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2017•RePEc: Research Papers in EconomicsRequires access

Are Company Valuation Models the Same? – A Comparative Analysis between the Discounted Cash Flows (DCF), the Adjusted Net Asset, Value and Price Multiples, the Market Value Added (MVA) and the Residual Income (RI) Models

Ion Stancu, Laura Obrejabraşoveanu, Anamaria Ciobanu, Andrei Tudor Stancu

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Abstract

In this article, we analyze and compare several well-known methods of company valuation. In particular, we focus on the income approach (discounted cash flows, the market value added or residual income), the assets approach (net asset), and the market approach (based on value and price multiples) to value companies. This initiative aims to identify the hypothesis considered and to test the equivalence of the results obtained by these valuation methods.

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What this paper is about

In this article, we analyze and compare several well-known methods of company valuation. In particular, we focus on the income approach (discounted cash flows, the market value added or residual income), the assets approach (net asset), and the market approach (based on value and price multiples) to value companies. This initiative aims to identify the hypothesis considered and to test the equivalence of the results obtained by these valuation methods.

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OpenAlex reports 11 citations for this work. Citation counts describe recorded attention and do not establish research quality.

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Available abstract

In this article, we analyze and compare several well-known methods of company valuation. In particular, we focus on the income approach (discounted cash flows, the market value added or residual income), the assets approach (net asset), and the market approach (based on value and price multiples) to value companies. This initiative aims to identify the hypothesis considered and to test the equivalence of the results obtained by these valuation methods.

Key concepts: Discounted cash flow, Residual income valuation, Net asset value, Valuation (finance), Net present value, Net income, Economics, Market value

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Are Company Valuation Models the Same? – A Comparative Analysis between the Discounted Cash Flows (DCF), the Adjusted Net Asset, Value and Price Multiples, the Market Value Added (MVA) and the Residual Income (RI) Models — Research Paper | ScholarLens