Christopher H. Volk

The Value Equation


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      Table of Contents

      1  Cover

      2  Title Page

      3  Copyright

      4  Dedication

      5  Preface

      6  Introduction

      7  Chapter 1: Free Enterprise and Wealth Creation In the Beginning Is the Idea Unicorn Likelihood Odds of Success The Six Variables Notes

      8  Chapter 2: Daymond John and the First Variable Accountants vs. Entrepreneurs Variable #1: Business Investment Note

      9  Chapter 3: The Capital Stack and Two More Variables The Right Side Other People's Money (OPM) Variables #2 and #3: Amount and Cost of OPM Cost of Capital vs. Cost of Equity Capital Stack Assembly Equity Sourcing Notes

      10  Chapter 4: Three More Variables and Voilà! Variable #4: Sales Variable #5: Operating Profit Margin Variable #6: Annual Maintenance Capital Expense Putting the Six Variables Together Gordon Growth Model Equity Valuation The Miracle of Compounding Dissecting Investment Returns

      11  Chapter 5: The Value Equation EVA and EMVA Making the V-Formula Even Simpler Solving for Other V-Formula Variables V-Formula Data Tables Note

      12  Chapter 6: Business Model Evaluation STORE Capital The FAANGs Notes

      13  Chapter 7: Pulling the Corporate Efficiency Levers Operating Efficiency (O) Asset Efficiency (A) Capital Efficiency (C) Six-Shot Economics Note

      14  Chapter 8: Choosing from Your OPM Options Designing Your Own OPM Leasing Creating a Model to Evaluate OPM Options Real Estate as an Investment Note

      15  Chapter 9: Opportunity Cost Some Opportunity Cost Illustrations Creating a Model to Evaluate Real Estate Lease Opportunity Costs

      16  Chapter 10: The Final Form of OPM OPM Equity Sustainable Growth Rate Taking on OPM Equity Deciding How Much OPM Equity to Use Creating a Five-Year Model Sweetening the Deal OPM Equity Flavors OPM Equity Considerations Note

      17  Chapter 11: A Look at Public Companies Determining Public Stock Equity Returns Walmart Note