Why do conflicts in business valuation arise? When business owners don’t see eye to eye they may be tempted to part company and go their separate ways. Naturally, they would want to be compensated for their share of the business. And this creates the need for a business to be appraised. If the dispute is… Continue Reading
The post Conflicts in business valuation appeared first on ValuAdder Business Valuation Blog.
Ask any appraiser about the ways to figure out the value of an asset or a business. You will hear that there are only three ways to do this. You may be surprised that all these smart people managed to come up with is just three approaches to valuation. Yet this is true, only three… Continue Reading
The post Approaches to value in a nutshell appeared first on ValuAdder Business Valuation Blog.
Companies in different industry sectors often bear little resemblance to each other. Consider a professional advisory firm and a sporting equipment retailer. So does business valuation by industry follow different rules? The short answer is no. Business valuation methods remain the same regardless of the industry your company operates in. You need to estimate the… Continue Reading
The post Does business valuation differ by industry? appeared first on ValuAdder Business Valuation Blog.
Business valuation is the process of estimating the economic worth of a company. Business people get valuations for a number of reasons, such as mergers and acquisitions, taxation, litigation, and strategic planning. While business valuation relies on a lot of math for analysis, is not an exact science. In fact, it is an area of… Continue Reading
The post Choose business appraisers over AI bots appeared first on ValuAdder Business Valuation Blog.
Just about any valuation project is likely to involve the discounted cash flow method. The company value is estimated based on its expected future cash flows and risk. You can use the discounted cash flow analysis to value not just businesses but other income producing assets such as stocks, real estate, projects and much more.… Continue Reading
The post Discounted cash flow method – pros and cons appeared first on ValuAdder Business Valuation Blog.
Businesses recognize the value of contracts if they offer advantages in terms of lower operating expenses, competitive position, or critical asset retention for some period of time. Consider the important types often seen in successful companies: Leases of business premises. Supplier and other vendor agreements. Employment contracts with key staff members. Licensing rights. Franchise agreements.… Continue Reading
The post Business value of contracts appeared first on ValuAdder Business Valuation Blog.
When business appraisals come under the scrutiny of courts, lawyers on both sides reach out to appraisers to testify as expert witnesses. Who gets selected? Usually, attorneys tend to pick the professionals who offered such expert opinions in court before. But how does an appraiser get selected for the first time? Clearly, an attorney decides… Continue Reading
The post Expert witnesses appeared first on ValuAdder Business Valuation Blog.
Choosing the appropriate earnings basis for your business valuation is key. One choice made by professionals is the Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). However, like any tool, it has its pros and cons, which merit careful consideration. Some points: Pros Normalization of Earnings and Expenses Adjusted EBITDA allows for the normalization… Continue Reading
The post Pros and Cons of Adjusted EBITDA in valuations appeared first on ValuAdder Business Valuation Blog.
You can use business valuation for various transactions, including mergers and acquisitions, investment decisions, and even internal assessments of the company’s value. Among the methods employed in business valuation, revenue multiples have gained popularity for their simplicity and accessibility. However, while revenue multiples can offer you quick insights, relying solely on them can lead to… Continue Reading
The post Revenue Multiples Can Mislead appeared first on ValuAdder Business Valuation Blog.
For a company a key measure of success is its ability to create a steady and predictable income. In other words, the business must generate desired returns for its owners given an acceptable level of risk. No other business valuation method captures this idea better than the discounted cash flow valuation method. What is Linear… Continue Reading
The post Automating Financial Forecasts with Linear Regression appeared first on ValuAdder Business Valuation Blog.