MoreNotesToSelf

Technology, Finance, and Life

Trefis decomposes stock price

Posted by DK on November 17, 2009

via TechCrunch:

Started by three engineers and math whizzes from MIT and Cornell (Manish Jhunjhunwala, Adam Donovan, and Cem Ozkaynak) who did time at McKinsey and UBS bank, Trefis breaks down a stock price by the contribution of a company’s major products and businesses. For instance, 51.3 percent of Apple’s stock price is attributed to the iPhone, 25.5 percent to the Macintosh, and only 7.7 percent to iTunes and iPhone apps. Don’t agree? You can change the underlying assumptions by simply dragging lines on charts forecasting the future price of the iPhone, its market share going out to 2016, and so forth. Every time you change an assumption, the price target changes accordingly.

So let’s take a company we all love to hate, AT&T. The screenshot above shows how Trefis decomposes the company’s stock price. You can click through to get a more in-depth breakdown of AT&T’s business. There’s also a social component to the service where subscribers can contribute their own customized models.

There aren’t that many companies to choose from, but Trefis is still in the free period. I imagine users will have to pay for full access in the future. In any case, it seems like a neat toy.

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