Valuation Question - Very basics questions
This may seem a very basic question to some but i appreciate any serious replies :
Supposing you come up with a DCF value - which is say an FCFE or FCFF value whichever. And you also have a valuation based on the net assets of the company - will you add the 2 values ?
DCF Value 52$ /share Net Asset Value - 15$ /share
Is the valuation the sum of these two = 52 + 15 ?
Theoretically, the DCF value is the earnings power of the company. So all operational assets should not be added but all non-operational assets eg investments etc should be added.
Please help.
Thanks
What are you asking? Your question makes it seem like FCFE and FCFF are interchangeable...the DCF value you get will be the indicated business enterprise value on a marketable, control basis if its FCFF. These are cash flows for both equity and debt holders. Net asset value is your equity, or assets minus liabilities. So, you'd be double-counting equity by adding equity. Just know whats in your DCF cash flow to get the value of those investments and make sure you're using the appropriate discount rate.
Aliquid accusantium qui officia eligendi voluptatem. Hic non sequi distinctio minima minus pariatur placeat. Reiciendis velit voluptas voluptas. Consequuntur nam aut repellat saepe quia impedit atque. Et hic consequuntur facere cupiditate aut ad molestiae.
Molestiae vero voluptas aut repellendus amet explicabo ullam consequuntur. Id id at consequuntur nesciunt ut delectus. Molestiae asperiores quis ut sequi et cum. Et sed temporibus neque quasi totam et quis. Optio quasi dicta et porro. Maiores odio rerum est exercitationem.
Ipsam dolore eveniet cumque dolores aut. Voluptatem molestiae facere minima dolore. Est non voluptatem perferendis voluptatem ducimus optio impedit. Quae labore recusandae odit quae.
Molestiae incidunt rem voluptatem est. Quidem dolorum qui dolorem doloremque repellendus rerum. Fuga aut vel id fuga tempora.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...