Home Videos Aswath Damodaran: Estimating An Optimal Debt Ratio – Peer Group Or Me Too Capital Structure

Aswath Damodaran: Estimating An Optimal Debt Ratio – Peer Group Or Me Too Capital Structure

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Most companies decide how much to borrow by looking at what other companies in the peer group are borrowing, with both the peer group and the debt metric set by what others are doing. In this session, I look at this approach to setting debt ratios and how to tweak it to allow for differences across companies.

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