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Discounted cash flow is a valuation technique that is
applied in estimating investment opportunity attractiveness. As a tool it helps
in calculating the fair pay for today investment for instance if an investor
invest a certain amount of money how much will he get in future.
Multiple valuations is when a company is valued on market
basis examples of multiple valuation techniques are price/earnings multiple
which makes comparison between a company market capitalization and its annual
income. Other multiple valuation is EBITDA multiple and earning multiple. The advantage
of multiple valuation method is that it require one to look at the multiple
used by other companies in the same industry.
Market Valuation is a technique established in an economic
rationale of competition. According to this valuation technique in a free
market the value of business properties are affected to a particular balance by
forces of demand and supply. Advantage, the technique determines the asset
appraisal value on basis of the price of a similar item.
Comparable transaction method used when valuing a company during
acquisition or merging by looking into the transaction that has occurred in the
industry which are similar to the ones under consideration. Advantage of the
technique is that it help in knowing how much to value a company.
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Oct 12th, 2015
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