- Paperback: 512 pages
- Publisher: Financial Times/ Prentice Hall; 1 edition (6 Feb 2001)
- Language English
- ISBN-10: 013040652X
- ISBN-13: 978-0130406521
- Product Dimensions: 23.1 x 15.7 x 3.6 cm
- Average Customer Review: 4.0 out of 5 stars See all reviews (2 customer reviews)
- Amazon Bestsellers Rank: 560,926 in Books (See Top 100 in Books)
- See Complete Table of Contents
The Dark Side of Valuation
and over one million other books are available for Amazon Kindle .
Learn more
| |||||||||||||||
Did you know you can trade in your old books for an Amazon.co.uk Gift Card to spend on the things you want? Plus, get an extra £5 Gift Certificate when you trade in books worth £10 or more before June 30, 2012. Visit the Books Trade-In Store for more details. |
|
There is a newer edition of this item:
|
Product details |
More About the Author
Product Description
Amazon.co.uk Review
If the tech-stock swoon merely whets your appetite for this roller coaster of a market sector, and your eyes don't glaze over at the very sight of formulas such as "Return on Capital = EBIT (1 - t) / Capital Invested", then The Dark Side of Valuation is the investment guide you've been waiting for. Whether considering New Economy firms at their peak or their valley, suggests Aswath Damodaran, the problem has always been determining their true value with equitable dispassion. A leading expert on the topic, Damodaran begins by noting that standard corporate valuations are determined by four factors: cash flow from existing investments, growth expected from this cash flow, length of time this growth is sustained, and cost of capital to sustain it. In what he admits is not always an easy read, Damodaran then details various ways to adapt conventional valuation methods for companies that lack key traditional variables (such as profits, track records, and even competitors with which they can be compared) in order to arrive at realistic valuations. Those not scared off by charts comparing the historical risk for T-bills and T-bonds since 1928 will find this book worth a look. --Howard Rothman
Product Description
It has been a brave new world for investors, since the explosion of dot.coms onto the scene. What is their worth? How do you assess them as an investor? How do you apply traditional investment analysis to valueing them and what new analysis tools do you need? And what about companies that blend the old and new economies? How do you assess them as well? These are the frontiers on Valuation.
Inside This Book
(Learn More)
First Sentence
"In 1990, the largest firms, in terms of market capitalization, in the world were industrial and natural resource giants that had been in existence for much of the century." Read the first page
Front Cover | Copyright | Table of Contents | Excerpt | Index | Back Cover
"In 1990, the largest firms, in terms of market capitalization, in the world were industrial and natural resource giants that had been in existence for much of the century." Read the first page
Explore More
Concordance
Browse Sample PagesConcordance
Front Cover | Copyright | Table of Contents | Excerpt | Index | Back Cover
Tag this product(What's this?)Think of a tag as a keyword or label you consider is strongly related to this product.
Tags will help all customers organise and find favourite items. |
What Other Items Do Customers Buy After Viewing This Item?
Customer Reviews
Most Helpful Customer Reviews
13 of 15 people found the following review helpful
Format:Paperback
As a (new economy) research analyst, it has long been my view that a book on valuing very high growth/volatile stocks is DESPERATELY needed. In The Dark Side of Valuation, Damodaran goes someway to filling the current valuation knowledge gap. However, I would critise this book as being highly repetitive of some of his previous (old economy) work - he takes almost 500 pages to say what I could summarise in 100. I expected the book to spark many new ideas about valuing the companies I personally analyse. It did NOT do this. Probably still worth buying the book though ... I keep it on my desk with about 10 pages marked which are worth a look at.
7 of 8 people found the following review helpful
Format:Paperback
I think this is one of the most complete books on companies valuation. This book perfectly complete the other Damodaran's book on Valuation. The Dark Side of Valuation is comprehensive guide to valuing technology companies (fundamentals, revenue multiples, and earnings multiples).
Damodaran's book show various ways to adapt conventional valuation methods for new economy companies. It contains concepts like as PEG,EBITDA,CFROI or how to include management options in valuation. It also includes detailed case studies of technology companies(Motorola, Ariba, Cisco, and a new IPO-ready startup).
In a few words this book is one of the best books on financial analysis and in the new economy market.
Most Helpful Customer Reviews on Amazon.com (beta)
Amazon.com:
7 reviews
64 of 65 people found the following review helpful
'Investment Valuation' with new title and cover
24 April 2002
Format:Paperback
The Pros:
Damodaran is a gifted teacher and in his books is able as well to explain the concepts and techniques of valuation in an understandable manner. The book serves mainly for readers who want to get a comprehensible (and to a certain degree comprehensive) overview of the topics with selected in-depth discussions and it is quite 'readable'.
The Cons:
The book is not new at all, as about 90% is a copy of his earlier book 'Investment Valuation'. The only real difference is the selection of the examples used and the financial and market data are more current compared to his other book from 1994. It seems that the marketing department of the publisher saw an opportunity to sell a 'new' book to the new class of technology investors. However, the occasional comments of which valuation topics are specific to technology companies could be summarized on a couple of pages.
The book is good for giving a comprehensible overview but does not go very much into depth.
Effectively, it's the earlier book 'Investment Valuation' recycled with a new title and new cover, still a good book but not new at all.
33 of 35 people found the following review helpful
The best book so far on valuation from the investor's view
9 Nov 2001
Format:Paperback
Although much of the organization and explanation of valuation techniques presented here repeats the presentation in Damodaran's previous books, he does two things which make this the better book than the previous books: 1) he discusses the role of "tech" companies in our economy and he selects 5 specific companies which serve as his examples in every chapter and 2) he makes reference to excel spreadsheets (available for free download on his web page) which he has prepared to allow readers to apply what they are learning immediately and with a minimum of set-up time. As tech companies play a larger and larger part in our economy, the specific quirks and issues related to the operation of tech businesses and the impact of those industry-specific issues on the valuation process become more important for us. One might argue that all companies, whether they are wine makers or processor makers, face industry-specific valuation issues which do not affect companies in other industries, and in light of that, many issues discussed here might not be relevant to the wine makers. But tech is so important to us now that we can no longer afford to use generic, non-tech specific techniques in the face of an increasingly tech-heavy stock market.
As for the reviewer who compained that Damodaran doesn't do enough work in real option theory: Damodaran says in this book exactly what needs to be said about real option theory: that it has very limited applications (which is not to say that it is not revolutionary within those limited applications) and that the push to broaden the use of real option valuation beyond its traditional applications can more often than not constitute misuse and abuse of the models. Not every investment contains options, and not all of those options have value, to paraphrase Damodaran himself. Damodaran doesn't ignore real options, of course: he calls them contingency claims (as they technically should be called) and dedicates a chapter to explaining there use and abuse. Using real options, when it comes down to it, involves building and solving partial differential equations based on stochastic processes. As any actuary or financial analyst could confirm, teaching stochastic processes presupposes a very strong math base and still would require an entire book. Damodaran did the right thing by limiting himself to a single, illustrative chapter.
The best part of this book is that thanks to Damodaran's congenial and accessible ability to write, this book can be read and prove valuable to people with a variety of needs. As an MBA student this book has been invaluable. But I even gave this book as a gift to my brother, a decidedly non-financial person, to replace his countless "How to Invest" books sitting on his bookshelf.
36 of 41 people found the following review helpful
Strong on the valuation of old tech companies
18 Mar 2001
Format:Paperback
Excellent introduction to discounted cash flow approach to valuation. Excellent examples. But very weak on real options valuation. After recognizing that real options are mostly american, the author values them like european anyway resulting in systematic undervaluation of real options. This is a shame since much of the value of new companies come from real options. If you are already familiar with DCF valuation, then you might prefer Copeland's 'Real Options' to bring yourself up to date with the latest developments in the practice of valuation.
Were these reviews helpful?
Let us know
Listmania!
Look for similar items by category
Look for similar items by subject
Feedback
- Would you like to update product info or give feedback on images?
- I am the Author, and I want to comment on my book.
- I am the Publisher, and I want to comment on this book.
