Stories and Numbers

I don’t always agree with Dr. Damodaran, but the video can help any analyst writing a research report. You have to link your story to numbers. He mentions that he prefers to teach history majors how to value than teach engineers how to be creative/tell a story with their numbers.

The mistake Prof. Damodaran made on Vale was not normalizing the biggest cyclical boom in iron ore prices in the past five hundred years.

Follow the discussion on valuing UBER.    This is a good exercise for valuing platform/network companies: Damordaran on UBER FiveThirtyEight

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Global Warming?

One response to “Stories and Numbers

  1. He also says that the returns to mechanical value strategies are illusory which, imo, misses the mark.

    This sort of thing is very frustrating because it leads retail investors away from profitable investment strategies. One of the sources that lead me away from net net investing after starting investing (which cost me 100s of thousands of dollars by now) was Greenwald’s “Value Investing: From Graham to Buffett and Beyond” which said that net nets didn’t exist anymore. That couldn’t have been further from the truth and set me back at least 10 years.

    Lesson: be careful what academics say and seek out a wide range of sources rather than taking what one source says as gospel truth.


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