Valuation of a company, shares or stock
Knowledge of goodwill is an important element of the company’s management, one of the reasons for making strategic decisions about the future of a business.
Three types of valuation methods are used to determine the fair value of a company: the property methods, the comparative methods and the income ones.
Property methods are based on the valuation of individual assets.
Depending on the valuation objective, adequate value standards (accounting, market value, liquidation) are applied.
Comparative methods refer the value of the company under valuation to comparable public companies or comparable past transactions via appropriately selected multipliers.
Company valuation by means of an income method consists in reducing future cash flows generated by an enterprise to their value at the valuation date.