Veteran consultant and educator Scott Hoover analyzes the limitations and
idiosyncrasies of major valuation models. He examines the time value of money, cash flow
analysis, discount rates, and other tools, and describes how money managers and bankers
apply them to valuation.
Biographical note
Scott Hoover is an award-winning assistant professor at Washington and
Lee University An accomplished business valuation consultant, Hoover is a popular speaker
for professional and academic conferences and has written articles for numerous business
journals.
Discover underpriced stocks before your competition does
Successful investing is about beating market benchmarks. To do this, you need to know how
to identify, evaluate, and invest in mispriced stocks. Stock Valuation provides you with a
hands-on examination of Wall Street's most widely practiced valuation models, focusing on
the theoretical underpinnings of those models and how they perform when applied to actual
trades in the marketplace.
Accessible to sophisticated investors and indispensable for investment professionals,
Stock Valuation features:
Step-by-step examination of the building blocks of accurate valuation, leading to the
construction and implementation of a Discounted Cash Flow (DCF) model
An instructive chapter-by-chapter valuation study of an actual company, providing examples
of each concept applied in a real-life situation
Strategies drawn from three investment professionals who have outperformed the markets
over extended periods of time--Warren Buffett, Peter Lynch, and legendary mutual fund
manager Bill Miller
Underpriced companies don't generally announce their existence, but they do exist. Stock
Valuation describes the tools necessary to uncover and profit from underpriced stocks,
before the rest of the market discovers them and closes the value gap.
Accurate stock valuation is a complex process, in which investors strive to eliminate
variation and surprise while uncovering the signs that point to potentially valuable
opportunities. And while professional investors know it is the numbers that truly tell the
tale, they also know from experience that numbers derived on a spreadsheet often behave
unpredictably when subjected to the give-and-take of the market.
Stock Valuation integrates the theoretical and the practical worlds into a single resource
for the valuation of publicly traded companies. It carefully explains and provides
in-depth details for each component of the valuation process. The book also shows you how
to use this knowledge to arrive at accurate stock valuation in the real world, minimizing
risk while substantially improving investment performance.
Stock Valuation features:
A detailed look at of the investing community's most popular valuation models--the Malkiel
model, the DCF model, LBO analysis, trading comparables, and transaction comparables
Examination of a company's three main financial statements--the balance sheet, the income
statement, and the statement of cash flows--and how to accurately interpret what each is
saying
"Time value of money" equations for assessing any stock or issue in virtually
any investment situation
Techniques for first measuring risk and converting that measure of risk into a
corresponding required return
Two approaches for forecasting future growth and free cash flows, one more comprehensive
and the other more situation-specific
In Stock Valuation, seasoned valuation practitioner and educator Scott Hoover has crafted
a valuation guidebook that is both theoretically sound and consistent with how valuation
is conducted by Wall Street professionals. Covering everything from price formation and
present and future value of cash flows to discount rate calculation, analysis of key
financial statements, capital structure and cost of capital, and more, it introduces the
valuation techniques that investment professionals use, explains how and why they use
each, and what investors can do to account for the possible biases, limitations, and
idiosyncrasies they present.
Hardback
366 pages
