did-you-know? rent-now

Rent More, Save More! Use code: ECRENTAL

did-you-know? rent-now

Rent More, Save More! Use code: ECRENTAL

5% off 1 book, 7% off 2 books, 10% off 3+ books

9780130348043

Valuation : Avoiding the Winner's Curse

by ;
  • ISBN13:

    9780130348043

  • ISBN10:

    013034804X

  • Format: Hardcover
  • Copyright: 2002-01-01
  • Publisher: FT Press
  • View Upgraded Edition
  • Purchase Benefits
  • Free Shipping Icon Free Shipping On Orders Over $35!
    Your order must be $35 or more to qualify for free economy shipping. Bulk sales, PO's, Marketplace items, eBooks and apparel do not qualify for this offer.
  • eCampus.com Logo Get Rewarded for Ordering Your Textbooks! Enroll Now
List Price: $36.99

Summary

InValuation: Avoiding the Winner's Curse, authors Kenneth R. Ferris and Barbara S. Pecherot Petitt will help you master both the science and the art of M&A valuation. Concise, realistic, and easy to use, it brings together the field's best "rules of thumb," compares every leading traditional and alternative approach, presents examples and case studies from many industries, and offers practical solutions for today's key accounting, reporting, and tax-related challenges.

Table of Contents

Preface xi
Valuation: An Overview
1(14)
Why Firms Merge or Acquire: A Historical Perspective
3(2)
Merger and Acquisition Premiums
5(1)
The Process of Valuation
6(2)
Alternative Valuation Frameworks
8(5)
Summary
13(1)
Notes
13(2)
Financial Review and Pro Forma Analysis
15(54)
Financial Review
16(20)
Pro Forma Analysis
36(9)
Sensitivity Analysis: Alternative Scenarios
45(2)
Summary
47(1)
Notes
48(21)
Appendix 2A Nokia Corporation Financial Data
51(2)
Appendix 2B Preparation of Statement of Cash Flows
53(12)
Appendix 2C Displayed Formulas for EXCEL™ Spreadsheet
65(2)
Appendix 2D Account Forecasting Alternatives
67(2)
Traditional Valuation Models
69(38)
Earnings Multiples Analysis
70(4)
Discounted Cash Flow Analysis
74(20)
Summary
94(1)
Notes
95(12)
Appendix 3A Calculating the WACC for a Complex Capital Structure
98(3)
Appendix 3B Some Frequently Asked Questions and Answers About DCFA and Earnings Multiples Valuation
101(6)
Alternative Valuation Models
107(32)
Valuation in the Absence of Earnings or Cash Flow
108(4)
Valuation When Capital Structure Changes
112(11)
Economic Value Analysis
123(3)
Real Options Analysis
126(2)
Summary
128(1)
Notes
128(11)
Appendix 4A Discounted Cash Flow Analysis: Go America, Inc.
130(2)
Appendix 4B Capital Cash Flow Analysis
132(2)
Appendix 4C DCFA When a Firm's Capital Structure Changes
134(2)
Appendix 4D The Black-Scholes Model
136(3)
Accounting Dilemmas in Valuation Analysis
139(40)
Assessing Economic Reality
140(2)
Income Statement Transformations: Forecasting Permanent Earnings and Free Cash Flows
142(15)
Balance Sheet Transformations: Forecasting the Equity Value of a Company
157(11)
Cash Flow Statement Transformations: Forecasting CFFO and Free Cash Flow
168(2)
Summary
170(5)
Notes
175(4)
Financial Reporting and Tax Considerations in Mergers and Acquisitions
179(28)
Financial Reporting: To Combine, or Not to Combine?
181(2)
Consolidated Reporting: Pooling versus Purchase Accounting
183(7)
Pooling versus Purchase Accounting: The Effect on Firm Valuation
190(1)
Tax Considerations of Mergers and Acqusitions
191(2)
Minority Interest
193(1)
Accounting for Goodwill
194(3)
Summary
197(4)
Notes
201(6)
Appendix 6A Negative Goodwill
205(2)
Some Final Thoughts
207(6)
Valuation: A Debriefing
208(2)
Some Caveats to Consider
210(1)
Closure
211(2)
Bibliography 213(5)
Index 218

Supplemental Materials

What is included with this book?

The New copy of this book will include any supplemental materials advertised. Please check the title of the book to determine if it should include any access cards, study guides, lab manuals, CDs, etc.

The Used, Rental and eBook copies of this book are not guaranteed to include any supplemental materials. Typically, only the book itself is included. This is true even if the title states it includes any access cards, study guides, lab manuals, CDs, etc.

Excerpts

Preface Valuation is the essence of finance. It asks the question, "What is the 'fair' price to pay for an asset that has a set of uncertain future cash flows?" In the past, the answer to this question was provided by time-tested methods. In recent years, however, new approaches have emerged as practitioners have sought improved ways to assess value. New approaches have also evolved in response to the development of the "new economy" and the many e-commerce companies that were privatized without a history of either earnings or cash flows. With the backdrop of a rapidly changing valuation environment, this book presents a practitioner-oriented view of the fundamentals of firm valuation. The focus is on valuation for acquisition purposes. In large measure, an acquisition is viewed herein as equivalent to the purchase of any productive asset, namely, as a capital budgeting exercise. Furthermore, valuation is considered to be an art, not a science. Consequently, the reader will find that there are many "rules of thumb" but few inviolable principles to guide them. The metrics used for valuing companies are not well defined, varying often according to the objectives of the valuation and often with the companies themselves. Consequently, executives and equity analysts face many choices and dilemmas as they try to assess value. Throughout this book, practical solutions are suggested for dealing with these dilemmas and for helping the reader make informed choices. The methods discussed are principally for use in nonfinancial companies; the topic of valuing financial companies is beyond the scope of this book. To use this book effectively, the reader will need an understanding of the fundamentals of accounting and finance. Furthermore, a background in spreadsheet software, such as EXCEL, is also beneficial.

Rewards Program