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M&A Terms Every Business Owner Should Know

Class VI Partner

Common Equity Common Equity (sometimes also referred to as Common Stock) reflects the value of a company’s assets minus its liabilities minus any Preferred Equity that would have preference over the Common Equity. It is typically the highest risk/highest potential return portion of a company’s capital structure.

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The Role of Financial Projections in Business Valuation

Equilest

They provide insights into the financial position, capital structure, and overall worth of the business. Balance sheet projections aid in assessing the company's ability to meet its obligations and measure its net worth. Asset-Based Valuation Asset-based valuation methods assess the value of a business based on its net assets.

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Discounted-Cash-Flow-Analysis: Your Complete Guide with Examples

Valutico

This value is widely referred to as the “Net Present Value” (NPV). . which produces a Net Present Value of the Terminal Value of: $74 million. . So the Terminal Value here is three times as large! Discount the Terminal Value. . Enterprise Value. Does this make sense?