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Valuation

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Valuation
The textbook definition of valuation is determining the fair value of a company.
    
Valuation is the process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.  For example, an Analyst valuing a company may look at the company's management, the composition of its capital structure, prospect of Future Earnings, and Market value of assets.
    
Judging the contributions of a company's management would be more of a subjective valuation technique, while calculating Intrinsic value based on Future Earnings would be an objective technique
    
Valuation is  he art of making a selected valuation look fair.  The MD Will come to the Analyst and tell him to make the value equal £10 billion. The Analyst Will make this happen (no matter what). The MD Will review the work . If the desired number has been generated, analysis Will go to client. If no, analysts Will be called in, re briefed and told to go back, do the work again, check for mistakes (which the MD knows are there) and come back when the value is £10 billion.
Posted by  ebs Finanzakademie GmbH
 
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