as private equity owners take advantage of easy credit conditions

Dividends 105

Dividends Equity 105

Andrew Stolz

AUGUST 5, 2020

Definition of the Cost of Equity. The theoretical return the firm pays its equity investors (shareholders) is known as the cost of equity. In other words, the cost of equity is the rate of returns a firm pays to its shareholders. What Impacts the Cost of Equity? Dividend per share . Risk-free rate .

Equity 52

Equity Risk-free Rate Dividends Beta 52

Andrew Stolz

AUGUST 4, 2020

Definition of Equity Risk Premium. What Impacts the Equity Risk Premium? Dividends . How Do You Calculate Equity Risk Premium? Equity risk premium can be calculated by subtracting the expected risk-free rate from the market expected return. Equity risk premium = Market Expected Return (Rm) – Risk free rate (Rf).

Risk Premium 52

Risk Premium Equity Risk-free Rate Dividends 52

Andrew Stolz

FEBRUARY 7, 2022

Massive dividend yield secured by strong cash generation. Cash machine ensures consistent massive dividend yield. It consistently delivered strong FCFF that were more than sufficient to cover high dividends. The FCF yield shows ROEC’s dividend-paying potential. Highlights: End markets mature, no opportunities to grow.

Dividends 52

Dividends Net Debt EBIT Marketability 52

Harvard Corporate Governance

NOVEMBER 3, 2023

Posted by the Harvard Law School Forum on Corporate Governance, on Friday, November 3, 2023 Editor's Note: This roundup contains a collection of the posts published on the Forum during the week of October 27-November 2, 2023 Implementation of Share Buybacks and Their Impact on Corporate Governance Posted by Michael Seigne (Candor Partners Limited), (..)

Dividends 184

Dividends Equity Marketability 184

Chris Mercer

AUGUST 1, 2022

This eleventh post in the Deja Vu series involving restricted stock studies addresses an issue that is rarely mentioned in the context of the studies – of the impact of dividends on restricted stock discounts (RSDs). Of these 244 transactions, only 24 involved companies that paid dividends, or less than 10% of the transactions.

Dividends 52

Dividends Appraisal Marketability Start-ups 52

Reynolds Holding

OCTOBER 3, 2024

In a new paper , we explore the role of equity financing in supporting firms during the pandemic. Specifically, we examine how receiving equity financing affected stock performance, financial distress, and firms’ pay outs and investment decisions. We find that there is merit in raising equity during an economic downturn.

Equity 45

Equity Equity Financing Dividends Finance 45

Musings on Markets

MAY 7, 2023

The Intrinsic Value of Bank Equity I am a dabbler in all things valuation-related, and I find the process fascinating, as stories about businesses get translated into valuation inputs, and finally into value. All Equity, All the time! With most non-financial service businesses, you face a choice in how you approach valuation.

Banking 82

Banking Price to Book Dividends Book Value 82

Benzinga

APRIL 4, 2022

The deal values Hypebeast at a pro forma equity valuation of $534 million. Public Iron Spark shareholders will continue to receive a 5 cent quarterly dividend until the deal closes. Here’s a look at the company and deal. The SPAC Deal: Hypebeast announced a SPAC merger with Iron Spark I (NASDAQ: ISAA ) Monday morning.

Dividends 98

Dividends Equity eCommerce 98

Musings on Markets

MAY 20, 2022

In my last post , I discussed how inflation's return has changed the calculus for investors, looking at how inflation affects returns on different asset classes, and tracing out the consequences for equity values, in the aggregate.

Price to Book 102

Price to Book Dividends Beta Equity 102

Law 360 M&A

JULY 22, 2024

A private equity seller of a solar panel fintech lender that Fifth Third Bank bought in 2022 has sued the bank in New York federal court to free up $20 million in indemnity escrow funds that it alleges the bank has tried improperly to withhold over state investigations tied to the fintech.

Dividends 52

Dividends Banking Equity 52

Equidam

AUGUST 10, 2023

Guest post from an Equidam partner: Bianca Iulia Simion , Marketing Lead at SeedBlink As the world of startups continues to evolve and mature, navigating the intricacies of equity management has emerged as a critical aspect of successful entrepreneurship. This leads to confusion and potential conflict during fundraising rounds.

Equity 52

Equity Capital Structure Dividends Marketability 52

Benzinga

DECEMBER 29, 2023

An update is provided on several matters of importance for Shareholders including the acquisition, an associated dividend for ILUS Shareholders, merger agreement negotiations, subsidiaries, and financing. The company has signed contracts to acquire the controlling interest of an OTC listed SEC Reporting company.

Dividends 40

Dividends Finance Equity Technology 40

Global Finance

JULY 23, 2024

Significantly, Mizuho CEO Masahiro Kihara said the bank will either pass on the proceeds from its sales of equity holdings to investors as dividends or invest them in growth-directed activities, and Sumitomo Mitsui aims to reduce the market value of its equity holdings to less than 20% of the value of its consolidated net assets.

Price to Book 111

Price to Book Banking Dividends Equity 111

Benzinga

SEPTEMBER 9, 2024

Progress Software Corporation (NASDAQ: PRGS ) shares are trading lower on Monday. The company entered a definitive deal to acquire ShareFile for $875 million, in a combination of cash and an existing revolving credit facility.

Dividends 59

Dividends Equity 59

Value Scout

FEBRUARY 24, 2023

Private equity firms provide meaningful investment capital to growth-oriented businesses. Businesses seeking expansion, change of investors, or even exit may benefit from private equity firms. Businesses seeking expansion, change of investors, or even exit may benefit from private equity firms.

Private Equity Firm 52

Private Equity Firm Equity Start-ups Dividends 52

Brian DeChesare

JANUARY 4, 2023

Just look at the handy chart the Financial Times put together to see the horrifically bad numbers: In January 2022, everything seemed quite frothy, with mega-deals happening left and right and crypto and equity prices still at high levels. Real Estate (Equity Funds + Owned Properties): 15% [Up 5%]. Short-Term U.S.

Marketability 98

Marketability Start-ups Treasury Dividends 98

Benzinga

APRIL 26, 2023

Non-performing Assets were 0.14% of Total Assets at March 31, 2023 Common Equity Tier 1 and Tangible Common Equity Ratio of 12.16% and 7.63%, Respectively, at March 31, 2023 1 LAKEVILLE, Conn., Net Interest and Dividend Income Tax equivalent net interest income of $11.3 Capital Shareholders' equity increased $4.0

Dividends 40

Dividends Banking Equity Book Value 40

Reynolds Holding

MAY 20, 2024

One of the keys of successful private equity investing is properly aligning the economic incentives and interests of the sponsor and its portfolio companies’ management teams as they evolve over time. private equity transactions, sponsors now often grant tax-advantaged profits interests to the U.S.

Equity 45

Equity Fair Market Value Dividends Marketability 45

Brian DeChesare

OCTOBER 12, 2022

If you search for “how to start a private equity firm” online, you’ll find results that range from useless to tangentially useful to occasional nuggets of real wisdom. Starting a private equity firm is a bad decision for ~95% of people who work in the finance industry. How Does It Work? Degrees such as an MBA or a Ph.D.

Private Equity Firm 59

Private Equity Firm Equity Start-ups Marketability 59

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 79

Risk Premium Start-ups Equity Treasury 79

Auto Dealer Valuation Insights

AUGUST 26, 2024

A few weeks ago, we observed private equity investors learning a lesson about liquidity risk, which family shareholders have always known. This week, we turn the tables and explore a PE strategy that might be worth considering for some family businesses.

Equity 52

Equity Marketability Capital Structure Dividends 52

Musings on Markets

SEPTEMBER 27, 2022

In a third post on July 1, 2022 , I pointed to inflation as a key culprit in the retreat of risk capital, i.e., capital invested in the riskiest segments of every market, and presented evidence of the impact on risk premiums (bond default spreads and equity risk premiums) in markets.

Risk Premium 97

Risk Premium Treasury Start-ups Equity 97

Andrew Stolz

MARCH 6, 2020

When companies acquire a stake over another company, there are two accounting methods that could be used: cost method and equity method. Investments in equity shares of the investee company leading to the holding of less than 20% are generally accounted for under this method. Equity Method.

Dividends 52

Dividends Equity Marketability 52

Andrew Stolz

AUGUST 6, 2020

The Gordon growth model, or GGM, is used to calculate the intrinsic value of a stock from future dividends. The model only works for companies that pay out dividends, which have a constant growth rate. Dividend growth rate . What Impacts the Gordon Growth Model? The required rate of return . P = D 1 /r – g.

Dividends 52

Dividends Equity Business Valuation Finance 52

Reynolds Holding

OCTOBER 22, 2024

In leveraged buyouts (LBOs), a private equity (PE) sponsor acquires controlling ownership of a target company, typically by using a significant amount of bank loans. The findings of our study have important implications for debates about the role of private equity firms.

Equity 45

Equity Risk Premium Banking Private Equity Firm 45

Benzinga

APRIL 28, 2023

With the success of the first quarter, the Board announced a quarterly cash dividend of $0.20 of tangible shareholders' equity (1) at March 31, 2023. million; Return on average assets was 1.01%; Return on average equity of 8.91% and return on average tangible common equity (1) of 11.97% for the quarter ended March 31, 2023.

Dividends 40

Dividends Banking Book Value Equity 40

Benzinga

JANUARY 12, 2024

BlackRock Inc (NYSE: BLK ) reported Q4 FY23 revenue growth of 7% Y/Y to $4.631 billion, marginally above the consensus of $4.627 billion. Investment advisory, administration fees, and securities lending revenues increased to $3.61 billion from $3.40

Dividends 52

Dividends Beta Technology Marketability 52

Benzinga

FEBRUARY 20, 2024

Walmart Inc (NYSE: WMT ) reported fourth-quarter FY24 net sales growth of 5.7% year-over-year to $173.39 billion, beating the consensus of $170.71 Adjusted EPS was $1.80, beating the consensus of $1.65. The stock price gained after the results. Net sales from Walmart U.S. increased 3.4% was up 2.0%.

Dividends 52

Dividends eCommerce Comps Equity 52

Benzinga

MAY 9, 2023

Nexstar Media Group, Inc (NASDAQ: NXST ) reported a Q1 2023 net revenue growth of 3.9% billion, beating the consensus of $1.24 Revenues from Television Advertising declined 6% Y/Y to $425 million, comprising Core Advertising revenue that fell 2.6% Y/Y to $417 million and a 66.7% Y/Y decline in Political Advertising revenue to $8 million.

Dividends 52

Dividends Equity Marketability 52

RNC

JULY 2, 2024

This evaluation is pivotal because it dictates the terms of investment, directly influencing how much equity (ownership) a founder must relinquish in exchange for funding from the Sharks. Conversely, a lower valuation may require founders to give up more equity.

Business Valuation 52

Business Valuation Dividends Discounted Cash Flow Price to Earnings 52

Benzinga

AUGUST 12, 2024

In addition, the Company has entered a Share Exchange Agreement and strategic financing with Star Equity Holdings, Inc. million exchange of equity between the parties and Enservco's issuance of a $1 million short-term promissory note to Star (the "Star Transaction") to facilitate the closing the Buckshot acquisition.

Equity 40

Equity Dividends Compliance Finance 40