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29 Valuation Interview Questions and Answers: Mastering the Art of Crackling Interviews

Equilest

Understanding the Concept: In essence, FCFF encapsulates the cash that can be distributed to both debt and equity holders after meeting operational needs and capital expenditures. The resulting value represents the cash available to all contributors of capital—both debt and equity. What is Free Cash Flow to Equity?

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Issues faced when valuing a declining company

Andrew Stolz

Discount Future Cash Flows – either by using the Mid-Year discount or a simple discount period, it is fairly simple to calculate the present value of future cash flows. This action will cause fluctuations in the overall value of equity and debt ratio. These concerns add intricacies to the terminal value computation.

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Deja Vu #11: Can Restricted Stock Studies Be Used to Estimate DLOMs for Dividend-Paying Companies?

Chris Mercer

The median market value of equity (MVE) for dividend-paying stocks was $133 million, and the average MVE was $248 million. The differing natures of the two groups of transactions can be seen when looking at the price/book value multiples. And what about the terminal value that gives rise to capital appreciation?

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Fair Market Value and the Nonexistent Marketability Discount for Controlling Interests

Chris Mercer

The book value of the stock and the financial condition of the business. Whether or not the enterprise has good will or other intangible value. After all, that is the date on which the assumed hypothetical transaction of fair market value occurs. The earning capacity of the company. The dividend-paying capacity.

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How can I learn to valuate a company?

Equilest

Key Financial Ratios: Ratios such as Price-Earnings Ratio (P/E), Price-to-Book Ratio (P/B), and Debt-to-Equity Ratio provide valuable insights into the company's performance and market position. Liquidation Value: This method assesses the value of the company's assets if they were to be sold off in a liquidation scenario.