tag:blogger.com,1999:blog-8152901575140311047.post7091334422361137680..comments2024-03-28T12:49:46.624-04:00Comments on Musings on Markets: Reacting to Earnings Reports: Let's get real!Aswath Damodaranhttp://www.blogger.com/profile/12021594649672906878noreply@blogger.comBlogger25125tag:blogger.com,1999:blog-8152901575140311047.post-66802002113061790602015-07-30T04:16:02.350-04:002015-07-30T04:16:02.350-04:00We miss your Apple valuations and it's been ne...We miss your Apple valuations and it's been nearly a year since your last. If you have any thoughts I'm sure you'll have many interested readers :)mattlesnakehttps://www.blogger.com/profile/11777119467159533835noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-39871434473043307382014-11-20T15:54:35.567-05:002014-11-20T15:54:35.567-05:00I hope you did not sell your AAPL shares near $100...I hope you did not sell your AAPL shares near $100. <br /><br />There are lots of factors in valuing a company that cannot be measured by looking at available data.<br /><br />I am still amazed by people waiting for days outside Apple stores just to buy the latest iPhones. Also, look at the prices people are asking to sell their iPhone 6/6+.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-85821032785957168102014-09-18T13:54:24.366-04:002014-09-18T13:54:24.366-04:00Hi Prof. Damodaran,
Would the announcement of App...Hi Prof. Damodaran, <br />Would the announcement of Apple Watch and Apple Pay change your outlook on Apple? Or is that still too early to tell?Howardhttps://www.blogger.com/profile/07818510257399441176noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-3117497686970606312014-09-11T10:02:21.565-04:002014-09-11T10:02:21.565-04:00> "I think it is prudent for me as an inve...> "I think it is prudent for me as an investor to map out an exit plan, if the stock price rises to $100 or higher...."<br /><br />Just curious: have you sold your AAPL (the $100+/share target has reached recently)?<br /><br />I have not sold a share yet. As long as the iPhone growth continues (market share is not a good indicator because AAPL does not play to "junk" phone game).<br /><br />My key observation is this: Android is a training device for people to buy iPhone later. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-45358538854957908402014-08-30T06:55:42.611-04:002014-08-30T06:55:42.611-04:00How do you control for bias in your inputs? Even t...How do you control for bias in your inputs? Even though your price targets for AAPL have been less volatile than the chart, your valuation still changes dramatically (at least in my view). <br /><a href="http://giaitrimobile24h.blogspot.com/2014/08/tai-game-ngoc-rong-online.html" rel="nofollow">ngoc rong online</a><br>Anonymoushttps://www.blogger.com/profile/17436924176267047789noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-80303823530215556092014-08-29T11:13:50.690-04:002014-08-29T11:13:50.690-04:00Do you take requests? SPLK would be an interesting...Do you take requests? SPLK would be an interesting one to look at.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-85513245063800761452014-08-28T22:18:17.334-04:002014-08-28T22:18:17.334-04:00I really enjoy reading your blog and learned a lot...I really enjoy reading your blog and learned a lot. <br /><br />Are you going to post something for Alibaba(BABA)? <br /><br />Please say yesssssss!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-69393613658121415862014-08-22T19:51:47.192-04:002014-08-22T19:51:47.192-04:00Professor, thank you for these posts, and sharing ...Professor, thank you for these posts, and sharing your thoughts. I enjoy reading every one of them. Would you please also share your take on LinkedIn? Best wishes to your health.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-83748145284923429422014-08-20T10:38:09.531-04:002014-08-20T10:38:09.531-04:00Aswath, I am confident that there is far more here...Aswath, I am confident that there is far more here for you than how I sense things seem to you based on your comments. <br /><br />I can see you have the possibility of knowing who we are and I am confident that you can find encouragement. Our discussion of Tesla is a small matter compared to this.<br /><br />I wish you well,<br /><br />SteveAnonymoushttps://www.blogger.com/profile/09408330447204015528noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-4934231061685944522014-08-18T11:46:54.197-04:002014-08-18T11:46:54.197-04:00Ashwanth,
Thanks for sharing your valuable knowled...Ashwanth,<br />Thanks for sharing your valuable knowledge on this blog and your iTunes class for free. Its yet another example of "best things in life are free."<br /><br />GoPro has been gaining a lot of marketing hype recently, would love to hear your thoughts on the stock.Ashnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-91424032543044722872014-08-17T01:58:16.531-04:002014-08-17T01:58:16.531-04:00I don't think Bill Gurley's post was bette...I don't think Bill Gurley's post was better than Prof's post or the other way around. <br /><br />It is just the perspective with the information and certain bias of course one had while doing valuation. <br /><br />I am more prone to buy into Prof's views on Uber than Bill's because when you have a large stake you usually tend to defend yourself. <br /><br />What would make out of Uber in the coming years is anybody's guess (including insider managers); it is a tough business and I don't think there is too much of barriers to entry. Therefore giving it a large market share, network effects, and so forth is probably a fantasy. <br /><br />To be fair to Prof, let's just give him his space where he can lay down his thoughts. Many learn out of it. <br /><br />Regarding value investor and all that stuff, it is all nonsense. There is either an investor or a trader speculator. Investor tries buy low and sell high based on fundamental analysis. Trader tries to do so based on market trend analysis. My personal opinion is trader is never going to make money consistently over time, while investor has a chance.<br /><br />-sunAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-17692448426386615292014-08-14T19:31:23.143-04:002014-08-14T19:31:23.143-04:00Steve,
Let's agree to disagree. When I say tha...Steve,<br />Let's agree to disagree. When I say that the narrative is in flux, it is because I thought that Tesla was an electric car company at the start of the year. For much of the year, all the talk that I have heard from the company is about its electric batteries, but that story was undercut by Musk's offer to give away the battery technology. Perhaps, the company is reorienting itself and I will have to factor that into my next valuation.<br /><br />For the moment, though, I would not buy Tesla at $230, $180 or even $150. You obviously believe otherwise. So, you should hold on to your stock and I won't try to talk you out of that decision. Please return the favor and leave me to my valuation. Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-5820606418921256772014-08-13T20:27:43.633-04:002014-08-13T20:27:43.633-04:00Aswath,
I'm quite puzzled by your response.
...Aswath, <br /><br />I'm quite puzzled by your response.<br /><br />It was not at my request that you twice in the past year wrote blogs on Tesla declaring it was highly overvalued based on a decade long forecast of its business you created. <br /><br />These blogs that were picked up by various media outlets including the Wall Street Journal. At your discretion and obviously not my invitation, you took both your narrative of an overvalued stock, and the public's trust and respect for your position as a PHD in finance onto CNBC to lay out that narrative.<br /><br />Now, if you tell me today, you are not confident that you have enough information to value the stock, I will not argue with that. However, how can you claim that this is due to your "being a slow learner", if you already twice quite publicly delivered valuations on the company saying it was overvalued.<br /><br />If you've learned that those conclusions were made to hastily, and rather than a slow learner, you were premature in your conclusions, isn't it only fair to the public, Tesla's shareholders and would be shareholders to clarify this situation... to let it be known as publicly as those CNBC appearances that you in fact do not think Tesla is overvalued, as you now realize the reality of your perception of Tesla's future is not clear enough to make a valuation call, nor was it clear enough to call it overvalued when you twice did so this past year.<br /><br />Not to be super heavy, but Professor, please, really think about what you think is fair and what kind of world you want to live in.<br /><br />All the best,<br /><br />Steve<br />Anonymoushttps://www.blogger.com/profile/09408330447204015528noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-69943410086881599902014-08-13T14:46:36.058-04:002014-08-13T14:46:36.058-04:00Hi Prof -
Will you discuss your exit plan in gene...Hi Prof -<br /><br />Will you discuss your exit plan in general? Or, how would you do it for Apple as an example? Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-23094291286092649382014-08-12T21:30:12.323-04:002014-08-12T21:30:12.323-04:00Steven,
You are persistent but I don't plan to...Steven,<br />You are persistent but I don't plan to return to Tesla until I have a clearer sense of the narrative for the company. At the moment, I don't know what the end game for the company is yet. I know that you have a narrative you feel strongly about & I wish you the very best with your investment but I am a slow learner.Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-51065801766945772082014-08-12T06:16:45.885-04:002014-08-12T06:16:45.885-04:00Hi Aswath,
I´m learning value investing and I wou...Hi Aswath,<br /><br />I´m learning value investing and I would like to ask you if you have any writte up about the importance of return on capital employed, and how to calculate it?<br /><br />ThanksDavidnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-84301472514937158872014-08-11T16:42:18.761-04:002014-08-11T16:42:18.761-04:00Hi Aswath,
Wondering if you had a chance to do yo...Hi Aswath,<br /><br />Wondering if you had a chance to do your own research on the points I discussed with you about Tesla in response to your 3/25 blog attempting to value the company (as you'll remember, I offered you some specific information about Tesla to help you see that you were dramatically overestimating both the amount of capital they would need to raise in the next decade, and future stock dilution to do so, and thus, drastically understating future earnings, and current valuation based on those earnings).<br /><br />So, have you had a look at this? Did you end up buying shares? Did you wait and get an entry point in the range I suggested ($170-210)?<br /><br />Will you be writing another piece on Tesla with a fresh look at the far more modest capex spending they will need to get to 1 to 1.5 vehicles sold per year?<br /><br />Curious what you are thinking.Anonymoushttps://www.blogger.com/profile/09408330447204015528noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-70906765801128731562014-08-11T14:31:03.822-04:002014-08-11T14:31:03.822-04:00Prof. Damodaran,
I am done with playing devil'...Prof. Damodaran,<br />I am done with playing devil's advocate and want to let you know that I follow your blog faithfully. Every time, I read what you write, I ask myself how can one be so smart and so productive and write so well too. Your students are very lucky to have you as teacher. Having said that, I have to say that Bill Gurley gave you a run for your money re the Uber valuation.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-47571201326871542692014-08-11T12:47:19.394-04:002014-08-11T12:47:19.394-04:00Hi Aswath,
Just a concern regarding your blog. Ev...Hi Aswath,<br /><br />Just a concern regarding your blog. Even though I have subscribed to the email (from 2 different accounts), the mail is never delivered to my ID. I think your feedburner is not processing these things properly. Kindly look into it. Hectornoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-6655229432144663482014-08-11T08:39:15.156-04:002014-08-11T08:39:15.156-04:00First, it is hypoctrical only if I try to tell you...First, it is hypoctrical only if I try to tell you to buy or sell stocks or get you to adopt my investment philosophy ( which Cramer does). I have used this blog to explain what I think about investing, not sell you on it. Second, you have much better data than a self-reported portfolio return which you cannot check. I have posted on almost every stock that I have bought or sold in real time when I did it for the last five years. So, you know that I sold FB too early, that my YHOO holding is still struggling, that my VALE & PBR investments had a flat first year. So, do with it what you want. As I have said repeatedly, every investor needs to develop his or her own investment philosophy & take responsibility for their investment choices. Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-34464377039820158642014-08-11T01:37:43.912-04:002014-08-11T01:37:43.912-04:00Thank you so much for clarifying your investment p...Thank you so much for clarifying your investment philosophy. However, the ultimate test of an investment approach is how it performs over time.<br />Have you ever disclosed the performance of your portfolio? How is it compared to the index funds or the rigid, ritualistic and righteous approach of the Ben Graham Club?<br />You are one of the finance people I respect the most. However, it would be hypocritical of you if your students and online followers don't know how you perform in real life, not just in terms of theory and logic. An example of hypocrisy is Jim Cramer. He goes on TV telling people to buy and sell specific stocks every day but his own personal portfolio consists mostly low-cost index funds because what he tells others just doesn't work.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-79971603557342915722014-08-10T08:33:16.392-04:002014-08-10T08:33:16.392-04:00If your definition of a value investor is someone ...If your definition of a value investor is someone who buys something that is undervalued & holds forever, I am not one. If it is someone who buys something that is under valued, keeps revaluing at regular intervals & sells when it is overvalued, I may qualify. To be honest, I don't particularly care about whether the value investors' club lets me be a member. I find many of its current members to be rigid (I don't think that the world revolves around Ben Graham), ritualistic (I am perfectly okay never going to Omaha for the rest of my life) and righteous (I don't think traders are consigned to valuation hell).<br />In my world, intrinsic values changes all the time, though less than prices do, and my investment process is a continuous one that does not end when I find a stock to buy.Aswath Damodaranhttps://www.blogger.com/profile/12021594649672906878noreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-86844664587130924332014-08-09T17:32:16.145-04:002014-08-09T17:32:16.145-04:00You claim to be value investor, but what you do se...You claim to be value investor, but what you do seems to be market timing to me: jumping in and out hoping that your valuation is correct.<br /><br />How is your approach different from a market timer who jumps in when he thinks things are cheap and jumps out when he thinks things are expensive?<br /><br />You don't want to have confused students, do you?<br />Thanks.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-48970402989134276222014-08-09T14:15:46.887-04:002014-08-09T14:15:46.887-04:00Why would you exit apple if the stock crosses $100...Why would you exit apple if the stock crosses $100? Wouldn't you sell apple only if the narrative for the company changes for the worse. Does it not seem like you are playing the pricing game?<br /><br />PS: big fan.UniverseofRisksnoreply@blogger.comtag:blogger.com,1999:blog-8152901575140311047.post-17341339745802315782014-08-09T03:34:32.255-04:002014-08-09T03:34:32.255-04:00How do you control for bias in your inputs? Even ...How do you control for bias in your inputs? Even though your price targets for AAPL have been less volatile than the chart, your valuation still changes dramatically (at least in my view). <br /><br />I have held the belief that AAPL should trade around 12x ex-cash because growth cannot happen forever (in a few years, AAPL would have 100% market share of phones). I now feel the push in my own mind (even though I am cognizant of bias changes) to upgrade the PE in AAPL to 15x. PE growth for the rumored IPhone 6 (larger screen - the main reason why I don't have an IPhone), the rumored iWatch and all the potential benefits to health, and the new CFO that is more aggressive in buying back stock (increasing EPS growth). Josh Hnoreply@blogger.com