Valuation: Measuring and Managing the Value of Companies, University Edition, 5th Edition

by McKinsey & Company Inc.; Tim Koller; Marc Goedhart; David Wessels

• ISBN13: 9780470889954
• ISBN10: 0470889950
• Format: eBook
• Copyright: 2010-07-01
• Publisher: Wiley

Summary

McKinsey's Trusted Guide to Teaching Corporate Valuation is Back and Better than EverDesigned for classroom use, Valuation, University Edition Fifth Edition is filled with the expert guidance from McKinsey & Company that students and professors have come to trust. Fully Revised and Updated, NEW FEATURES to the Fifth Edition include: ALL NEW CASE STUDIES that illustrate how valuation techniques and principles are applied in real-world situations NEW CONTENT on the strategic advantages of value-based management EXPANDED to include advanced valuation techniques UPDATED to reflect the events of the real estate bubble and its effect on stock markets, new developments in corporate finance, changes in accounting rules, and an enhanced global perspectiveValuation, Fifth Edition remains true to its roots with a solid framework for valuation through key concepts such as: Analyzing historical performance, including reorganizing a company's financial statements to reflect economic rather than accounting performance Forecasting performance, with emphasis on not just the mechanics of forecasting but also how to think about a company's future economics Estimating the cost of capital with practical tips that aren't found in textbooks Interpreting the results of a valuation in light of a company's competitive situation Linking a company's valuation multiples to the core drivers of its performance.The University Edition contains the same key chapters as Valuation Fifth Edition but expands on them to enhance classroom application with End of Chapter Summaries and Review Questions to help students master key concepts from each chapter before moving on to the next.For professors, Wiley offers an Online Instructor's Manual with a full suite of resources exclusive to adopting professors. Contact your rep for more information.

Table of Contents

About the Authors

Preface

Acknowledgments

Foundations of Value

WhyValueValue?

Fundamental Principles of Value Creation

The Expectations Treadmill

Return on Invested Capital

Growth

Core Valuation Techniques

Frameworks for Valuation

Reorganizing the Financial Statements

Analyzing Performance and Competitive Position

Forecasting Performance

Estimating Continuing Value

Estimating the Cost of Capital

Moving from Enterprise Value to Value per Share

Calculating and Interpreting Results

Using Multiples to Triangulate Results

Intrinsic Value and the Stock Market

Market Value Tracks Return on Invested Capital and Growth

Markets Value Substance, Not Form

Emotions and Mispricing in the Market

Investors and Managers in Efficient Markets

Managing for Value

Corporate Portfolio Strategy

Performance Management

Mergers and Acquisitions

Creating Value through Divestitures

Capital Structure

Investor Communications

Advanced Valuation Issues

Taxes

Nonoperating Expenses, One-Time Charges, Reserves, and Provisions

Leases, Pensions, and Other Obligations

Capitalized Expenses

Inflation

Foreign Currency

Case Study: Heineken

Special Situations

Valuing Flexibility

Valuation in Emerging Markets

Valuing High-Growth Companies

Valuing Cyclical Companies

Valuing Banks

Economic Profit and the Key Value Driver Formula

Discounted Economic Profit Equals Discounted Free Cash Flow

Derivation of Free Cash Flow,Weighted Average Cost of Capital, and Adjusted Present Value

Levering and Unlevering the Cost of Equity

Leverage and the Price-to-Earnings Multiple

Index

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