Remove Equity Remove Market Capitalization Remove Terminal Value
article thumbnail

Disagreements and First Principles: The Pushback on my Tesla Valuation

Musings on Markets

Finally, my starting cost of capital of 10.15% reflects the reality that the riskfree rate and equity risk premiums have risen over 2022, and my ending number of 9% is an indication that I expect Tesla to become less risky over time. It was the reason that I argued at a $1.2

article thumbnail

Deja Vu #11: Can Restricted Stock Studies Be Used to Estimate DLOMs for Dividend-Paying Companies?

Chris Mercer

Were also bigger and had higher market capitalizations and better operating performance, on average. The median market value of equity (MVE) for dividend-paying stocks was $133 million, and the average MVE was $248 million. And what about the terminal value that gives rise to capital appreciation?