Finding Value in Numbers

Ehsan Ehsani is an adjunct professor in the finance division at Columbia Business School and an investor at an activist and value-oriented firm in New York. He holds an MBA from Columbia Business School, along with master’s degrees from the MIT-Zaragoza International Logistics Program and Chalmers University of Technology in Sweden.Mario Gabelli is the chairman and chief executive officer of GAMCO Investors, Inc.

• Writer’s NoteForeword, by Mario J. GabelliBackground: Setting the StageYou Need to Have a FrameworkPart I. Is the Idea Investible?1. What Does “Investible” Mean?2. Return on Invested Capital3. Calculating Return on Invested Capital: Special Scenarios4. A Value Investor’s Guide to Economic Value Added5. Other Useful EVA-Based Indicators6. Revisiting ROIC Adjustments7. Marginal ROIC and Other Commentary8. Unit Economics9. Owner EarningsPart II. Is the Valuation Attractive?10. An Alternative Perspective on Valuation11. Value of Growth12. Considerations in Value of Growth13. A Note on Cost of Capital14. TAM Analysis15. Value of Intangible Assets16. Integrating Intangibles Into Business ValuationPart III. Is There a Path to Profits?17. Catalysts and Levers for Repricing18. Risk Arbitrage19. Value Across Capital Structure20. Discovering Opportunities in Less Common Securities21. Short SellingPart IV. Do We Have a Winning Gameplan?22. A Few Easy Internal Rate of Return Calculations23. Key Portfolio Decisions24. Pursuing Value in a Complex World25. Coming Full CircleAcknowledgmentsNotesIndex

What separates a good investor from a great one isn’t genius—it’s clarity of thought and a framework that withstands uncertainty. This book will arm curious MBA students and professional investors with quantitative tools and mental models to accomplish an analyst’s most essential task: determining the gap between price and value. If you want to develop your own framework for security valuation, start here.