NEWSLETTER of October 11, 2024
The following content has been added at finexpert:
Studies > Corporate Finance
Deloitte
NON-PERFORMING LOANS MARKETBEAT
The NPL Marketbeat is aimed at investors, financial institutions and market participants who want to make informed decisions in the area of non-performing loans. It provides useful and comprehensive information to understand and strategically respond to current market conditions. The study focuses on the effects of economic uncertainty and the impact of changes on the NPL market in the real estate sector. >more
Studies > Corporate Finance
Bain & Company
A CFO’S BEST DEFENSE AGAINST ACTIVIST INVESTORS? THINK LIKE THEM
Activist investor campaigns are growing and increasingly targeting large-cap companies. Bain's survey of CFOs found that half of them had already been a target or expected to face activist action within two years. Understanding and thinking like investors can help CFOs preemptively address their concerns. Companies with a strong strategy focused on industry leadership, coupled with appropriate capital allocation plans, strong execution, and clear communications, are less likely to be targeted. >more
Studies > Macro
J.P. Morgan
GUIDE TO THE MARKETS: EUROPE Q4 2024
The J.P. Morgan Guide to the Markets is a comprehensive quarterly white paper that provides a detailed analysis of global economic, market, and investment trends. It covers a wide range of topics, including equity markets, fixed income, interest rates, inflation, and economic growth, offering data-driven insights to help investors understand current conditions and make informed decisions. The guide is designed to break down complex market data into easily digestible charts and graphs, making it a valuable resource for financial advisors, institutional investors, and individual investors alike. >more
Studies > Macro
KfW Research
MITTELSTAND SIEHT WACHSENDE RISIKEN FÜR SEINE INTERNATIONALE WETTBEWERBSFÄHIGKEIT
Around one in ten German SMEs face international competition in their domestic and foreign sales markets. Many of them continue to rate their international competitiveness as high, as the results of a special survey for the KfW SME Panel in April 2024 show. However, there is also a smaller proportion of companies that are lagging behind their foreign competitors. The outlook for the future competitive position has deteriorated noticeably since March 2023 and concerns about Germany as a business location have increased significantly. Bureaucracy remains the biggest challenge from the perspective of SMEs. >more
Research Papers > Corporate Finance
EMPIRICAL DETERMINANTS OF MOMENTUM: A PERSPECTIVE FROM INTERNATIONAL DATA
Amit Goyal, Narasimhan Jegadeesh, and Avanidhar Subrahmanyam
2024
We use out-of-sample international data to consider U.S.-based empirical proxies for momentum explanations. We find that the proxy for the hypothesis that investor underreaction to information arriving in small bits rather than in large chunks results in momentum receives reliable support internationally. The market/book ratio as a proxy for valuation uncertainty, and potentially for investor overconfidence as well, receives secondary support, but we find no support for real options proxies. We confirm out-of-sample that momentum is stronger in up-markets and less-volatile markets; these market states represent high investor confidence in the original studies. >more
Research Papers > Corporate Valuation
INTRINSIC VALUE: A SOLUTION TO THE DECLINING PERFORMANCE OF VALUE STRATEGIES
Derek Bergen, Francesco A. Franzoni, Daniel Obrycki, and Rafael Resendes
2024
The paper proposes to use intrinsic value as an alternative measure of fundamentals in predicting stock returns. We construct intrinsic value as the sum of the book value of equity and the present value of future economic profits. The CAPM alpha of a long-short portfolio of large stocks based on the intrinsic-value-to-market ratio is 56 bps per month between 1999 and 2023 when the book-to-market ratio and similarly constructed price multiples fail to predict returns. Given the low turnover of the strategy, accounting for transaction costs has a marginal impact on its net alpha. We argue that the underperformance of strategies based on traditional valuation multiples stems from their failure to model future economic profits, which matter the most in low discount rate environments. >more