Company Valuation, a graphical approach

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IE code:
DF2-221-I-M
Language: English
also available in Spanish
Format:
Multimedia
Est. dedication time:
45 minutes
Academic Area:
Type of publication:
Technical Note

Instructor support

A Teaching Note is available for this material.

Company Valuation, a graphical approach

Description

This interactive tutorial describes in a very simple manner the four valuation methods: accounting method liquidation method discounting of cash flows and ratios. Using animations and graphs it shows what each of these methods measures focusing on the balance sheet.

The last section of this tutorial is an exercise where students have to apply the four valuation methods for a fictitious company. The objective is for them to see a graphical comparison of the different values obtained under each one of the methods.

This tutorial has been used successfully in undergraduate, graduate (in particular MBA, Masters in Finance and Masters in Management courses) and executive education level finance courses, both in online/blended and face-to-face formats.

Author's comments

Students new to business valuation and those needing to refresh concepts will find this multimedia tool useful as it uses an intuitive easy to understand visual methodology.

Different valuation methods are presented using animations thus providing a graphic approach. This enables students to connect the dots as to value elements. A numerical exercise is included whereby a business Las Renas Ltd. is to be valued using the different methods previously presented.