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Valuation Methods and Shareholder Value Creation

  • 1st Edition - August 30, 2002
  • Latest edition
  • Author: Pablo Fernandez
  • Language: English

Valuation Methods and Shareholder Value Creation provides a comprehensive examination of valuation tools and guidance for analyzing and valuing a business. It covers the basic… Read more

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Description

Valuation Methods and Shareholder Value Creation provides a comprehensive examination of valuation tools and guidance for analyzing and valuing a business.

It covers the basics of valuation methods and shareholder value creation in addition to rigorous approaches to discounted cash flow valuation and real options for valuing a company. It highlights quantitative analyses of firm value; emphasizes qualitative management assessments; and integrates data from international companies.

By examining eight different methods of discounted cash flow valuation and discussing the pros and cons of each method, the book offers thorough, accessible coverage of corporate valuation.

The book provides well-structured guidance for practitioners and MBA students with a background in finance.

Key features

  • Highlights quantitative analyses of firm value
  • Emphasizes qualitative management assessments
  • Integrates data from international companies

Readership

The evaluation of credit worthiness is often overlooked in favor of its more glamorous sister, credit risk management. While the management of risk has enjoyed substantial popularity due to in part to the ability of the Black-Sholes formula to hedge risk and the rise in popularity of derivative securities, the ability to evaluate credit worthiness has received only nodding recognition. Nevertheless an important subject, credit risk analysis is the subject of this "how to" book written by Keith Checkley, formerly of Barclays Bank and now Associate Director of Prebon Training Services, a firm that delivers customized training and seminar services to corporations and banks in Europe, the United States, and the Pacific Rim.

Table of contents

Basic Concepts; Company Valuation Methods; Price-Earnings Ratio, Profitability, Cost of Capital, and Growth; Splitting the Price-Earnings Ratio: Franchise, Growth, Interest, and Risk Factors; Market Value and Book Value; Dividends and Market Value; Interest Rates; Valuation Using Multiples; Cash Flow and Net Income; Inflation and Value; Cost of Equity; Valuations of Internet Companies; Proposed Measures of Value Creation, Economic Profit, MVA, CVA, CFROI, and TSR; EVA, Economic Profit, and Cash Value Added do not Measure Shareholder Value Creation; The RJR Nabisco Valuation; Valuation and Value Creation in Internet-Related Companies; Discounted Cash Flow Valuation Methods; Optimal Capital Structure; Financial Literature about Discounted Cash Flow Valuation; Application of the Different Theories to RJR Nabisco; Eight Methods and Seven Theories for Valuing Companies by Cash Flow Discounting; Real Options; Valuation of Brands and Intangibles; Appendix A: Capital Asset Pricing Model (CAPM).

Review quotes

"This book is an impressive synthesis of sound theory and best practice, accessible to the novice and yet of such depth as to be compelling to the advanced practitioner. It is an important addition to the professional library of both the aspirant to senior executive positions, and to the finance specialist. Acquire it without hesitation."—Robert F. Bruner, Distinguished Professor of Business Administration and Executive Director of the Batten Institute, University of Virginia, Charlottesville

"Pablo Fernandez's Valuation Methods and Shareholder Value Creation is an ambitious and comprehensive managerial treatment of valuation. Valuing projects and firms is critical to the work of executives, investors, bankers and others, and this book provides these decision-makers with a valuable road map through this difficult terrain."—Peter Tufano, Sylvan C. Coleman Professor of Financial Management and Chair, Finance Area, Harvard Business School

Product details

  • Edition: 1
  • Latest edition
  • Published: September 11, 2002
  • Language: English

About the author

PF

Pablo Fernandez

Affiliations and expertise
IESE Business School, University of Navarra, Madrid, Spain

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