Business Valuation
Preparation of independent, professional Business Valuations based on international standards, calculation and derivation of company value through ROI calculations and sensitivity analysis. M&A World distinguishes between three widely known and accepted valuation methods:income-based (discounted cash flow), market comparison (multiples) and asset-based valuation methods.
- Discounted Cash-flow: The income-based methodology is one of the most widespread and recognized methods of traditional company valuation. In DCF valuation, projected future cash-flows of an asset or company are discounted back at a discount rate(WACC), that reflects the perceived riskiness of these cash-flows. EnterpriseValue (the ”EV”) of a company is the sum of the present values of future cashflows, which the company generates during its entire life-cycle. The DCF method is particularly successful for companies that operate in a stable environment and are in a mature stage.
- Multiplier: InComparable Transactions Valuation, the price range of the analyzed company is estimated by factoring the valuation multiples paid in the acquisition of similar companies recently. The multiplier method is successful in case the examined Company's profile, size, level of profitability are similar to the comparable ones and it is easy to find comparable recent transactions in the market.
- Asset Valuation: The aim of the Company’s asset-based valuation is to calculate the shareholders’ equity value from the estimated market value of its tradable assets reduced by the liabilities. A multiple was used between the book value and the market value of each assets or asset groups on the basis of publicly available online trading information. The methodology is based on there valuation each balance sheet items. Asset valuation is recommended for companies whose profit-generating capacity falls short of the net value of their assets, and is also suitable for non-marketable investments.
In order to get the most accurate picture of the fair value of the company, in thisAssessment, M&A World derives the value of the company based on all three methodologies.