Don’t Automatically Reject the Asset Approach for Going Concerns

Business Valuation UpdateVol. 26 No. 3
March 2020
valuation methods & approaches
asset approach, going concern, valuation approaches

Summary

Many valuation analysts immediately reject the asset-based approach for operating businesses, but this is a problem, say Robert Reilly and Weston Kirk, who are both with Willamette Management Associates. The method is rejected too often because analysts are not familiar enough with the asset approach or they have misconceptions about when (and when not) to apply it.