Tuesday, July 12, 2011

Fundamental Value

It has been a busy summer so far.  We have been working on taking Valuation Tutor (www.valuationtutor.com) to the next level.  We have now made it very easy to directly access all company filings that are in the SEC’s interactive data format.  Starting from now, most filings will be in this format, and Valuation Tutor now gives you a simple way to access all the filings (by ticker or company name).  It has a simple data collection utility that lets you extract the information you want; over time, we will be working toward making this even simpler, so stay tuned for further developments.  The data can then be used for financial statement analysis as well as (intrinsic) valuation.  The online textbook now has a step-by-step reconciliation guide that shows you how business ratios are derived directly from the statements.  Beyond that, we have a dataset where we have collected the relevant information for about 1500 companies so you and your students compare any subset of the companies along different dimensions, and also look for interesting patterns and anomalies.  The textbook and software cover five valuation models, starting with the simple dividend model and moving on to the free cash flow to equity model, the residual income model, the abnormal earnings growth model, and also an option-based model for valuing distressed firms.
The Valuation Tutor extensions are in line with our teaching philosophy: learning practical skills in an experiential way and discovering the conceptual framework along the way.  We have developed an extensive set of exercises (and solutions!) to simplify your use of Valuation Tutor. 
We will be holding webinars on all the latest features, so stay tuned.

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