Recommended Reading for Buy Side Valuation

lib8023's picture
Rank: Monkey | 31

I'm trying to learn more about valuation and how it would be employed on the buy side.

I've looked some older posts, and noticed that Damodaran (On Valuation, The Little Book of Valuation, Investment Valuation), Rosenbaum (Investment Banking:...), and McKinsey are all common recommendations, but this might be more for the sell-side.

If you could only choose one for buy-side learning, which one would you choose?

Comments (13)

Nov 21, 2017

Rosenbaum is for IB monkeys, hardly something you want to mention at HF or AM interviews. For general guides on valuation, I have read McKinsey, Damodaran, and Financial statement analysis and security valuation by Penman and found McKinsey and Penman to be more interesting ones.
But really, you should start trading (or investing).

    • 1
Nov 22, 2017

Do you have any suggestions on learning about valuation as you start investing? Other than my retirement, I have started to personally invest in order to become more "invested" in companies I find interesting. I feel comfortable spending time understanding the businesses and thinking about different future outcomes, but then start feeling a little lost when I need to contextualize with valuation.

It's funny, some analysts discount the importance of valuations, others say since the multiple is 50% of the share price, you should spend 50% of your time on it.

    • 1
Nov 22, 2017

to me it's all just...an assumption. it's just about...if I were to word it, "just right enough" where it's not about the exact price, but just a sense in range of how much upside or downside. If we were all good at valuation, we'd be retired millionaires. I think of values given to companies just as..."fake values" being given. The books you've wrote will give you the basis and foundation you need. I'd maybe look at some others not based on just valuation.

    • 1
Nov 22, 2017

Interested as well.

Do references from professors or previous internships suffice?

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Nov 22, 2017

Quite easy. Beat your benchmark by whatever means necessary

Nov 22, 2017
bearing:

Quite easy. Beat your benchmark by whatever means necessary

Easier said huh......

Nov 22, 2017
bearing:

Quite easy. Beat your benchmark by whatever means necessary

Nov 22, 2017
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