Term
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Definition
| book value after asset of liability amounts are added to, deleted from, or changed from the book amounts |
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Term
| Adjusted book value method |
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Definition
| all assets and liabilities are adjusted to the fair market values |
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Term
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Definition
| multivariate model for estimating the cost of equity capital that incorporates several systematic risk factors |
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Term
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Definition
| determine value for a business by using value of assets net liabilities |
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Term
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Definition
| measure of systemic risk; correlated with changes in a specific index |
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Term
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Definition
| % deducted from price of public stock due to the size such that couldnt be sold in reasonable time |
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Term
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Definition
| commercial industrial, or investment entity pursuing an economic activity |
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Term
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Definition
| degree of uncertainty of realizing the expected future returns of the business resulting from factors other than financial leverage |
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Term
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Definition
| Capital Asset Pricing Model: model with cost of capital for any stock or portfolio of stocks equals risk free rate +risk premium(Beta) |
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Term
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Definition
| conversion of a single period economic benefits into value |
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Term
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Definition
| any multiple of divisor used to convert the anticipated economic benefits of a single period into value |
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Term
| Capitalization of earnings method |
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Definition
| method within income approach whereby economic benefits for a representative single period are converted to value through division by cap rate |
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Term
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Definition
| any divisor used to convert the anticipated economic benefits of a single period into value |
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Term
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Definition
| composition of the invested capital of a business enterprise; mix of debt and equity |
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Term
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Definition
| cash generated by asset or business over period of time |
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Term
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Definition
| financial statements in which each line is expressed as a percentage of the total; on balance sheet each line item is shown as a % of total asssets, and on the income statement, each item is expressed as a % of sales |
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Term
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Definition
| power to direct the mngmt and policies of a business enterprise |
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Term
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Definition
| amount or a percentage by which the pro rata value of a controlling interest exceeds the pro rata value of a noncontrolling interest in a business enterprise, to reflect the power of control |
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Term
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Definition
| determine value by qualifying the amount of mney required to replace the future service capability of that asset |
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Term
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Definition
| expected rate of return that the market requires in order to attract funds to particular investment |
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Term
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Definition
| deducted amount pro rata share to reflect absence of some or all power of control |
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Term
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Definition
| % deducted from value due to inability to convert any interest of company into cash |
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Term
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Definition
| % deduction from value due to inability to maket the company |
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Term
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Definition
| rate of return used to convert a future monetary sum into present value |
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Term
| Discounted Cashflow Method |
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Definition
| method within the income approach whereby the present value of future expected net cash flows is calculated using a discount rate |
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Term
| Discounted future earnings method |
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Definition
| method PV of future expected economic benefits is calculated using a discount rate |
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Term
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Definition
| Earnings before: Income tax, Nonoperating income and expenses, nonrecurring income and expenses, Depreciation and amort, Interest expense or income,Owners total compensation |
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Term
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Definition
| inflows such as revenues, net income, net cash flows |
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Term
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Definition
| period of time over which property may generate ecnomic benefits |
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Term
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Definition
| owners interest in property after decuction of all liabilities |
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Term
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Definition
| cash flows available to pay out to equity holders(dividends) after funding the operations of the business enterprise, making necesary capital investments, and increasing or decreasing debt financing |
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Term
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Definition
| rate of return added to risk-free rate to reflect the additional risk of equity instruments over risk-free instruments |
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Term
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Definition
| amount of anticipated economic benefits that exceeds an appropriate rate of return on the value of a selected asset base(net tangible assets) used to generate those anticipated economic benefitis |
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Term
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Definition
| specific way of determining a value: sum of value of assets derived by capitalizing excess earnings and the value of the selected asset base |
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Term
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Definition
| price, expressed in terms of cash equivalents |
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Term
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Definition
| degree of uncertainty of realizing the expected future returns of the business resulting from leverage |
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Term
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Definition
| intangible asset that arises as a result of name reputation customer loyalty location products and similar factors not separately indentified |
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Term
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Definition
| nonphysical assets such as franchises, trademarks, patents, copyrights, goodwill, equities, mineral rights, securities, and contracts that grant rights and privileges and have value for the owner |
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Term
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Definition
| discount rate at which the present value of the future cash flows of the investment equals the cost of the investment |
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Term
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Definition
| value that an investor considers, on the basis of an evaluation or available facts to be the true or real value that will become the market value when other investors reach the same conclusion. Options: difference between the exercise price or strike price of an option |
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Term
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Definition
| sum of equity and debt in a business enterprise |
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Term
| invested capital net cash flows |
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Definition
| cash flows that are available to pay out to equity holders(in form of dividends) and debt investors( in form of principal and interest) after funding the operations of the business enterprise and making necessary capital investments |
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Term
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Definition
| % deducted from the value of an ownership interest due to loss of personnel |
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Term
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Definition
| beta reflecting a capital structure that includes debt |
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Term
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Definition
| valueation by comparing to similar assets |
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Term
| Market capitalization of equity |
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Definition
| share price of publicly traded stock multiplied by the number of shares outstanding |
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Term
| Market capitalization of invested capital |
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Definition
| market cap of equity + market value of the debt component of invested capital |
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Term
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Definition
| market value of a companys stock of invested capital divided by a company measure(ie company benfits or number of customers) |
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Term
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Definition
| ability to quickly convert to cash at minimal cost; easy transfer or slavility of an asset, business, business ownership |
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Term
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Definition
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Term
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Definition
| difference between total assets(net accum dep, depletion, and amortization) and total liabilities as the appear on the balance sheet, with respect to a specific asset, the capitalized cost less accum amort or dep as it appears on the books of account of the business enterprise |
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Term
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Definition
| total assets less total liabilities |
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Term
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Definition
| when the term is used it should be supplemented by a qualifier, ie equity net cash flows and invested capital net cash glows |
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Term
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Definition
| value of the business enterprise tangible assts minus value of liabilities |
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Term
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Definition
| assets that are not necessary to the ongoing operations of the business enterprise |
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Term
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Definition
| economic benefits adjusted for nonrecurring noneconomic or other unusual items to eliminate anomalies and or facilitate comparisons |
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Term
| Normalized financial statements |
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Definition
| Financial statements adjusted for nonoperating assets and liabilities for nonrecurring noneconomic or other unusual items to eliminate anomalies and or facilities comparison. |
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Term
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Definition
| assumption regarding the most likely set of transactional circumstances that may be applicable to the subject valuation |
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Term
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Definition
| amount or percentage deducted from the value of a business enterprise to reflect the fact that it owns dissimilar operations or assets that do no fit well together |
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Term
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Definition
| price per share divided by earningspershare |
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Term
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Definition
| amount of income(loss) and/or change in value realized or anticipated on an investment expressed as a percentage of that investment |
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Term
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Definition
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Term
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Definition
| value as of the end of the discrete projection period in a discounted future earnings model |
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Term
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Definition
| amount expressed as a percentage, earned on a company s common equity for a given period |
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Term
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Definition
| return on invested capital and return on equity |
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Term
| Sustaining CapitalReinvestment |
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Definition
| periodic capital outlay required to maintain operations at existing levels net of the tax shield available from such outlays |
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Term
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Definition
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Term
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Definition
| cost of capital determined by taking the weighted average at market value of the cost of all financing sources in the business enterprises capital structure |
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