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Definition of 'Valuation Analysis'

The document discusses corporate valuation methods and valuation analysis. It provides definitions and explanations of valuation analysis from Investopedia, including that it compares valuations of securities to evaluate investment merits or objectively assess a business's value. Common valuation metrics for equities include price-to-earnings ratios and other ratios. The document also discusses net present value, internal rate of return, and payback period as common approaches to project selection in capital budgeting. It notes these methods sometimes provide contradictory results, so management must decide which to emphasize.

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48 views3 pages

Definition of 'Valuation Analysis'

The document discusses corporate valuation methods and valuation analysis. It provides definitions and explanations of valuation analysis from Investopedia, including that it compares valuations of securities to evaluate investment merits or objectively assess a business's value. Common valuation metrics for equities include price-to-earnings ratios and other ratios. The document also discusses net present value, internal rate of return, and payback period as common approaches to project selection in capital budgeting. It notes these methods sometimes provide contradictory results, so management must decide which to emphasize.

Uploaded by

ajaykudav
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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what all things did mam say ???

type here What is valuation objectives of valuation Diff models involved in valuation Scope Thts it

ok but she talked about what info u can gather, what resources are available for you to take this topic and all these things inorder to decide a particular topic for project RIGHT?

thsi pdf that we are looking now is sort of a case study that she talked about

But then is this case studt applicable 4 our project ?

no i am just saying we need to decide our approach re will it be case study based like Tata-Corus she said or another way? 1st let us decide the roadmap OK

Definition of 'Valuation Analysis'


A form of fundamental analysis that looks to compare the valuation of one security to another, to a group of securities or within its own historical context. Valuation analysis is done to evaluate the potential merits of an investment or to objectively assess the value of a business or asset. Valuation analysis is one of the core duties of a fundamental investor, as valuations (along with

cash flows) are typically the most important drivers of asset prices over the long term.

Investopedia explains 'Valuation Analysis'


Valuation analysis should answer the simple, yet vital, question of, "What is something worth?" The analysis is then based on either current projections or projections of the future. While investors can agree on a metric like the current price-to-earnings ratio (P/E ratio), how to interpret a given valuation can and will differ among those same investors. Many types of valuation methods are used, involving several sets of metrics. For equities, the most common valuation metric to use is the P/E ratio, although other valuation metrics include: Price/Earnings, Price/Book Value, Price/Sales, Enterprise Value/EBIDTA, Economic Value Added and Discounted Cash Flow. Read more: http://www.investopedia.com/terms/v/valuation_analysis.asp#ixzz1uxoA3200

An Introduction To Corporate Valuation Methods


July 08 2011 | Filed Under Accounting, Business

Capital budgeting involves choosing projects that add value to the firm. This can involve almost anything from acquiring a lot of land to purchasing a new truck or replacing old machinery. Businesses, specifically corporations, are typically required, or at least recommended, to undertake those projects which will increase profitability and thus enhance shareholders' wealth. Tutorial: Financial Concepts When a firm is presented with a capital budgeting decision, one of its first tasks is to determine whether or not the project will prove to be profitable. The net present value (NPV), internal rate of return (IRR) and payback period (PB) methods are the most common approaches to project selection. Although an ideal capital budgeting solution is such that all three metrics will indicate the same decision, these approaches will often produce contradictory results. Depending on managements' preferences and selection criteria, more emphasis will be put on one approach over another. Nonetheless, there are common advantages and disadvantage associated with these widely used valuation methods.

Read more: http://www.investopedia.com/articles/financial-theory/11/corporate-project-valuationmethods.asp#ixzz1uxpEkAoV

http://www.scribd.com/doc/11292285/CORPORATE-VALUATION#download

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