is there a difference between corporate finance and valuations?

Valuation does not necessarily mean finding the intrinsic value (unless you are referring only to DCF) as there are other methods of valuing something (i.e. transaction/public comps, which measure value on a relative basis).

I would recommend ScoopBooks for Corp. Fin and Valuation

That's what I thought too (parts and whole). Would studying the Ross, Westerfield, and Jordan corporate finance textbook be enough in prepping for technical interviews, you guys think?

Wouldn't even go that far. For a non-finance background, the Vault guide should be enough.

vault guide is horrendous....

if you're interested in finance, why take a (terrible) shortcut to learning about it, even if it is just for interviews?

if there really is not much difference, why does Damodaran have an entire section dedicated to corporate finance and then another whole section dedicated to valuations alone?

which section is more relevant to ibd interviewing? thanks!

Is still an attempt to ultimately determine how comfortable you are with an intrinsic value. While you're right, any banker can throw you the EBITDA multiples for deals in an industry (Paper industry deals go for 4x, or something like that).

Theoretically, DCF is the only valuation technique you'd ever need. Obviously, half the assumptions we make in cash flow and opportunity cost projections are ridiculous/worthless because they change so fast, that we turn to comparisons. Relative valuation is still a piece of the puzzle to determine intrinsic value, you don't just look up similar deals or competitors just to believe the industry has and always will trade at some kind benchmark. There are certain assumptions you make, and I don't mean about the comps. Let's say you have some perfect comparables. You're still faced with questions of market effeciency, and whether the entire industry is "over/under valued". Relative valuation is a reinforcement of one's investment thesis, not proof alone. Vinod Khosla sums up this point well (paraphrasing here from a talk he gave at Stanford, it's online and worth hearing if energy topics interest you): "Valuations in VC are basically educated people making up numbers for company values. We look at similar transactions, but no transaction is similar at all. We (partners) add value by using our guts to estimate the firm's intrinsic value. Looking at what other people did/have done: that's fine, and bubbles/stupidly/over/under priced deals might be interesting to consider if you're a genius and you can sort out all those problems to get a real idea of at what multiples deals are done, but at the end of the day, it's how much you believe the company is worth. Only time can tell you if you're right."

If you only think transaction comps/ comp competitors are used, you inherently have to assume that you're too dumb to add value (as an entity), and that "It's not about getting the right price, but finding someone dumb enough to buy". The sucker fallacy is what screws over companies more often that not. How many banks live by this policy? I gues that's up to you to decide.

very good explanation alphaholic. just wondering for interviews if you guys would recommend damodaran on valuation (which I assume to be fully about ibanking valuations) vs something like principles of corporate finance (which i assume would talk a lot more general stuff like capital budgeting, etc).