A Consensus View: Q&A Guide to Financial Valuation 2016 edition
March 2016 PDF
James Hitchner, Jay Fishman, Shannon Pratt
In this new guide, Hitchner, Pratt, and Fishman answer the most important business valuation questions they’ve been asked over the years.
In A Consensus View Q&A Guide to Business Valuation, Jim Hitchner, Shannon Pratt, and Jay Fishman answer over 150 of the most important business valuation questions they’ve been asked over the years. Each year, new chapters will be added and existing chapters will be updated. The Q&A Guide is available in both print and digital formats.
“It is a great thing when three of the best-known and respected business appraisers in the nation get together to try to bring some consensus, general agreement, and guidance on major valuation issues of the day...It is a tremendous resource.”
-- Z. Christopher Mercer, ASA, CFA, ABAR, CEO, Mercer Capital, Memphis, Tennessee
Table of Contents
Chapter 1 Income Approach
General
Capitalized Cash Flow vs. Discounted Cash Flow Methods
Cash Flow vs. Income
Weighting Historical Earnings
Growth Rates
Capitalized Cash Flow Method
Direct to Equity vs. Invested Capital Methods
Discounted Cash Flow Method
Terminal Year Calculations
Chapter 2 Cost of Capital/Rates of Return
General
Risk-Free Rate
Equity Risk Premiums
Size Premiums
Betas
Industry Risk Premiums
Company-Specific Risk Premiums
Dr. Aswath Damodaran
Weighted Average Cost of Capital
Venture Capital Rates of Return
Duff & Phelps Data Summary
Duff & Phelps Case Study Applications (2014-2015)
Duff & Phelps and Morningstar/Ibbotson Applications (Pre-2014)
Chapter 3 Discounts and Premiums
Discounts for Lack of Marketability
Liquidity vs. Marketability
Restricted Stock Studies and Data
Pre-IPO Studies and Data
QMDM
Option Models
Control Premiums, Lack of Control, and Minority Discounts
Mergerstat Data
Supportability of Control Premiums
Double-Counting Control
Control of Minority Valuation Methods
50/50 Interests
Minority and Control in the Cash Flows
Chapter 4 Business Valuation Standards and Ethics
General
Comparability of U.S. Valuation Standards
AICPA SSVS VS Section 100, NACVA, and IBA
ASA and USPAP
Calculations including Opinions