企業(yè)價值評估八大核心方法（Eight core methods of enterprise value evaluation）

1、企業(yè)價值評估八大核心方法（Eight core methods of enterprise value evaluation）The reasonable evaluation of the value of the target enterprise is one of the most important problems encountered in the process of M & A and foreign investment. Appropriate evaluation method is the premise of the accurate evaluation of

2、enterprise value. This paper will focus on the core methods of enterprise value evaluation, respectively, from the basic principles of the method, the scope of application and limitations of the analysis and summary.I. enterprise value evaluation method systemEnterprise value evaluation is a compreh

3、ensive asset and equity assessment. It is the process of analyzing and estimating the whole value of the enterprise, the total equity value of the shareholder or the value of the part of the equity. At present, the international evaluation methods are mainly divided into three categories: income met

4、hod, cost method and market method.The income approach is used to determine the value of the evaluated object by capitalizing or discounting the expected earnings of the evaluated enterprise to a specified date. The theory is based on the principle of economics in the discount theory, namely the val

5、ue of an asset is the use of it can get the present value of future earnings, the discount rate reflects the investment of the asset and profit risk rate of return. The main methods of income method include discounted cash flow (DCF), internal rate of return (IRR), CAPM model and EVA valuation metho

6、d, etc.The cost method is based on the balance sheet of the target enterprise and determines the value of the evaluation object by reasonably evaluating the assets value and liabilities of the enterprise. The theoretical basis is that the price paid by any rational person for an asset will not be hi

7、gher than the price of the replacement or purchase of the same use alternatives. The main method is the replacement cost (cost plus sum) method.The market law is to compare the object of assessment with the equity assets such as the enterprise that can refer to the enterprise or the existing transac

8、tion cases in the market, the shareholders equity and the securities, so as to determine the object value of the evaluation. The premise is that the assumption that a similar asset in a perfect market will have similar prices. The commonly used methods in market law are reference enterprise comparis

9、on method, merger case comparison method and price earnings ratio method.Income approach and cost approach focus on the development of enterprises themselves. The difference is the income method focus on corporate earnings potential, considering the time value of future income, is based on the prese

10、nt and future, so for in the growth stage or mature stage and has a stable and lasting benefits for enterprises using the income method. The cost of law is to consider the current asset liability enterprise, is the enterprise at present the true value assessment, so only involves a investment or onl

11、y owned immovable property holding companies, as well as the assessment of the assessment of the enterprise precondition for non continuous operation, appropriate cost method for evaluation.The market law is different from income method and cost method. It transfers the evaluation key from the enter

12、prise itself to the industry, and completes the transformation of the evaluation method from both inside and outside. The market method is simpler and easier to understand than the other two methods. Its essence is to seek a suitable benchmark for horizontal comparison, when the target enterprise be

13、longs to the development potential, and the future earnings can not be determined, the application advantages of the market law are highlighted.Income approach and cost approach focus on the development of enterprises themselves. The difference is the income method focus on corporate earnings potent

14、ial, considering the time value of future income, is based on the present and future, so for in the growth stage or mature stage and has a stable and lasting benefits for enterprises using the income method. The cost of law is to consider the current asset liability enterprise, is the enterprise at

15、present the true value assessment, so only involves a investment or only owned immovable property holding companies, as well as the assessment of the assessment of the enterprise precondition for non continuous operation, appropriate cost method for evaluation.The market law is different from income

16、 method and cost method. It transfers the evaluation key from the enterprise itself to the industry, and completes the transformation of the evaluation method from both inside and outside. The market method is simpler and easier to understand than the other two methods. Its essence is to seek a suit

17、able benchmark for horizontal comparison, when the target enterprise belongs to the development potential, and the future earnings can not be determined, the application advantages of the market law are highlighted.Two, the core method of enterprise value evaluation1, discounted cash flow (DCF), whi

18、ch focuses on the time value of moneyThe cash flow created by enterprise assets is also called free cash flow. They are created by asset based business activities or investment activities over a period of time. But the future cash flow is time value, and when considering the forward cash inflow and

19、outflow, we need to eliminate the potential time value, so we should use the appropriate discount rate to discount.Therefore, the key to the DCF approach lies in the determination of future cash flow and discount rates. Therefore, the application of the method is based on the sustainability of the e

20、nterprise and the predictability of the future cash flow. The limitations of the DCF method that can generate growth can only estimate the already open investment opportunities and existing business future cash flow value, without considering the various investment opportunities in an uncertain envi

21、ronment, and this investment opportunity will determine and influence the enterprise value to a great extent.2, the internal rate of return (IRR) is assumed to be zeroThe internal rate of return is the discount rate that makes the net present value of the enterprise net zero. It has a part of the DC

22、F law, which is most often used in place of the DCF method. Its basic principle is to try to find a numerical value that generalizes the characteristics of an enterprises investment. The internal rate of return is not affected by the capital market interest rate. It depends entirely on the cash flow

23、 of the enterprise and reflects the inherent characteristics of the enterprise.However, the internal rate of return method can only tell investors that the value of an enterprise to be evaluated is not worth investing, but they do not know how much money it is worth to invest. And the method of inte

24、rnal rate of return in the face of investment enterprises and financing enterprises when the criterion is just the opposite: for investment type enterprises, when the internal rate of return is greater than the discount rate, suitable for investment enterprises; when the internal rate of return is l

25、ess than the discount rate, the enterprise is not worth the investment; financing of enterprises is not.Generally speaking, for the investment or merger of an enterprise, the investor wants to know not only the value of the target enterprise, but also the overall value of the target enterprise. But

26、the internal rate of return method can not satisfy the latter, therefore, this method is more applied to individual project investment.3, the CAPM model of value evaluation of venture assets in complete marketThe capital asset pricing model (CAPM) was originally designed to evaluate risky assets (su

27、ch as stocks). But the value of the stock depends heavily on the risk of earning the proceeds of the stock purchase. Its nature is similar to venture capital, and the two is to discount future earnings at a rate of return on risk. Therefore, the CAPM model can also be used to determine the discount

28、rate of venture capital items while valuing the stock.Under the framework of general economic equilibrium, it is assumed that all investors use the utility function of income and risk as independent variables, and the specific form of CAPM model can be derived:Seemingly complex formula, actually con

29、tains a very simple truth. The expected return on assets depends on risk-free returns, market portfolio returns, and the size of correlation coefficients. The risk-free rate of return is about investing in safe assets such as deposits or buy bonds yields; market portfolio returns on the market is th

30、e average income of all types of securities after weighted rate represents the average income level of the market; the correlation coefficient represents the correlation value between the overall level of investors buy assets with market. Therefore, the nature of the method is to study the correlati

31、on between individual assets and the market as a whole.The derivation and application of the CAPM model have strict premises, and have strict regulations on the market and investors. Under the premise that Chinas securities market needs to be improved, the application of the CAPM model is limited, b

32、ut its core idea is worthy of reference and promotion.4. The EVA evaluation method of capital opportunity costEVA (Economic Value Added) is an important index of business management of the enterprise performance evaluation and management for the more popular abroad in recent years, the core idea of

33、EVA is introduced to assess the value of the field, can be used to evaluate the enterprise value.In the method of enterprise value evaluation based on EVA,The value of an enterprise is equal to the present value of the investment capital, plus the present value of the EVA in the coming years, namely

34、: the value of the enterprise = the value of the investment capital + the expected EVA.According to Sternberg Manchester ? interpretation of EVA, which is the difference between the capital income and the opportunity cost of capital. That is:EVA= net operating profit after tax - total capital cost =

35、 investment capital * (return on investment capital - weighted average capital cost rate).The EVA evaluation method takes into account not only the capital profitability of an enterprise, but also the insight into the opportunity cost of enterprise capital applications. By incorporating opportunity

36、cost into the system, it examines the ability of managers to select projects favorably. However, the grasp of enterprise opportunity cost becomes the key and difficult point of this method.5, in accordance with the 1+1=2 rule of the replacement cost methodThe replacement cost method will be evaluate

37、d as the enterprise combination for various production factors, based on the asset inventory check, one by one to refer to the assets assessment, and confirm the existence of corporate goodwill or economic loss, in which each individual can confirm the assessed value of the assets Collection Plus en

38、terprise goodwill or minus the economic loss, assessment can get the value of the enterprise value. That is: the overall asset value of the enterprise = sigma individual, which means the value of the asset or goodwill (or economic loss).The most basic principle of the replacement cost method is simi

39、lar to the equation 1+1=2, which considers the enterprise value as the simple sum of each individual asset. Therefore, one of the major drawbacks of this approach is the neglect of synergies and scale effects among different assets. That is to say, in the process of enterprise management, it is ofte

40、n 1+1 2, and the overall value of the enterprise is greater than the total value of the individual asset evaluation.6, pay attention to industry benchmarking reference, enterprise comparison method and merger case comparison methodCase comparison and reference of enterprise merger is evaluation of e

41、nterprises in the same or similar industry and the status of the benchmark object by comparing with the analysis, get the financial and operating data, multiplied by the appropriate value ratios or economic indicators, thus obtains the evaluation object value.But in reality, it is difficult to find

42、a business with the same risk assessment with the same structure and benchmarking, therefore, comparison and reference of enterprise M & A case comparison method will generally split different aspects of enterprise value in multiple dimensions, and determine the weight according to the relative stre

43、ngth of each part and the whole value. That is to say, the value of the enterprise to be evaluated = (a x to be evaluated, enterprise dimension, 1/ benchmarking, enterprise dimension, 1+b * evaluation, enterprise dimension, 2/ benchmarking, enterprise dimension, 2+.) * benchmarking enterprise value.

44、7, the market capitalization of listed companies to evaluate the price earnings multiplier methodP / E multiplier method is specially applied to the valuation of listed companies. Estimated share price of an enterprise = average earnings per share of the same type * the earnings per share of an ente

45、rprise to be evaluated.To use value earnings multiplier method to evaluate enterprise value, we need to have a more perfect and developed securities market, and also have a full range of listed companies. Because there is a certain distance from the securities market of our country from complete mar

46、ket, while domestic listed companies in terms of ownership and structure have great differences, at this stage, the auxiliary system earnings multiplier method evaluation as the enterprise value only, is not suitable as an independent method to carry on the overall assessment of the value of enterpr

47、ises. However, the application of this method is more mature in the foreign market.Therefore, the key to the DCF approach lies in the determination of future cash flow and discount rates. Therefore, the application of the method is based on the sustainability of the enterprise and the predictability

48、 of the future cash flow. The limitations of the DCF method that can generate growth can only estimate the already open investment opportunities and existing business future cash flow value, without considering the various investment opportunities in an uncertain environment, and this investment opp

49、ortunity will determine and influence the enterprise value to a great extent.2, the internal rate of return (IRR) is assumed to be zeroThe internal rate of return is the discount rate that makes the net present value of the enterprise net zero. It has a part of the DCF law, which is most often used

50、in place of the DCF method.Its basic principle is to try to find a numerical value that generalizes the characteristics of an enterprises investment. The internal rate of return is not affected by the capital market interest rate. It depends entirely on the cash flow of the enterprise and reflects t

51、he inherent characteristics of the enterprise.However, the internal rate of return method can only tell investors that the value of an enterprise to be evaluated is not worth investing, but they do not know how much money it is worth to invest. And the method of internal rate of return in the face o

52、f investment enterprises and financing enterprises when the criterion is just the opposite: for investment type enterprises, when the internal rate of return is greater than the discount rate, suitable for investment enterprises; when the internal rate of return is less than the discount rate, the e

53、nterprise is not worth the investment; financing of enterprises is not.Generally speaking, for the investment or merger of an enterprise, the investor wants to know not only the value of the target enterprise, but also the overall value of the target enterprise. But the internal rate of return metho

54、d can not satisfy the latter, therefore, this method is more applied to individual project investment.3, the CAPM model of value evaluation of venture assets in complete marketThe capital asset pricing model (CAPM) was originally designed to evaluate risky assets (such as stocks). But the value of t

55、he stock depends heavily on the risk of earning the proceeds of the stock purchase. Its nature is similar to venture capital, and the two is to discount future earnings at a rate of return on risk. Therefore, the CAPM model can also be used to determine the discount rate of venture capital items whi

56、le valuing the stock.Under the framework of general economic equilibrium, it is assumed that all investors use the utility function of income and risk as independent variables, and the specific form of CAPM model can be derived:Seemingly complex formula, actually contains a very simple truth. The ex

57、pected return on assets depends on risk-free returns, market portfolio returns, and the size of correlation coefficients. The risk-free rate of return is about investing in safe assets such as deposits or buy bonds yields; market portfolio returns on the market is the average income of all types of

58、securities after weighted rate represents the average income level of the market; the correlation coefficient represents the correlation value between the overall level of investors buy assets with market. Therefore, the nature of the method is to study the correlation between individual assets and

59、the market as a whole.The derivation and application of the CAPM model have strict premises, and have strict regulations on the market and investors. Under the premise that Chinas securities market needs to be improved, the application of the CAPM model is limited, but its core idea is worthy of reference and promotion.4. The EVA evaluation method of capital opportunity