Over the last twenty years, the worldwide number of public mergers and acquisitions has grown at a compound annual growth rate of 3.3%. In each transaction, acquirers and valuing parties including corporations, investment banks, and buyout funds value target firms using a variety of methodologies. This paper provides evidence in favor of trailing twelve months percent revenue growth as a multiple for valuation. Using the last twenty years of public mergers and acquisitions available on S&P’s Capital IQ, this paper finds that revenue growth is a consistently significant predictor of a target firm’s purchase multiple, measured as its enterprise value divided by revenue. Further, this paper finds no evidence that trailing twelve months percent revenue growth is more significant during economic bubbles, and that the effect is largely mitigated within the technology sector.

This research project investigated the impact of education on an entrepreneur’s opportunity and threat identification skills through the environmental scanning activities and modes that the entrepreneur adopted. The aim of the research was to identify the types and levels of education which entrepreneurs should have in order that they can scan their environments effectively and achieve high growth rates. South Africa, like other developing countries, has a dire need to address poverty. Entrepreneurship is seen as a vehicle for poverty alleviation and socio-economic empowerment (Schlemer & Hudson, 2004) and a means of enhancing South Africa’s global competitiveness (Rogerson, 2004). The research was conducted with a view that it would contribute to the lessons of how to achieve entrepreneurial success. The study was conducted using quantitative research methodology. The target population was entrepreneurs in South Africa, within the Information Technology, Construction and Advertising industries. The study found that entrepreneurs with a secondary education scanned less effectively than entrepreneurs with tertiary qualifications. This finding is synonymous with low income countries where there is pressure to develop businesses. The research also found that entrepreneurs with a science background scanned the environment more than entrepreneurs with other qualifications and achieved higher revenue growth levels than other entrepreneurs. Copyright / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

abstract: This dissertation assesses the impact of revenue diversification on state revenue growth and volatility and then, the economic, political and institutional factors that predict diversification. Previous studies, taking advice from modern portfolio theory, argue that diversifying a revenue portfolio can stabilize volatility and even lead to faster rates of growth over time. However, levels of diversification are not assigned randomly. Rather, differences among states in diversification might be a consequence of differences in states such as electoral cycles and the presence and strictness of tax limitations. Thus, the research question is: Whether or to what extent has diversification increased revenue growth and decreased volatility when the endogeneity of diversification is considered? Using two-stage least squares and fixed-effects regression models with the data of the 50 states from 1980 to 2011, I examined the impact of diversification, reflecting a state's own political and institutional characteristics (i.e., endogeneity), on growth and volatility. I found diversification was positively related to growth, but a diversified portfolio does not smooth volatility. Furthermore, I found that the level of revenue diversification increased in each year of legislators' terms and decreased in every year of governors' terms. These findings imply that legislators and governors have different preferences for diversification, perhaps due to different opportunities to enhance their reelection prospects. I then investigated the relationship between political leaders' year of the terms and changes in specific revenue sources, the biggest set of reelection opportunities. Selective sales and income taxes were negatively related to every year of legislators' terms. General sales taxes, corporate income taxes, and charges are positively related to every year of governors' terms. The results suggest that legislators focus on their districts or specific interest groups, closely associated with selective sales taxes. In contrast, governors' constituency-driven preferences lead them to be responsible for broader issues such as balancing the state budget, thereby using general sales taxes and charges as methods to do so. As a consequence of these political factors, levels of diversification will change, thereby influencing revenue growth and volatility. / Dissertation/Thesis / Ph.D. Public Administration 2013

Thesis (MBA (Business Management))--University of Stellenbosch, 2010. / ENGLISH ABSTRACT: Despite growth being the target of all business operations, there is a concrete limit to growth. The concept of a sustainable cash flow growth rate is an important consideration, since it alerts management to cash flow shortfalls caused by a too-high growth rate. The company Homechoice Holdings Limited was chosen as the subject of this research report as it exhibited unusually high revenue growth, linked to a high share price and a subsequent cash shortfall. The tool of a sustainable growth rate model was employed to investigate whether the shortfall in cash could have been averted if the cash flow sustainable growth rate (CFSGR) had been adhered to. A selection of existing sustainable growth rate models is presented and their different emphases are discussed. This is followed by the development of a sustainable growth rate formula, which is applied to five general cases. In case 1, there is a dividend, depreciation, fixed expenses as well as a change in the working capital cycle (WCC). In case 2, depreciation, fixed expenses and a change in WCC are evident, but the dividend is zero. In case 3, depreciation and a change in WCC are evident, but dividend and fixed expenses are zero. In case 4, all items are zero excepting a change in WCC. In the final case, 5, all items are zero. The published financials of the years 1996-2000 are analysed in detail and the market reaction (share price and press reaction) is portrayed. Lastly the actual developments of the profits and the share price are compared with a hypothetical case in which the previously defined CFSGR would have been used. In conclusion the issue of the CFSGR is contextualised with other information which contributed to the decline of this company. / AFRIKAANSE OPSOMMING: Hoewel groei die teiken van alle sakebedrywighede is, het groei ’n konkrete limiet. Die konsep van ’n volhoubare kontantvloei-groeikoers is ’n belangrike oorweging omdat dit bestuur waarsku wanneer daar kontantvloeitekorte is wat veroorsaak word deur ’n groeikoers wat te hoog is. Die maatskappy Homechoice Holdings Beperk is as onderwerp van hierdie navorsingsverslag gekies as gevolg van sy buitengewoon hoë inkomstegroei wat aan ’n hoë aandeelprys en ’n gevolglike kontanttekort gekoppel is. ’n Volhoubare groeikoersmodel word as hulpmiddel gebruik om ondersoek in te stel of die kontanttekort verhoed kon word indien die maatskappy die kontantvloei volhoubare groeikoers (CFSGR) gebruik het. ’n Seleksie van bestaande volhoubare groeikoersmodelle word aangebied en die verskillende elemente wat hulle beklemtoon word bespreek. Dit word gevolg deur die ontwikkeling van ’n volhoubare groeikoersformule wat op vyf algemene gevalle toegepas word. In geval 1 is daar ’n dividend, depresiasie, vaste koste sowel as ’n verandering in die bedryfskapitaalsiklus. In geval 2 is depresiasie, vaste koste en ’n verandering in die bedryfskapitaalsiklus voor die hand liggend, maar die dividend is nul. In geval 3 is depresiasie en ’n verandering in die bedryfskapitaalsiklus voor die hand liggend, maar dividende en vaste koste is nul. In geval 4 is alle items nul buiten ’n verandering in die bedryfskapitaalsiklus. Laastens, in geval 5, is alle items nul. Die gepubliseerde finansiële jaarstate van 1996 tot 2000 word breedvoerig ontleed en die markreaksie (aandeleprys en mediareaksie) word aangetoon. Laastens word die werklike ontwikkeling van die winste en die aandeleprys met ’n hipotetiese geval vergelyk waarin die CFSGR, wat vroeër gedefinieer is, gebruik is. Die kwessie van die CFSGR word ook in ’n konteks geplaas saam met ander inligting wat tot die agteruitgang van hierdie maatskappy bygedra het.

A shift in focus from growing revenues towards managing working capital could be observed in many companies in the recession that followed the financial crisis of 2008. This thesis therefore investigates the relation between working capital management (WCM) and revenue growth by examining 36 Swedish companies within the IT & Telecom, Wholesale, and Manufacturing industries. The results show that there currently is a general gap between the perceived and actual performance regarding WCM and the effects on revenue growth. The studied companies report a belief that no trade-off between WCM and revenue growth exists. However, the actual performance in the studied industries indicates that increases in revenues often are not justifiable in proportion to the increases in net working capital (NWC). The study also shows that responsibility for WCM and implementation of WCM decisions are to a high extent assigned to a centralized organizational level. Recommendations derived from this study are that while companies need a centralized responsibility for WCM decisions, the responsibility also needs to be decentralized for successful implementation. Furthermore, the NWC development in relation to revenue growth needs to be continually monitored.

Retail store closures are on pace to pass those during the 2008 recession; meanwhile, consumer confidence is strong and unemployment is low.This puzzling situation sparks the question of how retailers can change their current business models and tactics to capitalize on a stronger economy and changing consumer preferences. Key solutions may lie in the strategies and decisions of America’s fastest growing retailers. The purpose of this study is to identify and understand common trends that are driving revenue growth in today’s consumer retail companies. The study produces characteristics useful for struggling retailers to develop and adapt in hopes of achieving growth and stability in the changing retail sector. The research design is a collection of variables from two data sets, one made up of 220 U.S. retailers and the other including the top 50 fastest-growing publicly traded U.S. retailers. This data comes from respective 10-K annual reports. The data is analyzed using STATA to identify strong trends and correlations among the top players in the retail space. Some notable characteristics are revenue in dollars, revenue growth percentages, gross margin percentages, square footage, employee count and sales ratios in dollars.

Den svenska vård-och omsorgsmarknaden har sedan dess avreglering för ca 20 år sedan utvecklats. Från att ha varit ett offentligt monopol har vi nu istället en starkt konkurrensutsatt marknad. Konkurrensfördelar som tillväxtstrategi kan nu vara avgörande för ett bolags framgång. Genom en närmast unik möjlighet att ta del av bolagsdata från ett av Sveriges största vård- och omsorgskoncerner har denna studie undersökt huruvida organiska eller oorganiska tillväxtstrategier lämpar sig bäst för vård- och omsorgsbolag som ämnar öka sin omsättning på ett kapitalmässigt effektivt sätt. Datat som tillhandahölls sträckte sig över fem år och innefattade 56 bolag. Studien genomfördes i form av två analyser. En kvantitativ regressionsanalys för att ta fram ett jämförelsetal motsvarande omsättning per krona spenderad i organiska investeringar och en delvis kvantitativ analys för att ta fram ett jämförelsetal motsvarande omsättning per krona spenderad i oorganiska investeringar. Analyserna visade sammanlagt att oorganiska tillväxtstrategier enligt datat är mer kapitalmässigt effektiva med avseende till omsättningstillväxt än organiska tillväxtstrategier. Studien tog dock bland annat inte hänsyn till potentiella synergieffekter från förvärv eller riskprofilen förknippad med de olika strategierna. Det framgick även från datat att investeringar i personal är positivt korrelerad med omsättningstillväxt, medan det inte gick att påvisa en korrelation mellan omsättningstillväxt och investeringar i IT eller generella investeringar. / The Swedish welfare industry has since its deregulation 20 years ago evolved. What was previously a publicly owned monopoly is now a competitive market. Competitive advantages such as growth strategies is now a key for a company’s success. Through an almost unique opportunity to use data from one of Sweden’s largest welfare groups this study has investigated whether organic or inorganic growth strategies is best suited for welfare companies looking to increase their total revenue in an, in terms of capital, effective way. The data provided spanned over five years and included data from 56 companies. The study was conducted as two separate analyses. A quantitative regression analysis was made to calculate a comparison number corresponding to revenue per SEK spent on organic investments. The second, in part quantitative analysis aimed to create a corresponding number for inorganic investments. The conclusion from the analyses was that according to the data, the inorganic growth strategies outperformed the organic growth strategies. The study did however not consider the potential synergy effects from acquisitions or the risk profile associated with the strategies. The study also revealed that according to the data investments in staff is positively correlated with revenue growth, but a correlation between revenue growth and both investments in IT and general investments could not be proven.