Most common errors in company valuation
AbstractThis paper contains a collection and a classification of the 12 most common errors seen in company valuations performed by financial analysts, investment banks and financial consultants. The author had access to most of the valuations referred to in this paper when consulting in company acquisitions, sales and mergers, and in arbitrage processes. Some of the errors are from public reports by financial analysts.
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Bibliographic InfoPaper provided by IESE Business School in its series IESE Research Papers with number D/565.
Length: 22 pages
Date of creation: 03 Jul 2004
Date of revision:
valuation; company valuation; valuation errors;
Find related papers by JEL classification:
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
- G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
- M21 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - Business Economics
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- R. Mehra & E. Prescott, 2010.
"The equity premium: a puzzle,"
Levine's Working Paper Archive
1401, David K. Levine.
- Donald R. Lessard, 1996. "Incorporating Country Risk In The Valuation Of Offshore Projects," Journal of Applied Corporate Finance, Morgan Stanley, Morgan Stanley, vol. 9(3), pages 52-63.
- Rajnish Mehra, 2003. "The Equity Premium: Why is it a Puzzle?," NBER Working Papers 9512, National Bureau of Economic Research, Inc.
- Fernandez, Pablo, 2003. "How to value a seasonal company by discounting cash flows," IESE Research Papers, IESE Business School D/511, IESE Business School.
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