Talk:Valuation (finance)

Notes

The dicussion of a mining project is not a financial valuation. It should be in another article.

What is the best way to value intangible assets?

Simiply there is no best way to value an intangible assets because valuation is extremely subjective.

One simple way to value an intangible assets, such as patents and trademarks, may be valued based on expected Royality payments, which are subjective. If the royality stream is current and constant, the intanglible may be valued as a mulitple of its revenue stream. —The preceding unsigned comment was added by 71.196.5.25 (talk • contribs) 20:41, 9 October 2006.

Valuing an IT company

IT company generally have intangible assets as in the form of softcodes,if the company goes for liquidiation,the market value of these codes is nowhere as compare to the inputs of preparing it(huge technical staff costs,machines and technology involved) This is the primary reason that IT companies are debt free or they are not levered to huge extents.This means Tax-Sheilds are very less in case of IT firms.They are generally equity financed or internally financed.Valuation of an IT company is completely based on expected cash flows. —Preceding unsigned comment added by Jain puneet (talk • contribs) 13:23, 16 May 2008 (UTC)

71.63.79.102 (talk) 02:19, 3 January 2010 (UTC)Article is simply wrong in several places. This writer has had over 40 years in the appraisal and valuation business and has written three books on valuation. Have neither the time nor the interest in rewriting the article. But, as a single example, there are three, and only three, ways to value any asset. While they have slightly different names one classification would be:

1. Cost Approach - what comparable assets would cost to acquire, adjusting the subject asset for depreciation from all causes (not accounting depreciation) but functional, physical and economic depreciation

2. Market Comparable Approach which looks at what comparable assets are actually selling for in the market place, it being necessary to adjust the subject asset, or the comparable assets, for unique aspects.

3. Income or Discounted Cash Flow ("DCF") Approach which looks at the projected income or cash flow stream and then discounts it back to today's Present Value using a discount rate that properly adjusts for the specific risk characteristics of the subject asset.

Wherever possible a valuation specialist will try to use two, or in some cases all three, ot these Approaches. Everything mentioned in the article is simply an application of one of these three Approaches

alfredking@erols.com71.63.79.102 (talk) 02:19, 3 January 2010 (UTC)

Valuing Business in Mergers & Acquisitions

Valuing Businesses in M&A is very critical.It is Unwinding the worth of busines not just its assets.However,its not neccessary that value drivers will appear on Balance Sheet like innovative and creative staff would not be mentioned in the firm's accounting statements. It is availability of Data which decides what Method to use to value a firm.But,generally more than one method is used to endorse the common understanding.Difference in value would be due to information asymmetry,Transaction Costs etc.Jain puneet (talk) 16:00, 27 May 2008 (UTC)

Lead problems

This article starts off with some challenges. I'm fine with saying that valuation is the process of determining a value (although that's not much of a statement). However, the present sentences flawed in three ways. First it only talks about assets. As noted in the second sentence one can also value a liability. One can also value net worth which is roughly speaking the difference between assets and liabilities — this can get a little complicated but in some circumstances it is not as simple as a straight subtraction. However that last points probably beyond the scope of this introductory discussion. Second, while the present value is and important special case, so important it probably dominates valuation theory, it is not the only date at which assets can be valued. The concept of valuation is broader than simply present values. I won't mind if we start with a broad definition and then immediately restrict this article to the special case of present value but let's not pretend that all valuation is present value. Third, there's an odd restriction that it's not valuation unless it's done by someone authorized to do so. While it might be very common that the person doing the valuation is authorized to do so there's nothing intrinsic in the concept of valuation that requires any authorization. Most people who buy a security do some (admittedly crude) valuations and an almost no cases have they received any specific authorization to do the valuation.

The third sentence talks about doing valuations on assets… or intangible assets. This is sloppy English. Perhaps it should be tangible assets or intangible assets.--S Philbrick(Talk) 00:47, 13 July 2016 (UTC)

Move option section here

Hi all. Following recent article changes to Business valuation - the scale is now re "business broker" deals - I propose moving Business valuation #Option pricing approaches to this article. Comments welcome. Fintor (talk) 07:11, 14 July 2021 (UTC)