8 Comments

Excellent Post. What software do you use to run the simulation/Monte Carlo? I am interested in that capability.

Thank you.

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Hi Professor Damodaran,

I have made the same comment on the You Tube post so please feel to ignore one of them. It has been a few years since I completed your class so perhaps my memory is playing tricks on me. Can you please clarify your latest thinking on a company's terminal ROIC. I thought that you taught me that most companies will not achieve a terminal ROIC above their terminal cost of capital. The exceptional companies which do have a higher ROIC will not be above 12% (as a rule of thumb). I note that you have given NVIDIA a terminal ROIC of 20%.

Can you also clarify the cost of capital element in your Monte Carlo simulation. Did you mean to vary the initial cost of capital? I would have thought that the valuation would be far more sensitive to the terminal cost of capital.

Many thanks & best regards, Rob

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Thanks Professor, always enjoy reading your posts.

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Since market size is one of the key building blocks in ascertaining the value, I would like to know the parameters that you use to judge the efficacy of the various estimates that is floated around?

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Dear Prof Damodaran,

Thank you for so generously sharing your knowledge. It is a pot of gold for me as a private investor and I am learning a lot.

One question: Why is the terminal year FCFF value only 10. 6 billion? Looks very low. Am I overseeing something? I could not find the story to that figure in your elaborations...

Best wishes,

Tom

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