Michael Mauboussin: Reclassifying Cash Flow Items Provides Investors With Greater Insights

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In his latest paper titled – Categorizing for Clarity, Michael Mauboussin shows how reclassifying certain items in the cash flow statement can substantially improve the description of a business, without impacting the integrity of the cash flow statement. Here’s an excerpt from the paper: Understanding the magnitude and prospective return … Read More

Michael Mauboussin: Everything Is a DCF Model

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In his latest paper titled – Everything Is A DCF Model, Michael Mauboussin discusses DCF models, and why they still remain relevant today. Here’s an excerpt from the paper: A Mantra for Valuing Cash-Generating Assets We suggest the mantra “everything is a DCF model.” Whenever investors value a stake in … Read More

Michael Mauboussin: The Economics of Customer Businesses

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In his latest paper titled – The Economics of Customer Businesses, Calculating Customer-Based Corporate Valuation, Michael Mauboussin discusses a robust framework called ‘customer based corporate valuation’ (CBCV), which was developed by professors of marketing, Daniel McCarthy and Peter Fader, that links customer economics to corporate value. This allows investors to … Read More

Michael Mauboussin: Animating Mr Market

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Some years ago, Michael Mauboussin wrote a paper titled Animating Mr Market, in which he discussed Ben Graham’s Mr Market metaphor saying, “One way to animate Mr. Market is to consider the wisdom of crowds. What’s key is that crowds are wise under some conditions and mad when any of … Read More

Michael Mauboussin: Why Companies Die

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Several years ago, Michael Mauboussin and his colleagues wrote a great paper titled – Corporate Longevity – Index Turnover and Corporate Performance, which provides some great insights on why some companies manage to successfully survive over time while others capitulate. Here’s an excerpt from the paper: Why Companies Die Imagine … Read More

Michael Mauboussin: One Job: Expectations and the Role of Intangible Investments

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Michael Mauboussin recently released a paper titled – One Job: Expectations and the Role of Intangible Investments in which he discusses the impact of intangibles in company valuation. The paper focuses on three aspects of intangibles – measurement, characteristics, and the implications for investors. Here’s an excerpt from the paper: … Read More