About this channel
Aswath Damodaran's channel approaches markets through valuation, investment reasoning and the relationship between a business story and its numbers. Interest rates, company listings, country risk and…
Aswath Damodaran's channel approaches markets through valuation, investment reasoning and the relationship between a business story and its numbers. Interest rates, company listings, country risk and the economics of growth all feature in its analytical topics. The material is concerned with how investors arrive at a judgment, including the assumptions that become more difficult to examine when enthusiasm or conviction is strong.
A sequence on SpaceX considers the valuation questions surrounding a flotation and the information available in a prospectus. Another episode uses AI as a setting for moving from excitement about technology to questions about the underlying business. The tension between scaling and profitability brings a related issue into venture capital: how growth ambitions interact with the ability to build an economically sustainable company. These examples connect prominent market stories with recurring problems in assessing value.
Viewers interested in investment analysis can use the channel to think through frameworks rather than just follow a market reaction. Discussions of country risk and the relationship between interest rates and share prices provide broader context, while episodes on conviction and investment philosophy turn attention to the investor's own habits. The titles suggest topic-led explanations and arguments that invite close attention to reasoning, making the channel relevant to learners as well as people already accustomed to financial analysis.
Other subjects include the timing of corporate reporting, central bank guidance and the question of which companies belong in a major index. Together, they widen the focus from valuing an individual company to the information and institutions around that exercise. Across the material, business narratives remain important, but so does asking what evidence and assumptions are required to turn a narrative into an investment judgment.
Latest episode
Earnings, Cashflows and Stock Prices: The AI Storm blows through!
The key reason that US equities have held their own this year, in the face of rising interest rates, is a surge in aggregated earnings, which some have attributed to the massive investments in AI cap…
The key reason that US equities have held their own this year, in the face of rising interest rates, is a surge in aggregated earnings, which some have attributed to the massive investments in AI cap ex. In this session, I start by updating my market views to October 1, by bringing in September's explosive rise in rates and updating my estimates for expected returns and equity risk premiums for US stocks. I then turn to the real focus of this session, which is looking at how the trillions being invested in AI cap ex are playing through income statements, balance sheets and cash flows for the AI builders (who are spending the money on the AI cap ex) and the suppliers of the AI architecture (chips, networking equipment, power, cooling and real estate. Across all publicly traded firms, AI cap ex has significantly bulked up balance sheets, with both book debt and equity rising, and at least in the aggregate, increased earnings, as the amortization of AI cap at the builders (which lowers earnings) is being swamped by the net income generated by the AI suppliers, from providing the ingredients. In the aggregate, US companies are generating less in free cash flows, and dividends and buybacks are growing far more slowly than earnings. I close with an assessment of the choices we face as investors, as the AI storm roils the waters.
Slides: https://pages.stern.nyu.edu/~adamodar/pdfiles/blog/MktandAI2026.pdf
Blog post: https://aswathdamodaran.blogspot.com/2026/10/stock-prices-earnings-and-cashflows-ai.html
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Corporate Finance Class (Spring 2015)
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More episodes from this channel
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