While Arzac and Glosten (2005) affirm that "the value of tax shields depends upon the nature of the equity stochastic process, which, in turn, depends upon the free cash flow process," I prove that the value of tax shields depends only upon the nature of the stochastic process of the net...

We compute the correlations of the annual stock returns (1989-2008) of the Dow Jones companies with a) Rm; and with b) Rm; and find that the second correlation (assuming beta = 1 for all companies) is higher than the first one, on average, and for all companies except Caterpillar and General...

En este documento se analizan dos empresas con actividades muy similares: Boston Chicken, una cadena de más de 1.700 restaurantes especializados en comida casera, y TelePizza, una cadena de más de 700 pizzerías. Ambas crecieron mucho en la década de los noventa y tuvieron un período de...

The value of tax shields depends only on the nature of the stochastic process of the net increases of debt. The value of tax shields in a world with no leverage cost is the tax rate times the current debt plus the present value of the net increases of debt. By applying this formula to specific...

This paper is a review of the recommendations about the equity premium found in the main finance and valuation textbooks. We review several editions of books written by authors such as Brealey and Myers; Copeland, Koller and Murrin (McKinsey); Ross, Westerfield and Jaffe; Bodie, Kane and Marcus;...

We develop valuation formulae for a company that maintains a fixed book-value leverage ratio and claim that it is more realistic than to assume, as Miles-Ezzell (1980) do, a fixed market-value leverage ratio. The value of tax shields depends only on the present value of the net increases of...

La rentabilidad media de los fondos de inversión en renta variable nacional durante los tres, cinco, diez y quince últimos años fue inferior a la del ITBM (Indice Total de la Bolsa de Madrid) en más de un 6%. De los 43 fondos con diez años de historia, sólo uno (Bestinver Bolsa, que hizo...

In a recent paper, Cooper and Nyborg (2004) argue that the results of Fernández (2004) are wrong because value-additivity is violated and because "Fernández paper comes from mixing the Miles-Ezzell leverage policy with the Miller-Modigliani leverage adjustment." Cooper and Nyborg's paper is...

En este documento se cuantifica la creación de valor para los accionistas del Santander (SAN), del BBVA, del Banco Popular (POP) y de Bankinter (BKT) entre diciembre de 1991 y diciembre de 2006. En ese periodo, el aumento de la capitalización (en millardos de euros) fue: SAN 85,7; BBVA 61; POP...