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

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. These effects prompted widespread calls for solutions.

Equity 45

Equity Equity Financing Dividends Finance 45

Musings on Markets

JANUARY 5, 2024

I have also developed a practice in the last decade of spending much of January exploring what the data tells us, and does not tell us, about the investing, financing and dividend choices that companies made during the most recent year. Return on Equity 1. Dividends and Potential Dividends (FCFE) 1. Debt Details 1.

Dividends 105

Dividends Risk Premium Equity Book Value 105

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

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

Equilest

MARCH 28, 2025

distressed firms) Companies facing bankruptcy Impact on Investors and Stakeholders Risk to shareholders Implications for lenders and creditors How Negative Equity Affects Valuation Impacts on stock price Effect on mergers and acquisitions Can a Business Recover from Negative Equity? How does negative equity affect dividends?

Equity 40

Equity Net Debt Enterprise Value Capital Structure 40

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

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

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

Valutico

AUGUST 30, 2023

Explaining Free Cash Flow: Cash flow is like the lifeblood of a business (or your personal finances). Beyond valuations, the Terminal Growth Rate is used in various areas within the realm of finance and business decision-making. The rate at which dividends can grow sustainably is linked to the Terminal Growth Rate.

Terminal Value 98

Terminal Value Dividends Weighted Average Cost of Capital Discounted Cash Flow 98

Brian DeChesare

JANUARY 19, 2022

FSG Investment Banking: What the Financial Sponsors Group Does The Financial Sponsors Group vs. the Financial Institutions Group The Financial Sponsors Group vs. Leveraged Finance vs. Debt Capital Markets Recruiting: Who Gets Into the Financial Sponsors Group? What Do You Do as an Analyst or Associate in the Financial Sponsors Group?

Private Equity Firm 94

Private Equity Firm Banking Equity Finance 94

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

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

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

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

Reynolds Holding

JUNE 16, 2024

equity market. And yet, few scholars have examined how exactly the Big Three, and institutional investment managers more broadly, exhibit growth in equity ownership. Other corporate distributions that have a similar effect on ownership are cash financed acquisitions and going private transactions.

Dividends 45

Dividends Covariance Equity Finance 45

Musings on Markets

DECEMBER 21, 2022

Starting in late January 2023, I will be back in the classroom, teaching valuation and corporate finance to the MBAs and valuation to the undergraduates, and these classes will continue through May 2023. The class starts with a question of what the end game should be for a business (profitability, value, social good?)

Corporate Finance 99

Corporate Finance Finance Start-ups Marketability 99

Andrew Stolz

AUGUST 5, 2020

The WACC is the average cost of raising capital from all sources, including equity, common shares, preferred shares, and debt. The optimal capital structure of a company is the proportion of debt and equity financing that maximizes the company’s value while minimizing the cost of capital (WACC).

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Equity Capital Structure Equity Financing 52

Musings on Markets

FEBRUARY 8, 2022

In the four decades that I have been teaching finance, I have always started my discussion of risk with a Chinese symbols for crisis, as a combination of danger plus opportunity: Over the decades, though, I have been corrected dozens of times on how the symbols should be written, with each correction being challenged by a new reader.

Risk Premium 95

Risk Premium Beta Start-ups Equity 95

Brian DeChesare

OCTOBER 26, 2022

Collectively, these show you a company’s revenue, expenses, cash, debt, equity, and cash flow over time, and you can use them to determine why these items have changed. For example, if the company claims it will generate $5 billion of Free Cash Flow and use it to repay $1 billion of Debt and issue $4 billion in Dividends, is that realistic?

Dividends 72

Dividends Start-ups Finance Equity 72

Reynolds Holding

AUGUST 2, 2023

2019) , for example, strong ESG performance correlates positively with higher equity returns and a reduction in downside risk. In a new paper, we address the impact of ESG ratings on a firm’s financial performance by studying how those ratings affect the cost of equity (COE). The Journal of Finance 74 (6), 2789–2837.

Equity 40

Equity Equity Financing Specific Risk Dividends 40

Brian DeChesare

JUNE 1, 2022

Traditionally, the sector was viewed as a defensive play for investors who wanted stable dividends and no drama. Companies tend to offer high, stable dividend yields, and they finance their massive capital expenditures primarily with debt , with the highest leverage ratios of any industry outside of financial institutions.

Banking 98

Banking Equity Book Value Capital Structure 98

Andrew Stolz

NOVEMBER 17, 2021

When I started in finance, buybacks were almost unheard of; now, companies prefer to distribute cash through buybacks. companies have distributed more money through buybacks than through dividends. Finally, some lazy managers may use buybacks as a tool to manipulate short-term returns on equity and the stock price.

Dividends 52

Dividends Capital Structure Banking Start-ups 52

Andrew Stolz

AUGUST 6, 2020

Absolute valuation is calculated through the discounted dividend model (DDM) method and discounted cash flow (DCF) method where you only focus on the stock and look at its dividends, cash flow, and growth. Often companies don’t pay dividends every quarter or every year hence making their payouts irregular. D0 = D1 ÷ (r – g).

Discounted Cash Flow 52

Discounted Cash Flow Dividends Price to Earnings Net Present Value 52

Valutico

MARCH 20, 2023

million for the financial year ending 31 December 2022, and its tangible equity is expected to be around GBP 1.4 (USD They announced a 50% dividend payout ratio projected for 2023 and 2024 as well as a return to quarterly dividends from Q1 this year. HSBC is also planning a special dividend of $0.21 USD 1.68) billion.

Dividends 52

Dividends Banking Equity Market Capitalization 52

Reynolds Holding

DECEMBER 10, 2023

As a capital allocation decision, share buybacks intersect all three of the main corporate finance activities of investing, financing, and dividends [1]. The point being that although the logic for each of these rationales is distinct, the very act of doing a share buyback influences the whole of the corporate finance ecosystem.

Dividends 45

Dividends Total Shareholder Return Corporate Finance Finance 45

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 12, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business.

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Andrew Stolz

AUGUST 7, 2020

Within corporate finance, the agency problem is considered as the conflict of interest between the company’s managers and its stockholders. A secondary conflict is that managers want to re-invest profits in the business, while shareholders may prefer more dividends paid out. Definition of the Agency Problem.

Dividends 52

Dividends Corporate Finance Finance Banking 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 80

Equity Book Value Start-ups Corporate Finance 80

Valutico

MARCH 28, 2023

As of now, UBS is offering a dividend of USD 0.55 per common stock, with a dividend yield of 2.70%. Five-year share price chart is shown below: Source: Yahoo Finance, [link] Valutico Analysis We analyzed UBS Group AG by using our Flow-to-Equity simplified approach, as well as a Trading Comparables analysis.

Banking 52

Banking Dividends Equity Marketability 52

Brian DeChesare

AUGUST 31, 2022

Convertible bonds are hybrid instruments with elements of debt and equity, and some groups that trade convertible bonds also combine elements of S&T and IB. If you’re using a strategy like long/short equity , you could long or short a company’s stock, and your results would depend heavily on the stock market’s overall direction.

Banking 89

Banking Risk-free Rate Equity Start-ups 89

Musings on Markets

DECEMBER 15, 2021

During my teaching lifetime, I have taught a wide swath of classes, ranging from banking to equity instruments, but in the last twenty years, my focus has been on three classes, c orporate finance, valuation and investment philosophies , with the last one taught only online. The place to start is with accounting.

Corporate Finance 83

Corporate Finance Finance Start-ups Technology 83

Musings on Markets

JANUARY 6, 2023

Check rules of thumb : Investing and corporate finance are full of rules of thumb, many of long standing. I do report on a few market-wide data items especially on risk premiums for both equity and debt. Cost of Equity 1. Standard deviations in equity and firm value 4. Return on Equity 1. PE & PEG 2.

Risk Premium 52

Risk Premium Dividends Start-ups EBITDA 52