Equilest
JANUARY 7, 2025
By identifying earnings manipulation and guaranteeing more accurate firm values, this clever little technology is here to save the day. A high M-Score could indicate higher risk, warranting a higher discount rate and thus a lower valuation. It's like adding a risk premium, but based on hard data rather than gut feeling.
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 Debt 2.
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Musings on Markets
JANUARY 5, 2024
Beta & Risk 1. Equity Risk Premiums 2. Standard Deviation in Equity/Firm Value 2. Book Value Multiples 3. Employee Count & Compensation I nvesting Principle Financing Principle Dividend Principle Hurdle Rate Project Returns Financing Mix Financing Type Cash Return Dividends/Buyback s 1. Buybacks 2.
Musings on Markets
JANUARY 10, 2025
Thus, as you peruse my historical data on implied equity risk premiums or PE ratios for the S&P 500 over time, you may be tempted to compute averages and use them in your investment strategies, or use my industry averages for debt ratios and pricing multiples as the target for every company in the peer group, but you should hold back.
Musings on Markets
FEBRUARY 6, 2025
The logical step in looking across countries is measuring risk in countries, and bringing that risk into your analysis, by incorporating that risk by demanding higher expected returns in riskier countries. The answers, to you, may seem obvious, but I find it useful to organize the obvious into buckets for analysis.
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