Session 10: FCFE across the life cycle and Growth Rate Estimation

Published: 27 February 2023
on channel: Aswath Damodaran
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In this session, we started by completing our discussion of FCFE and how it varies over a corporate life cycle, and then looked at three approaches to estimating growth - a historical growth rate, where you look at past growth, outsourcing growth to analysts or managers and sustainable growth, where you tie growth to how much a company is reinvesting and how well it is reinvesting. Ultimately, you have to find the right mix of historical data, industry trends and your assessment of the company in forecasting growth, and letting uncertainty stop you is not an option.
Start of the class test: https://pages.stern.nyu.edu/~adamodar...
Slides: https://pages.stern.nyu.edu/~adamodar...
Post class test: https://pages.stern.nyu.edu/~adamodar...
Post class test: https://pages.stern.nyu.edu/~adamodar...


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