How to assess company value

 The selection of methods for assessing the value of a company depends directly on the purpose for which it (the assessment) is carried out. The global trend in assessing the value of companies is becoming increasingly popular in various sectors of the economy. Much attention should be paid to the competent selection of tools when evaluating companies. The selection of methods is also very important. It should be noted that the basis for valuation methods is the concept of economic value added (EVA in literal translation from English), the essence of which is the growth of the market value of the company's shares by any economic methods. If the evaluation of the company becomes manageable, then, undoubtedly, the activities of this organization will be successful, provided that the management is properly organized. One of the company's valuation methods is the discounted cash flow method (DCF). The comparative method is also used - this is a comparison of several companies of a similar scale and similar specialization. It is important, however, that the shares of the aforementioned companies have a specific market value. An important and effective method of valuation of the company is considered - the methods of net assets. But most often the most popular of them is called the first - DDT.

The method of retrospective analysis in assessing the value of the company. Upon closer examination of the discounted cash flow method, it turns out that it is impossible without a free flow of assets (freely distributable among the firm's investors) and a discount rate. The ways of free distribution of the flow of funds can be the payment of dividends or repeated investments in the business. It is necessary to evaluate the value of a company using a comparative method. It includes analysis of not only domestic but also foreign companies. Of the known methods for assessing the value of a company in the modern economic market, the basic methods were not named - profitable and costly.

The basic conditions for retrospective analysis and forecasting are:

range of products;

the pace of development of the organization;

production level;

pricing policy of manufactured products;

market demand;

technological base of production;

investment prospects;

planning the results of financial injections;

economic background in the state;

local production conditions;

competition;

the niche of this enterprise in the market;

measurement of a unit of growth per unit of time;

long-term management plan.

Any comprehensive financial assessment needs to take into account the discount rate (the percentage rate that is used to prospectively recalculate income in the future.