We've had a few years where
valuations of companies like P&G have shot up quite a bit despite no growth and they'll definitely be impacted as yields continue to rise and the market prices them back down to fair value as the dividends are no longer as appealing.
Not exact matches
Fast - growth
companies like Airbnb and Uber have raked in hundreds
of millions
of dollars in venture capital funding in the past few years, which has pushed their
valuations into never - before seen territory for startups.
That may be why WeWork has a tech - level
valuation of $ 20 billion — though skeptics question whether it should be treated
like a tech
company, given that real estate is so integral to its main product.
The lofty
valuation comes in part because
companies like HootSuite, surfing the social media wave, have been getting acquired ravenously
of late.
As Agnieszka notes, although having a high
valuation doesn't sound
like the worst thing for a startup (it is a bit
of an ego boost after - all), it could seriously harm a
company.
Over the past few years, we've seen traction: Consider VMWare's $ 1.54 billion acquisition
of AirWatch; the growth
of startup hubs
like Atlanta Tech Village and Tech Square; and
company success stories
like that
of Kabbage, which just raised $ 150 million, at an $ 875 million
valuation.
The billion - user milestone is an achievement that lots
of tech
companies dream
of,
like billion - dollar
valuations or hiring in - house DJs.
His deep - value philosophy can be boiled down to four points: he's looking for high - quality stocks that protect against the downside; he wants businesses where short - term issues have caused investors to abandon the
company; he wants to wait until
valuations are «out -
of - this - world» cheap, and he tries not to pay attention to macro issues
like eurozone debt or Chinese growth.
Galloway said
companies like Uber — with a
valuation of $ 70 billion according to recent
company press releases — would likely be worth much less if subjected to the scrutiny
of the public market.
The result is that funds have been forced to hold on to aging portfolio
companies for longer than they would
like, and growing piles
of unspent capital have ensured that competition for any new deals is intense, keeping
valuations high.
Companies like Facebook and Zynga — and Pandora — have seen ballooning
valuations as investors have rushed to snatch up as many shares as possible ahead
of what could be some
of the most high - profile tech IPOs to date.
The discussions may become tests
of whether high - profile private
companies can continue to raise new capital, even as some big names —
like Snapchat and Dropbox — have seen their
valuations marked down by mutual fund investors.
This focus on an asset's earnings power and, in particular, the ability
of assets to earn returns in excess
of desired returns is the essence
of my intrinsic
valuation, which is based on Steven Penman's residual income model.1 The basic idea is that if a
company is not earning a return in excess
of our desired return, that
company,
like the bank account example above, deserves no premium to book value.
In addition to
liking BMC's products, we
liked the
company's aggressive share repurchases and its
valuation, which is much lower than the multiple
of sales at which many similar
companies have been acquired.
Although the
company would only formally value the common stock at that price once it completes a so - called 409a
valuation — which sometimes happens shortly after an acquisition
like this, in part for tax purposes — this offer is almost certain to affect the so - called fair market value
of the
company in its next 409a review.
Because Facebook's common stock is stripped
of many
of the preferences that the stock
of investors
like DST or Microsoft has, the
valuation for the common stock will be the best indicator
of the
company's true worth at that point in time.
In that sense all analysis
of stock market based on historical metrics do nt make much sense since composition
of stocks is entirely different in different era and as more capital efficient business model evolve and their time to market cycle shrinks stocks likely to command higher
valuations and suddenly lower
valuations during short period
of time
like already happening for many technology
companies and as influence
of technology on overall cost structure
of companies increases (for example: robotics replace many
of employees cost etc)
valuation matrix
of most
companies likely to get affected dynamically in short duration
of time than in the past.
The
company says that I shouldn't focus on this number, because the 409a
valuation wasn't really a
valuation of the
company... that it didn't account for growth projections, or something
like that.
A current example is the use
of metrics
like «price per eyeball» to justify the
valuations of internet focused
companies and divert attention from the fact that on traditional
valuation metric these
companies can look very expensive.
Focusing on balance sheets and private - market
valuations of small
companies cuts through the noise sounded by volatile stock markets
like today's.
The Fund Manager will evaluate the business environment that a
company operates in, the capability
of the management to execute and scale up the business and
valuation of the
company based on fundamentals
like discounted cash flows and PE ratios, etc..
I still have many
companies I'd
like to invest in at some point in time, but
valuations will determine the timing, not the number
of positions in my portfolio.
If you add in some quality metrics (eg, to filter out miners over-investing), this tends to throw up situations where metrics
like ROE may have been impeded by some temporary setback (which might affect your
valuation models negatively), but where the underlying cash flow / quality
of earnings remains strong, or small growing
companies where cash flow is improving at a faster rate than earnings, and it's just a matter
of time before earnings (and therefore
valuation) catch up.
With a more hedge fund
like multiple
of 10 %
of AUM the
company should be worth 32M, and with 20M in assets we would get a
valuation at 52M.
The outcome is so binary, in hindsight an equity
valuation will be far too low, or high... I often notice that the market / investors can ignore debt for long periods
of time — i.e. they value a
company almost exactly
like its debt free peer.
I can't see how they warrant this
valuation at all, as they're trading up there with the
likes of companies like Visa.
I for one also
like buying a basket
of perfectly good average or above average
companies on small market or industry pull backs at low
valuations... I find these are my bread and butter and almost sure things...
Focusing on balance sheets and private - market
valuations of small
companies cuts through the noise sounded by volatile stock markets
like -LSB-...]
Now, a bidder would obviously prefer to harvest the benefit
of these savings &
valuation uplift for itself... I'm just trying to illustrate the potential underlying value
of a small
company,
like Newmark, in the hands
of an acquirer.
My interest in Gazprom was piqued by the situation in Russia (and the Ukraine), but I particularly
like the
valuation of the
company (Gazprom) as well as the general market.
This focus on an asset's earnings power and, in particular, the ability
of assets to earn returns in excess
of desired returns is the essence
of my intrinsic
valuation, which is based on Steven Penman's residual income model.1 The basic idea is that if a
company is not earning a return in excess
of our desired return, that
company,
like the bank account example above, deserves no premium to book value.
Ultimately, if the
company looks
like it's steadily executing on a turn - around (and a debt pay - down schedule), its
valuation will conversely enjoy mark - up gains well ahead
of its underlying progress.
While certain high growth
companies might be fairly valued at these levels, highly mature, low growth businesses
like WD - 40 have no history
of trading consistently at these sorts
of rich
valuations.
The identification and
valuation of these assets, which can be held in both domestic and offshore vehicles such as trusts, limited liability entities and the
like, can trigger significant discovery disputes and involve multiple
valuation experts (and the related review
of valuation reports), lengthy depositions and the related forensic accounting and
valuation of both funds and underlying portfolio
companies.