article thumbnail

Update on Oil & Gas Royalties Litigation-Key Valuation Issues

Value Scope

However, as a former treasury professional with two Fortune 100 energy companies, I can articulate that cash does not lie. Treasury Regulations Section 1.611 – “the fair market value of an oil and gas property is the amount which would induce a willing seller to sell and a willing buyer to purchase.” Technology. Regulation.

article thumbnail

Update on Oil & Gas Royalties Litigation-Key Valuation Issues

Value Scope

However, as a former treasury professional with two Fortune 100 energy companies, I can articulate that cash does not lie. The Market Approach The market approach uses comps, both trading and transaction. It is a price-taker business. They paid $300; we cannot use that factoid in any meaningful way today for valuation purposes!

article thumbnail

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

Valutico

the multiple based or ‘ comps ’ (comparable company analysis) approach. Risk free rate (can use 10y Treasury). The first is 1. the intrinsic or income-based approach, also known as an entity approach, then there is also 2. the asset-based approach also known as the cost-based approach, and finally 3. Cost of Debt. Market Return.