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M&A Blog #16 – valuation (Discounted Cash Flow)

Francine Way

As I mentioned in my last post, Discounted Cash Flow (DCF) is a valuation method that uses free cash flow projections, a discount rate, and a growth rate to find the present value estimate of a potential investment. Remember the cardinal rule in accounting: balance sheet must balance.

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05-19-2023 Newsletter: TONIGHT ONLY: $99 Buyside Starter Kit

OfficeHours

If you don’t have an account already, create a free account here and purchase our Buyside Starter Kit with the code BUYSIDESTARTER here. A Few Reads to Digest Valuation Simplified: How Discounted Cash Flow Modeling Drives Financial Analysis Harness Discounted Cash Flow (DCF) modeling for financial analysis.

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Methods and Examples on How to Value a Company

Lake Country Advisors

It is calculated by multiplying the current share price by the total outstanding shares. Example Scenario: Suppose XYZ Corp is a publicly traded technology company with 50 million shares outstanding, and the current share price is $20. Example Scenario: Suppose you want to value a technology company, TechCo.

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Why Accurate Financials are Key to Success in Buying, Selling, and Valuing Businesses

How2Exit

With a background in finance and accounting from his time at Deloitte, Ryan has built his expertise in business valuation. With extensive experience in the field, Ryan shares his remarkable journey from a corporate finance role to becoming the owner of multiple thriving businesses across various industries.

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The Role of Investment Banking Courses in Career Progression

OfficeHours

You can start learning about WHY bankers utilize analyses like discounted cash flow, leveraged buyout, and comparable companies, rather than learning just how to execute them. You are meant to put in the work in order to become the best finance mind that can eventually lead you to a coveted buyside role.

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Unlock the Secrets Behind Business Valuations: What Every Owner Needs to Know Before Selling

How2Exit

Gregory's vast experience is laid bare as he shares the differences in valuation methodologies, adapting from roles in home building business operations to being a leading business valuator. – Gregory Caruso "Fair market value says we can't take synergies into account."

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M&A Blog #14 – valuation (roles, types, equity & enterprise values)

Francine Way

There are also structural differences of past acquisitions to take into account. Do they have the cash of debt/equity capacity to bid aggressively? The status of the acquirer’s own share price will impact its acquisition currency. To minimize taxes on these transfers, low valuation on the transferred shares is common.

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