Strategic implications of valuation methods

Author's OriginalStrategy is ultimately aimed at creating shareholder value, placing valuation in a central role linking finance and strategy. Focusing on growth options, this paper uses a unique "perfect information" model to examine, from a strategy point of view, the relationship between the market value of the firm and its intrinsic, or DCF, value. Although the research is at the level of the firm, the results have implications at the level of individual strategies and projects, since a firm can be conceptualized as a collection of projects. The findings highlight the relationship between the value of growth options and macroeconomic conditions, industry characteristics, and firm-specific factors. A revised version of this paper has since been published in the journal Advances in Strategic Management. Please use this version in your citations.Alessandri, T. M., Lander, D. M., & Bettis, R. A. (2007), Strategic Implications of Valuation: Evidence from Valuing Growth Options, in Professor Brian Silverman (ed.) Real Options Theory. Advances in Strategic Management, 24, 459-48

Evidence for widespread hydrated minerals on asteroid (101955) Bennu

Early spectral data from the Origins, Spectral Interpretation, Resource Identification, and Security-Regolith Explorer (OSIRIS-REx) mission reveal evidence for abundant hydrated minerals on the surface of near-Earth asteroid (101955) Bennu in the form of a near-infrared absorption near 2.7 µm and thermal infrared spectral features that are most similar to those of aqueously altered CM-type carbonaceous chondrites. We observe these spectral features across the surface of Bennu, and there is no evidence of substantial rotational variability at the spatial scales of tens to hundreds of metres observed to date. In the visible and near-infrared (0.4 to 2.4 µm) Bennu’s spectrum appears featureless and with a blue (negative) slope, confirming previous ground-based observations. Bennu may represent a class of objects that could have brought volatiles and organic chemistry to Earth

The dynamic geophysical environment of (101955) Bennu based on OSIRIS-REx measurements

The top-shaped morphology characteristic of asteroid (101955) Bennu, often found among fast-spinning asteroids and binary asteroid primaries, may have contributed substantially to binary asteroid formation. Yet a detailed geophysical analysis of this morphology for a fast-spinning asteroid has not been possible prior to the Origins, Spectral Interpretation, Resource Identification, and Security-Regolith Explorer (OSIRIS-REx) mission. Combining the measured Bennu mass and shape obtained during the Preliminary Survey phase of the OSIRIS-REx mission, we find a notable transition in Bennu’s surface slopes within its rotational Roche lobe, defined as the region where material is energetically trapped to the surface. As the intersection of the rotational Roche lobe with Bennu’s surface has been most recently migrating towards its equator (given Bennu’s increasing spin rate), we infer that Bennu’s surface slopes have been changing across its surface within the last million years. We also find evidence for substantial density heterogeneity within this body, suggesting that its interior is a mixture of voids and boulders. The presence of such heterogeneity and Bennu’s top shape are consistent with spin-induced failure at some point in its past, although the manner of its failure cannot yet be determined. Future measurements by the OSIRIS-REx spacecraft will provide insight into and may resolve questions regarding the formation and evolution of Bennu’s top-shape morphology and its link to the formation of binary asteroids

Lawson criterion for ignition exceeded in an inertial fusion experiment

For more than half a century, researchers around the world have been engaged in attempts to achieve fusion ignition as a proof of principle of various fusion concepts. Following the Lawson criterion, an ignited plasma is one where the fusion heating power is high enough to overcome all the physical processes that cool the fusion plasma, creating a positive thermodynamic feedback loop with rapidly increasing temperature. In inertially confined fusion, ignition is a state where the fusion plasma can begin "burn propagation" into surrounding cold fuel, enabling the possibility of high energy gain. While "scientific breakeven" (i.e., unity target gain) has not yet been achieved (here target gain is 0.72, 1.37 MJ of fusion for 1.92 MJ of laser energy), this Letter reports the first controlled fusion experiment, using laser indirect drive, on the National Ignition Facility to produce capsule gain (here 5.8) and reach ignition by nine different formulations of the Lawson criterion

Finishing the euchromatic sequence of the human genome

The sequence of the human genome encodes the genetic instructions for human physiology, as well as rich information about human evolution. In 2001, the International Human Genome Sequencing Consortium reported a draft sequence of the euchromatic portion of the human genome. Since then, the international collaboration has worked to convert this draft into a genome sequence with high accuracy and nearly complete coverage. Here, we report the result of this finishing process. The current genome sequence (Build 35) contains 2.85 billion nucleotides interrupted by only 341 gaps. It covers ∼99% of the euchromatic genome and is accurate to an error rate of ∼1 event per 100,000 bases. Many of the remaining euchromatic gaps are associated with segmental duplications and will require focused work with new methods. The near-complete sequence, the first for a vertebrate, greatly improves the precision of biological analyses of the human genome including studies of gene number, birth and death. Notably, the human enome seems to encode only 20,000-25,000 protein-coding genes. The genome sequence reported here should serve as a firm foundation for biomedical research in the decades ahead

Investment in new foreign subsidiaries under receding perception of uncertainty

Research on foreign direct investment has focused considerable attention on the moment of market entry, but less on the dynamics of investment in the post-entry phase. This paper centres the influence of uncertainty on investment, and develops a growth options model to explain the sequence of investment in new foreign subsidiaries. In a learning process that starts at entry, investors perceive receding levels of uncertainty and shift their reason for investment from option values towards net present values. The findings of a panel study of 634 German subsidiaries support the propositions and reveal the potential of the real options approach to improve the understanding of internationalisation processes. Journal of International Business Studies (2008) 39, 370–386. doi:10.1057/palgrave.jibs.8400362