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Aswath Damodaran

Aswath Damodaran

I teach corporate finance, valuation and investment philosophies at the Stern School of Business at New York University. I have online versions of all three courses here, as well as other finance-related videos.
1. The Corporate Finance Online playlist has an introductory video and 36 sessions that cover all of corporate finance (at least as I see it).
2. The Valuation playlist has 25 sessions that cover valuation approaches, issues and questions.
3. The Investment Philosophies playlist has sessions that cover different investment philosophies.
4. The Accounting and Statistics playlists reflect my quirky and unorthodox introductions to two disciplines that are critical to my valuation and corporate finance classes.
5. The Blog Posts playlist has sessions that go wit my blog posts and reflect my standing as a dabbler, rather than expert, in all things finance-related.
If you need the supporting material for any of the classes, check the links below.

Links:
Corporate finance materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/corpfin.html
Valuation materials: http://www.stern.nyu.edu/~adamodar/New_Home_Page/equity.html
Investment Philosophies: http://www.stern.nyu.edu/~adamodar/New_Home_Page/invphil.htm
Books: http://www.stern.nyu.edu/~adamodar/New_Home_Page/public.htm
My website: http://www.damodaran.com

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  • Monday · 55 min

    The Scaling and Profitability Trade-off: Venture Capital's weakest link!

    Every business is faced with the question of whether to become bigger or build a better business model (delivering more in profits) and in this session, I start by looking at the factors that make that choice different for different businesses. I look at the conditions that make scaling up easier at some business than others, and the ingredients that go into a better business model. I also model out how founder characteristics (control versus ambition, longevity versus growth) and investor preference play into the scale vs profitability choice. In particular, I look at venture capital, the first stop for many ambitious business, and how the VC game (more pricing than value, top-heavy in terms of returns, lots of failures) can tilt businesses to prioritizing scaling over business models. I also look at two developments - a gray market, where private businesses can access increasing amounts of public equity, before they go public, and a public equity market, where momentum has stayed strong but reversals have weakened, and how those developments are also putting scaling ahead of business-building. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/ScalevsProfits.pdf Blog Post: https://aswathdamodaran.blogspot.com/2026/09/the-scaling-and-profitability-trade-off.html Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Monday · 52 min

    From Eyeballs to ARR: Buzzy Pricing Metrics and the AI Trade!

    As the Anthropic IPO approaches, it is worth remembering that IPOs are priced by VCs and bankers, not valued, and that pricing can often be on metrics that are unfamiliar. That has always been the case for young companies, with pricing scaled to website visitors and eyeballs in the dot com era to the numbers and subscribers in the social media decade. With AI, the metric that companies have latched on to is the annualized revenue run rate (ARR), where you take revenues in a recent period (weekly, monthly) and annualize it. In this session, I start with a look at the characteristics of young companies, which include small and fast-growing revenues, operating losses, negative cash flows and concerns about survival, and why many investors choose to give up on valuing these companies, because of these characteristics. Instead, they price these companies, but pricing is challenging as well, with pricing metrics, peer group choice and company differences all throwing wrenches in your work. All through the session, I use Anthropic and OpenAI was my lab experiments to illustrate both the challenges and solutions. Those expecting a resolution to the question of whether to bid for Anthropic shares at the offer price will be disappointed, but I hope that the framework for pricing endures and helps you make that decision. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/PricingAI.pdf Blog post: https://aswathdamodaran.blogspot.com/2026/10/from-eyeballs-to-annual-run-rates-arr.html Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Sunday · 54 min

    The Prospectus is here: My (but not the) Anthropic IPO Valuation!

    The long-awaited Anthropic prospectus is now public, and as promised, I value the company. I start with an examination of what we can learn from the prospectus about revenue growth, profitability, reinvestment and risk at Anthropic, noting that both optimists (glass half full) and pessimists (glass half empty) will find reasons to celebrate, but that it is still a snapshot of a young company that is evolving. To value Anthropic, you have to leave the safety of reported numbers, and make your estimates of target revenues, end-game profit margins, reinvestment needed to deliver growth and risk, and I do, with a caveat. These represent my story for the company and I will not only be wrong 100% of the time, but your decision on whether to invest in Anthropic has to come from your story, and value, not mine. During the session, I try (but may fail) to do this, by providing you a framework to make your own choices, and assess your own value! Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/AnthropicIPO.pdf Blog Post: https://aswathdamodaran.blogspot.com/2026/10/the-anthropic-prospectus-arrives-ipo.html Anthropic Prospectus: https://www.sec.gov/Archives/edgar/data/2130357/000162828026067168/anthropicpbc-sx1.htm Anthropic valuation: https://pages.stern.nyu.edu/~adamodar/pc/blog/AnthropicIPO.xlsx Google shared spreadsheet (for you to enter your numbers): https://docs.google.com/spreadsheets/d/1oux4pQo8bLnx5tvVH25j8yCXrFK0_5qviiAzuXqk-Fg/edit?usp=sharing Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Sunday · 58 min

    Heeding the Feedback Loop: A follow-up to my Anthropic Valuation

    I valued Anthropic, after its prospectus filing and ahead of its IPO, at $1.475 trillion about a week ago, and was open about the fact that I was telling a big story, with inputs and value to match. I encouraged people to push back and come up with their own stories, inputs and values for the company and many did. In this session, I start by playing devil's advocate with my own valuation, and list what I believe are the five biggest drivers of its value - target revenues tops the list, followed by governance, profitability , reinvestment and regulatory risk. I then look at your valuations and feedback, and note that the input that received the most pushback was my cost of capital of 9.74% , which some thought was too low. Since the cost of capital is much misunderstood concept that many use without frames of reference, I look at what a reasonable cost of equity (capital) is for a US firm in September 2026, and follow up with a table that lists out ranges for costs of capital, by sector. I argue that setting too high a cost of equity (capital) handicaps investors and businesses, creating more harm than good. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/AnthropicFollowUp.pdf Blog post: https://aswathdamodaran.blogspot.com/2026/11/the-anthropic-feedback-loop-cost-of.html Cost of capital, by industry group: https://pages.stern.nyu.edu/~adamodar/pc/blog/waccUS.xlsx Historical returns on stocks: https://pages.stern.nyu.edu/~adamodar/pc/datasets/histretSP.xlsx Market-implied expected returns history: https://pages.stern.nyu.edu/~adamodar/pc/datasets/histimpl.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Sunday · 44 min

    Deconstructing the AI Trade: Market Meltdown, Correction or Clean up?

    The market's sharp drop on November 5, driven by a decline in tech, renewed a question that has been heard all year of whether this is the final call on the AI trade, where investors buy all stocks AI-related and hope to ride the AI buzz to riches. In this session, I argue that as the AI disruption ages, it is time to break the companies in the ecosystem down into AI builders (the hyperscalers and others building the data centers), AI suppliers (the chip and electrical equipment makers, power and real estate) who supply the ingredients for the AI architecture and AI product companies (which use the AI architecture to make AI agents, products and services). These AI groups are linked in operations to each other, with one company's costs becoming the other company's revenues, and have very different business models. To assess how they have moved (together and apart), I look at 35 publicly traded companies and their market cap movements between the end of 2022 and 2026, with a special focus on the most recent year. In a final section, I look at how I see what I call the big market delusion (where the allure of a big market combined with overconfidence) is playing out with AI, and use it to put the market action in context. (I apologize for the noise problems on the video, which I recorded on the road and in a room with a very loud air-conditioner in the background, with no turn off switch.) Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/AITrade.pdf Blog post: https://aswathdamodaran.blogspot.com/2026/11/the-ai-trade-deconstructed-ai-builders.html Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 20 min

    January 2018 Data Update 10: The Price is right!

    In this post, the last one on my data update for 2018, I turn my attention from the company's fundamentals to the pricing. I contrast value with price, and present a four step approach to doing pricing right, before presenting the global distributions of PE, EV/EBITDA, book value and revenue multiples. Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/dataupdate10for2018.pdf Blog Post: https://aswathdamodaran.blogspot.com/2018/02/january-2018-data-update-10-price-is.html Data Links: 1. Multiples, by Sector in January 2018: http://www.stern.nyu.edu/~adamodar/pc/blog/SectorMultiples2018.xlsx 2. Multiples, by Country, in January 2018: http://www.stern.nyu.edu/~adamodar/pc/blog/CountryMultiples2018.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 39 min

    Earnings, Cashflows and Stock Prices: The AI Storm blows through!

    The key reason that US equities have held their own this year, in the face of rising interest rates, is a surge in aggregated earnings, which some have attributed to the massive investments in AI cap ex. In this session, I start by updating my market views to October 1, by bringing in September's explosive rise in rates and updating my estimates for expected returns and equity risk premiums for US stocks. I then turn to the real focus of this session, which is looking at how the trillions being invested in AI cap ex are playing through income statements, balance sheets and cash flows for the AI builders (who are spending the money on the AI cap ex) and the suppliers of the AI architecture (chips, networking equipment, power, cooling and real estate. Across all publicly traded firms, AI cap ex has significantly bulked up balance sheets, with both book debt and equity rising, and at least in the aggregate, increased earnings, as the amortization of AI cap at the builders (which lowers earnings) is being swamped by the net income generated by the AI suppliers, from providing the ingredients. In the aggregate, US companies are generating less in free cash flows, and dividends and buybacks are growing far more slowly than earnings. I close with an assessment of the choices we face as investors, as the AI storm roils the waters. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/MktandAI2026.pdf Blog post: https://aswathdamodaran.blogspot.com/2026/10/stock-prices-earnings-and-cashflows-ai.html Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 1 hr 30 min

    Session 25: Valuation Inputs

    In this session, we continued on the question of how best to value a company by first looking at the four key components of value - cash flows from existing investments, growth in the future, discount rates and the terminal value. With cash flows, we noted the contrast between cash flows to equity and cash flows to the firm, with the former being after debt payments and the latter before. With discount rates, we argued that the same discount rates that we computed for investment hurdle rates can be used in valuation, with the caveat that these discount rates will change over time, as a company changes. While you can adjust betas, costs of debt and debt ratios, a simpler way to target a cost of capital in stable growth is to look at the median cost of capital for companies. The median cost of capital for a global company now is about 7.5%, in US dollar terms. With growth, the key is recognition that growth comes from what companies do in terms on how much they reinvest and how well, rather than from outside sources. Finally, for terminal value, I argued that the growth rate in perpetuity has to be less than or equal to the risk free rate. Slides: https://www.stern.nyu.edu/~adamodar/podcasts/cfspr22/session25slides.pdf Post class test: https://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25test.pdf Post class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session25soln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 26 min

    DataUpdate 9 for 2018: Dividends, Buybacks and Cash Balances

    The end game for every successful business, if you are an investor, is the harvest phase, where you collect cash flows from it. That is the role of dividends in corporate finance, but done right, it should be a residual cash flow that grows as a company ages. In practice, at many companies dividend policy is set on auto-pilot, driven by inertia (past dividends) and me-too-isms (what the rest of the sector is paying). I chronicle the shift from dividends to buybacks not just in the US, but globally, and report on dividends and buybacks across regions and sectors. Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/dataupdate9for2018.pdf Blog Post: https://aswathdamodaran.blogspot.com/2018/02/january-2018-data-update-9-dividends.html Data Links: 1. Dividends, Buybacks and Cash Balances, by Country: http://www.stern.nyu.edu/~adamodar/pc/blog/CountryDividends2018.xlsx 2. Dividends, Buybacks and Cash Balances, by Sector: http://www.stern.nyu.edu/~adamodar/pc/blog/SectorDividends2018.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 51 min

    AI's Bar Mitzvah Moment? From Hype and Hope to Business Questions!

    It is undeniable that AI has taken over business and investing conversations since ChatGPT's debut on November 30, 2022. In addition to pushing up the market capitalizations of the companies that supply its infrastructure (chips, power, electrical equipment), it has also given rise to the largest investment build-up in history, with $2 trillion spent so far on AI architecture, with more to follow. The debate about AI though has been stunted by people talking past each other, with advocates pointing to its potential market being "huge" and skeptics noting that the "massive" cap ex makes value creation impossible. I much confess that I find myself pulled in a dozen different directions, as the debate unfolds on multiple dimensions (open vs closed models, AI as tool or employee replacement, AI as good or bad for society). This session was really meant for an audience of one (me), and during the session, I try to develop a framework for making sense of AI as a business. In the process, I develop tools that I can use to judge whether Anthropic is worth $2 trillion and whether the hyperscalers can get sufficient payoff from their trillion in AI cap ex. I hope that you find my framework and tools useful. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/AIBusiness.pdf Blog Post: https://aswathdamodaran.blogspot.com/2026/08/ais-bar-mitzvah-moment-from-hype-hope.html Spreadsheet: https://pages.stern.nyu.edu/~adamodar/pc/blog/BreakevenEnterprisevalue.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 16 min

    In Practice Webcast 7b: Estimating Cost of Capital for a Privately Owned Business

    The models that we use to estimate cost of equity and capital in finance are built for publicly traded company, with diversified marginal investors and observable market values for equity and debt. With private businesses, owners/potential buyers tend not to be diversified and there are no observable market values for equity and debt. In this session, I talk about how to overcome those challenges: Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/TotalBetaInPractice.pdf Total Beta dataset: http://www.stern.nyu.edu/~adamodar/pc/datasets/totalbeta.xls Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 1 hr 24 min

    Session 27: Value Enhancement

    In this class, we started by drawing a contrast between price and value enhancement. With value enhancement, we broke down value change into its component parts: changing cash flows from existing assets, changing growth rates by either reinvesting more or better, lengthening your growth period by creating or augmenting competitive advantages and lowering your cost of capital. We then used this framework to compute an expected value of control as a the product of the probability of changing the way a company is run and the value increase from that change (optimal - status quo value). This expected value of control allows us to explain why market prices for stocks rise when corporate governance improves, why voting shares usually trade at a premium over non-voting shares (and why they sometimes don’t). Slides: https://www.stern.nyu.edu/~adamodar/podcasts/valUGspr22/session27slides.pdf Post class test: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session27Atest.pdf Post class test solution: https://www.stern.nyu.edu/~adamodar/pdfiles/eqnotes/postclass/session27Asoln.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Saturday · 42 min

    Lessons from Leo: The Dark Side of Investment Conviction!

    If you have been reading the financial press or tracing social media, the story of Leo Aschenbrenner and the rise and fall of his hedge fund, Situational Awareness, has been widely covered, with different views on causes. I use the story of this fund, created to monetize Leo's vision of AI as an immensely successful disruption in the near term, to talk about investment conviction, words often used as positives, when talking about investing. I look at the continuum of conviction from absolute certainty to complete mush, as well as the forces that cause variations in conviction across investments as well as across investors. I then follow up and argue that conviction drives two major investment choices - the sizing of an investment and how much leverage you take, with stronger (weaker) conviction leading to more concentrated (more diversified) portfolios with higher (lower) leverage. I end the session by drawing three lessons from this story: (1) that investment actions (on concentration & leverage) that are out of sync with investment conviction is deadly, (2) that momentum is a force that can upend conviction and (3) that as investor, you will be better off trusting humble money over smart money. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/LessonsfromLeo.pdf Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Friday · 38 min

    Information Timing and Release: The Debate over Quarterly Reporting and Fed Guidance!

    In this session, I talk about two long-running stories in markets, the first relating to a SEC proposal to replace quarterly with semi-annual reporting for US firms and other to Kevin Warsh's (the new Fed chair) view that the Fed should speak less and provide less guidance. The common themes in both stories is that they remove "news" that the market has become to receiving and using to set prices, and the advocacy and opposition to both proposals share commonalities. Advocates for the changes argue that removing quarterly reporting will make makes less "short term" and that reducing Fed guidance will also reduce the gaming around Fed actions. Opponents to the changes point to the loss of information that markets can use to set prices, and increased volatility in markets. I see shades of grey. I do like access to quarterly reports in my investing, since they allow me to update my valuations more frequently, but I also believe that earnings reports have become bulky and filled with distractions. Rather than reducing the frequency of reporting, I would prefer slimmer reports that have less management guidance and prognostications. As for the Fed, I do think it is healthy for investors to step back from the post-2008 view of the Fed as an all-powerful institution that can set interest rates and alter the trajectory of the economy. Neither perception is based in reality, and a world where we see less and hear less from the Fed will be a healthier one. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/quarterly.pdf Blog post: Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Friday · 18 min

    Capital Structure (updated for January 2018)

    In this spreadsheet, I compute the cost of capital and firm value, at different debt ratios, with the intent of finding the optimal mix. It reflects the changes and constraints on debt in the 2017 tax reform act. Spreadsheet: http://www.stern.nyu.edu/~adamodar/pc/capstru2018.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Friday · 1 hr 29 min

    Session: Closing Session

    In this session, I use the findings from project analyses to review the entire class, from corporate governance to valuation. I close by going back to the big picture of corporate finance, presented in the first session, and check on whether the objectives of the class have been accomplished. Slides: https://www.stern.nyu.edu/~adamodar/pdfiles/cfovhds/ProjSumm22.pdf Summary of project findings: https://www.stern.nyu.edu/~adamodar/pc/cfanalysis/cfspr22.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Friday · 30 min

    Data Update 7 for 2018: Profits, Excess Returns and Value

    In this session, I first look at the profitability of publicly traded companies around the world, using a range of profit margins. I thin look at the returns that companies generate on their existing investments, using accounting returns, and compare them to the cost of capital with a singular question. Do companies generally earn more, about equal to or less than their cost of capital? I find that not only do 60% of all companies earn less than their cost of capital, the problem cuts across companies in different geographies, size classes and growth classes. Put simply, growth in most companies is a value destroyer. Slides: http://www.stern.nyu.edu/~adamodar/pdfiles/blog/dataupdate7for2018.pdf Blog Post: https://aswathdamodaran.blogspot.in/2018/01/january-2016-data-update-7-growth-and.html Spreadsheet: http://www.stern.nyu.edu/~adamodar/pc/returncalculator.xls Datasets: 1. Profit Margins, by sector (US): http://www.stern.nyu.edu/~adamodar/pc/datasets/margin.xls 2. Profit Margins, by sector (Global): http://www.stern.nyu.edu/~adamodar/pc/datasets/marginGlobal.xls 3. Excess Returns, by sector (US): http://www.stern.nyu.edu/~adamodar/pc/datasets/EVA.xls 4. Excess Returns, by sector (Global): http://www.stern.nyu.edu/~adamodar/pc/datasets/EVAGlobal.xls Paper Return on Capital, Return on Invested Capital and ROE: Measures and Implications (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1105499) Learn more about your ad choices. Visit megaphone.fm/adchoices

  • Friday · 43 min

    Country Risk: Determinants, Measures and Implications - The 2026 Edition

    Since 2008, every year, in addition to posting updated data on equity risk premiums, I have done two update papers each year. I write the first, on equity risk premiums, in March of each year, and the second, on country risk, in July. These papers are catch-all publications, reflecting everything that I know or have learned about each of these topics, mostly in the process of having to deal with them in corporate financial analysis and valuation. As a consequence, these are written for practitioners, not academics, and they are driven by pragmatism, not purity. My latest country risk update (for 2026) is now accessible and you can download the paper, if you are interested, at the link below: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7107638 In this session, I summarize the paper, starting with the drivers of country risk - politics, corruption, exposure to violence and the strength of the legal system - before moving on to measures of country risk - sovereign ratings and CDS spreads for default risk, country risk scores and country equity risk premiums. I also talk about how these country equity risk premiums come into play when valuing companies as well as in estimating project hurdle rates in corporate finance. I close with a discussion of currencies, and why done right, valuations should be currency invariant. Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/countryrisk2026.pdf Blog Post: https://aswathdamodaran.blogspot.com/2026/07/country-risk-drivers-measures-and.html Paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7107638 Data: 1. Country equity risk premiums: https://pages.stern.nyu.edu/~adamodar/pc/datasets/ctrypremJuly26.xlsx 2. Riskfree rates, based on expected inflation: https://pages.stern.nyu.edu/~adamodar/pc/blog/DiffInflationRiskfree26.xlsx Learn more about your ad choices. Visit megaphone.fm/adchoices

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