Where you go to buy or sell a business…..

Far too often business buyers and brokers rationalize the purchase price of a cash negative business by the value of the fixed assets available for sale.  The argument goes that if the value of the tangible assets is X, the business must be worth at least X because, even on the rainiest day, one could [...]

[Read more →]

Now that we are comfortable deriving acquisition multiples using the Guideline Company Method and the Similar Transactions Method, we must learn how to select the proper multiple before applying it to our subject Company and reaching a value conclusion. It can be reasonably assumed that a prudent investor would pay more for the controlling interest [...]

[Read more →]

Now that we understand the difference between Net Income, EBIT, EBITDA and SDCF, let’s take a look at how these metrics can be used to determine the value of a company. You may already have some familiarity with ways in which residential real estate is valued.  For example, your neighbor’s house might be 2,000 sq. [...]

[Read more →]