FYI:
Regards,
Ted
Corporate executives are often expected to be talented stockpickers who buy promising businesses to add to their own.
This is hard to do well, and it often goes badly. A new study by Matthew Shaffer, a doctoral candidate at Harvard Business School, suggests independent valuation experts can provide limited, but useful, guidance.
As long as a listed company is independent, its “fair” value is simply its market price. That is not much help to an executive hunting for deals, however, since a business’s value can change depending on who owns it. Superior management can create value that didn’t previously exist.
