Business Valuation Update
- How to Review a Report’s Valuation Methodology
- Ideas for Solving Two Problems in the BV Profession
- How Do Your Firm’s Benefits Stack Up?
- Using Rule of Thumb Data to Uncover Cooked Books
Musings on the Cost of Capital
A veteran appraiser presents an interesting retrospective on the cost of capital and offers some observations on current practice.
Estimating the Extra Risk of Customer Concentration
Interesting comments were made by Roger Grabowski (Kroll), who conducted a session at the American Society of Appraisers International Conference. He discusses the research in this area and how to examine the customer concentration of guideline public companies.
Two Articles Addressing Firm Quality and Its Impact on the Size Effect
The authors discuss two recent papers that present the concept of firms’ quality and show that it plays an important role in understanding the size effect. Also discussed are papers that present a differing view.
COE Estimates From Leading Data Sets Are All ‘Very Close’
Jim Hitchner conducted a hypothetical engagement using Kroll’s Navigator, BVR’s Cost of Capital Professional, the Pepperdine study, and Damodaran’s data to estimate cost of equity (COE).
BVU News and Trends May 2020
A monthly roundup of key developments of interest to business valuation experts.
Lost Profits Turn on Risk-Free vs. Risk-Adjusted Discount Rates
Bankruptcy court examines forecasts of future performance, discount rates in determination of lost profits.
Hitchner Updates the Risk/Return Spectrum for Cost of Capital
A good visual to use for checking the reasonableness of your cost of capital estimate is the spectrum of rates in the market. Jim Hitchner (Financial Valuation Advisors Inc.) has done an update to this spectrum, which can be used in valuation reports and in court.
BVU News and Trends September 2020
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends April 2024
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends October 2020
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends September 2021
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends March 2022
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends April 2023
A monthly roundup of key developments of interest to business valuation experts.
Concerns Over Data Security in Online Cost of Capital Tools
Business Valuation Update attended the recent NYSSCPA business valuation conference in New York City where several attendees expressed concerns about entering sensitive client data into online tools for estimating the cost of capital. The providers of the Duff & Phelps Cost of Capital Navigator and BVR’s Cost of Capital Professional respond to these concerns.
Is Your Cost of Capital Data Backing You Into a Corner?
In a recent court case, the valuation expert tried to use professional judgment but the data being used did not support her opinion. The expert could not adequately explain why she chose not to go where the data led her.
BVU News and Trends October 2019
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends August 2023
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends December 2022
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends July 2020
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends May 2019
A monthly roundup of key developments of interest to business valuation experts.
BV News and Trends June 2023
A monthly roundup of key developments of interest to business valuation experts.
New Country Risk Data Update Reminds Valuers of Factors to Consider
A data update from Aswath Damodaran (New York University Stern School of Business) helps valuation experts explain how they considered each of the risk factors in assessing value for business assets located outside of the U.S.
BVU News and Trends January 2021
A monthly roundup of key developments of interest to business valuation experts.
Response to Eric Nath’s Comments on the Cost of Capital Professional
Comments in response to the need to develop a “truly forward-looking required rate of return system that gives appraisers an understanding of how to estimate cost of capital for private companies and interests in private companies.”
No End in Sight to Size Effect Debate
A look at several recent articles on the so-called size premium that perpetuate the debate on this topic. Some appraisers feel that the size effect has diminished or disappeared since it was first documented in 1981, while others feel it is alive and well.