Corporate Valuation and Value-Based Management必看课件资料.ppt

CHAPTER 12Corporate Valuation and Value-Based Management Corporate Valuation Value-Based Management Corporate Governance Corporate Valuation: List the two types of assets that a company owns. Assets-in-place Financial, or nonoperating, assets Assets-in-Place Assets-in-place are tangible, such as buildings, machines, inventory. Usually they are expected to grow. They generate free cash flows. The PV of their expected future free cash flows, discounted at the WACC, is the value of operations. Value of Operations Nonoperating Assets Marketable securities Ownership of non-controlling interest in another company Value of nonoperating assets usually is very close to figure that is reported on balance sheets. Total Corporate Value Total corporate value is sum of: Value of operations Value of nonoperating assets Claims on Corporate Value Debtholders have first claim. Preferred stockholders have the next claim. Any remaining value belongs to stockholders. Applying the Corporate Valuation Model Forecast the financial statements, as shown in Chapter 11. Calculate the projected free cash flows. Model can be applied to a company that does not pay dividends, a privately held company, or a division of a company, since FCF can be calculated for each of these situations. Data for Valuation FCF0 = $20 million WACC = 10% g = 5% Marketable securities = $100 million Debt = $200 million Preferred stock = $50 million Book value of equity = $210 million Value of Operations: Constant Growth Suppose FCF grows at constant rate g. Constant Growth Formula Notice that the term in parentheses is less than one and gets smaller as t gets larger. As t gets very large, term approaches zero. Constant Growth Formula (Cont.) The summation can be replaced by a single formula: Find Value of Operations Value of Equity Sources of Corporate Value Value of operations = $420 Value of non-operating assets = $100 Claims on Corporate Value Value of Debt = $200 Value of Preferred Stock = $50 Value of Equit