FIN 352: Investments I  -   Professor Dow

Part IV – Stock Valuation and Fundamental Analysis

The goal of this section is learn how to value stocks using fundamental analysis.  This is only an introduction to the topic and you should not use these techniques to invest in stocks without additional research! 

 

 

Checklist:  Additional Readings:

11.  Stock Valuation

__ Reading: Jones, Chapter 11
__ Reading: Jones, Chapter 10
__ Lecture: The Process of Fundamental Analysis/Value Investing.
__ Lecture: Valuation Using Discounted Cash Flow
__ Lecture: Valuing Google
__ Powerpoint: Valuing Google
__ Shiller Data
__ Flash Cards: Quizlet, PDF
__ Problems: P10.1, 10.2, 10.3, 10.7, 10.10, 10.17.

Speech by Charles Munger
Berkshire Hathaway Shareholders Letters

Damodaran has a more advanced treatment of valuation and security selection

Damodaran Stock Market Valuation

Shiller Data: Charts for Class


12.  Company Analysis
__ Reading: Jones, Chapter 15
__ Lecture: Financial Statements and Financial Ratios
__ Assignment 11: Find information about a company
__ Assignment 12: Financial ratio analysis
__ Assignment 13: Valuation using earnings
__ Assignment 14: Valuation and sustainable growth rates
__ Problems: P15.1, 15.2, 15.3

Jones, Chapters 13 and 14, discuss macroeconomic analysis and industry analysis. We don’t cover these chapters in class because the topics are so exensive that one or two lectures will do very little.

Readings on financial statements:

SEC
Study Finance
Wikipedia
Net MBA
Investopedia