Uploaded March 2025 | Updated September 2026, 1 week ago

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During this session we finished started on the loose ends in valuation, with cash and cross holdings first, and then moving on to other assets. The simple rule to follow is to make sure that you neither double count nor entirely miss assets owned by a firm. We then moved on to look how complexity plays out in valuation, before ending with questions of what to include in debt, with different rules on debt in your cost of capital calculation and debt that you net out from firm value to get to equity value. To put a bow on this part of the class, I have a blog post that you may find enjoyable about dysfunctional DCFs.
aswathdamodaran.blogspot.com/2015/02/dcf-myth-1-if-you-have-ddiscount-rate.html

Start of the class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/eqnotes/tests/looseendsnew.pdf
Slides: nyu.box.com/s/9elycygqbjowh3cprrcts0zah07c2ggb
Post class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session12atest.pdf
Post class solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session12asoln.pdf