Valuation will always be both an art and a science. This
book will help you master both the science and the art.
Concise, realistic, and easy to use, it brings together the
field's best "rules of thumb," helps you compare every key
approach, and offers practical solutions for your most
important valuation challenges.
Leading practitioners Kenneth R. Ferris and Barbara S.
Pécherot Petitt review the entire valuation process,
offering real-world advice for both acquiring and valuing
target companies. Next, they cover each of today's most
important valuation techniques, including discounted cash
flow analysis, earnings multiples analysis, adjusted
present value analysis, economic value analysis, and real
option analysis, as well as such related concerns as the
accounting structure of a deal, accounting for goodwill,
and much more.
From traditional ROE analysis to the latest reporting
and tax issues, this book doesn't just make valuation
comprehensible: it gives you the tools and insight you need
to make valuation work.
Hands-on advice for acquiring
and valuing target companies
- Avoiding the process errors that lead to inaccurate
valuation
Examples and case studies from a wide variety of industries
- Pharmaceuticals, manufacturing, chemicals, food,
technology, and more
Financial review and pro forma analysis
- What to calculate, how to calculate it, and how to
intelligently project the future
Traditional and alternative methods: when to use each
- Discounted cash flow, earnings multiples, adjusted
present value, real options and more
Accounting for mergers and acquisitions
- Income statement, balance sheet, and cash flow
statement transformations
Key financial reporting and tax considerations
- Pooling, purchase accounting, goodwill, and other
critical issues
Valuing acquisitions: the concise, practical, easy-to-use
guide for every decision-maker.
- Covers the entire valuation process, start to
finish
- Offers expert guidance for choosing among traditional
and alternative methods
- Covers reporting, accounting, and tax considerations in
depth
- Includes examples and case studies from widely diverse
industries
- Illuminates key points with actual data for the Nokia
Corporation
The M&A environment has never been more unforgiving,
as target companies work harder than ever to maximize their
worth, and acquiring companies fight to avoid
overvaluation—the "winner's curse." In Valuation:
Avoiding the Winner's Curse, two leading practitioners
offer a hands-on, practical guide to valuation as it's
practiced right now. The authors focus on the most crucial
issues you face in valuing companies, offering expert
advice and proven "rules of thumb" you simply won't find
elsewhere.
The authors introduce and illustrate both traditional
and alternative valuation models, drawing on recent
experience to illuminate the key accounting, reporting, and
tax issues you must face in order to value a company
accurately. They walk through several examples and case
studies, including Eli Lilly, Quaker Oats, and Air Products
and Chemicals-and clarify many key points with actual data
for the Nokia Corporation.
Whether you've moved valuation in-house or you're
scrutinizing the work of your outside consultants far more
closely, Valuation: Avoiding the Winner's Curse gives you
crucial skills for minimizing risk-and maximizing
shareholder value.
Contents
- 1. Valuation: An Overview.
- 2. Financial Review and Pro Forma Analysis.
- 3. Traditional Valuation Models.
- 4. Alternative Valuation Models.
- 5. Accounting Dilemmas in Valuation Analysis.
- 6. Financial Reporting and Tax Considerations in
Mergers and Acquisitions.
- 7. Some Final Thoughts.