Introduction to valuation (Myths (Valuation is objective (There's…
Introduction to valuation
Valuation is objective
There's always bias when making decisions. However, all the data used is quantitative.
A well-researched and well-done valuation is timeless
As every other research, results should be used with the consideration of time. Many factors can alter the results.
Provides precise estimate of value
Theres always uncertainty about the final numbers, we should always keep in mind there's error.
The more quantitative a model, the better the valuation
Making a model more complex does not necessarily mean better results
To make money on valuation, you have to assume that markets are inefficient
It it not clear how markets would become inefficient , or efficient.
The process of valuation is not important
The result is important, but so is the process. Procedures must be done correctly in order to obtain stronger results.
The role of valuation
Valuation and portfolio management
Valuation in acquisition analysis
The effects of synergy on the combined value of the two firms
The effects on value, of changing management and restructuring the target firm, should be taken into consideration
Valuation in corporate finance
Maximization of firm's value
relationship among financial decisions