Harvard Business Review

AUGUST 3, 2018

On June 25, 2018, Facebook lost market capitalization of more than $100 billion in just two hours of trading after it announced its quarterly performance, despite exceeding analysts’ earnings forecasts. This example illustrates that investors consider information beyond just earnings as value-relevant. What caused this slump?

Report 8

Report GAAP Company Proposal 8

Harvard Business Review

DECEMBER 1, 2011

A firm's long-term value should correspond to the present value of future expected cash flows. It apparently takes a courageous and confident board member to second-guess the market! These short-term decisions have the potential to destroy long-term value.

Short-term 14

Short-term Hostile Takeover Long-term Management 14

Strategy Driven

SEPTEMBER 9, 2011

Many conventional metrics we use to estimate value are based on faulty assumptions. Net present value [NPV] is a case in point. The logic of NPV is to project cash flows into the future and then discount those flows back into today’s dollars at a given cost of capital.

Innovation 50

Innovation NPV Business Model Constraint 50