E-Book Overview
This is a good intro to give the basics of valuation for "old economy" businesses. It determines the valuation of companies based almost exclusively on their cash flow over the previous few years (i.e., 3, 5 and 7 year periods) to the analysis. Unfortunately it ignores (completely) too many issues that play an extremely important role in valuation. For example, the quality, background, knowledge of management, the products the company manufactures, the markets for these products, macroeconomic conditions, intellectual property, market position (i.e., oligopolistic? Is entry/exit difficult in the industry?). Not one of these issues is even touched upon!!! The authors seem to be implying that these issues are irrelevant!! Only the cash flow over the previous few years applied forward (i.e., discounted for present value) matters according to the book!!! Perhaps this type of mentality explains why the overwhelming majority of mergers and acquistions fail!!!! If you are looking purely for a way to use past cash flows to determine a company's "value" this is the book for you. If you are looking for a discussion of just about any other factor affecting valuation, forget it.
E-Book Content
Page i Valuation Measuring and Managing the Value of Companies Page ii WILEY FINANCE Advanced Fixed-Income Valuation Tools, Narasimham Jegadeesh and Bruce Tuckman Beyond Value at Risk, Kevin Dowd Buying and Selling Volatility, Kevin B. Connolly Chaos and Order in the Capital Markets: New View of Cycles, Prices, and Market Volatility, Second Edition, Edgar E. Peters Corporate Financial Distress and Bankruptcy, Second Edition, Edward I. Altman Credit Derivatives: A Guide to Instruments and Applications, Janet Tavakoli Credit Risk Measurement: New Approaches to Value at Risk and Other Paradigms, Anthony Saunders Currency Derivatives: Pricing Theory, Exotic Option