Quotes from Aswath Damodaran

Growth requires reinvestment.

Einstein was right about relativity, but even he would have had a difficult time applying relative valuation in today's stock markets.

I am naturally drawn to numbers but one of the ironies of working with numbers is that the more I work with them, the more skeptical I become about purely number-driven arguments.

A firm can have value only if it ultimately delivers earnings.

Avoid companies that are cavalier about issuing new options to managers

The intrinsic value of an asset is determined by the cash flows you expect that asset to generate over its life and how uncertain you feel about these cash flows.

Growth firms get more of their value from investments that they expect to make in the future and less from investments already made.

Success in investing comes not from being right but from being wrong less often than everyone else.

In the intrinsic valuation chapter, we observed that the value of a firm is a function of three variables—its capacity to generate cash flows, its expected growth in these cash flows, and the uncertainty associated with these cash flows.

Do not be afraid to make mistakes.

We relate to and remember stories better than we do numbers, but storytelling can lead us into fantasyland quickly

valuation that is not backed up by a story is both soulless and untrustworthy and that we remember stories better than spreadsheets.

pero si compras un activo financiero lo haces por los flujos de caja que esperas recibir.

Kahneman notes in his book on investor psychology, experience is not a very good teacher in investing and markets. 2 As human beings, we often extract the wrong lessons from past successes, don't learn enough from our failures, and sometimes delude ourselves into remembering things that never happened.

When a company is paying out more in dividends, it is retaining less in earnings; the book value of equity increases by the retained earnings.

we are increasingly using the Internet as an external hard drive for our memories.

The right price: Great growth companies can be bad investments at the wrong price. While multiples such as PEG ratios have their limitations, use them (low PEG ratios) to screen for companies that are cheap.

in the hands of a skilled number cruncher, this bias can be hidden far better with numbers than with stories.

As I see it, the future of investing belongs to those who are flexible in their thinking and capable of moving easily from one segment of the market to another.