The thesis deals with the topic of terminal value assessment in DCF models. Examining ten different techniques, the parameters behind, and the possible perils, its aim is to formulate the best practice for terminal value estimation. Afterwards, eleven of real business valuations are analyzed with the previously formulated best practice serving as a benchmark. Where possible, the impact of departures from the best practice on the estimated business value is quantified. The analysis confirms the hypothesis that practical terminal value assessments often diverge substantially from the best practice, which has a material impact on the resulting business value estimate.

PURPOSE- This paper empirically evaluate the ability among various types of parsimonious equity valuation models in order to ascertain which model represents the value of equity the best and thereby manage to withstand factors causing valuation errors. The more complicated models applied, the more underlying assumptions are needed. The trade-off here, which will be investigated, is if the benefit of using more difficult models outweighs the cost of including the extra assumptions. Further on the empirical research´s results will be compared with the results provided by this previous studies examinating American companies. METHOD- Six valuation models using a discounting valuation method are evaluated; the Present Value of Expected Dividends (PVED), Residual Income Valuation (RIV), Residual Income Valuation Terminal Value Constrained [RIV(TVC)], Abnormal Earning Growth approach (AEG), Abnormal Earning Growth Terminal Value Constrained approach [AEG(TVC)]  and Free Cash Flow to the Firm model (FCFF). The five latter investment models are all based on the first model. FINDINGS- The aim of finding the smallest absolute valuation error in the empirical study is given to PVED, a model including little underlying assumptions and inputs. Hence, the implication of the application of valuation models can be summarized as that there are no clear benefits of applying complex models for Swedish companies, and the trade-off between using more complex models and thereby including more assumptions is not compelling given that the benefit does not exceed the cost. All the earnings methods are all found to be superior to the FCFF model, while the constrained RIV and AEG methods provide higher valuation errors than the unconstrained versions. The superiority of the PVED model is inconsistent with the previous results examining American firms, in which the RIV model is preferred. One of the reasons for the difference is the use of different accounting standards in the counties, and thereby the companies´ capital structure and the inputs used in the investment valuation may be somewhat unlike.

The objective of a business valuation arrangement is to reach a reasonable and acceptable opinion of value. Valuing a business entity has become less of a guessing game than before. Business valuations are two thirds science and one third art according to several theorists and practitioners. The result of a valuation is only definite if it can accurately predict the future, and given that it is not possible, there will always be an element of risk that the actual value differs from the expected estimate. There are several reasons why business valuations need to be performed. They can be categorised into three groups, namely transaction-based, tax-based, and litigation-based. Most business entities will require a business valuation at some stage. Business valuations can be categorized into different approaches and methods. The three approaches comprise the income based valuation approach, the market derived valuation approach, as well as the asset based valuation approach. Each one of these approaches has different methods that can be used under them. For the purpose of this research study, the methods used under the income based valuation approach are the discounted economic income valuation method and the direct capitalisation valuation method. The guideline publicly traded business entity valuation method and the merger and acquired business entity valuation method are used under the market derived valuation approach. When performing a business valuation under the asset based valuation approach, the asset accumulation valuation method and the capitalised excess earnings valuation method are used. In this research study a business valuation is going to be performed on a franchised restaurant, namely a Spur Steak Ranch. The particular Spur Steak Ranch that is going to be used is the Tampa Bay Spur. A franchise is a right granted to individuals or groups to market a business entity‟s products or services within a particular location. Franchising is a method of expanding a business entity on less capital than would otherwise be possible. The franchisee pays a capital lump sum to enter the franchise and accepts some of the running costs of its outlet. In addition, the franchise offers the franchisee the use of the franchise name and any goodwill related with it, the use of its business structures and support services, its product or service to sell, as well as management and staff training programmes. Franchising has become a dominant force in the distribution of products and services in several parts of the world. Any facility that prepares separate meals for eating on or off the premises falls under the title „„restaurant.‟‟ Not one restaurant is the same, and by producing meal experiences with unique characteristics, restaurants accommodate the requirements of particular customer categories. A restaurant is as much a financial entity as any other business entity. The most important elements in profitability in restaurants are economy and productivity. The franchised restaurant used in this research study is the Spur Steak Ranch which has been in South Africa for over 40 years. Allen Ambor, the founder and executive chairperson of Spur, is the person who started it all in 1967 when he invested R4,000 to open the Golden Spur in Newlands, Cape Town. Today, Spur restaurants are very popular for having play areas for children, thus, entertaining the whole family, making Spur a very popular fully-licensed franchised restaurant. The particular Spur Steak ranch used in this case study is the Tampa Bay Spur. The Tampa Bay Spur Steak Ranch is a family-oriented franchised restaurant, based on the widely known Spur concepts. The restaurant is owned by Lungisa Financial Administrators and is located in the Time Square Building, Dias Road, in Jeffrey‟s Bay. The restaurant spans in the region of 550m2 and can accommodate up to 180 customers. The Tampa Bay Spur was taken over by new owners in December 2011 and also completed a revamp that ended in March 2011. The research question and objective in this research study is to find out what combination of valuation approaches and methods seems to be the most reliable and accurate to value a franchised restaurant, particularly, a Spur Steak Ranch, and more specific the Tampa Bay Spur. To achieve this objective, five secondary objectives must be carried out. The first objective is to critically evaluate and compare popular valuation approaches and methods with each other. The second objective is to deliberate the advantages and disadvantages of each of the methods. Thirdly, to point out the uncertainty factors in valuations, for example, to calculate the discount rate by using the WACC or CAPM formula. The fourth objective is to develop an empirical case study based on actual information of a selected Spur (Tampa Bay Spur) and comparing different valuation approaches and methods with the original amount calculated by Spur after performing a business valuation on the Tampa Bay Spur. The fifth and last objective is to make recommendations regarding the valuation method used by the Spur. After performing a business valuation on the Tampa Bay Spur by using several valuation approaches and methods, calculating an average value from the different approaches and comparing it to the original value that the Spur calculated after performing a valuation on the Tampa Bay Spur, a conclusion can be made that the valuation method used by the Spur is fair and reliable. However, the method used by the Spur does not give enough insight for the buyer and seller to understand how they calculated the final value and needs improvement. / Thesis (M.Com. (Management Accountancy))--North-West University, Potchefstroom Campus, 2012.

The objective of a business valuation arrangement is to reach a reasonable and acceptable opinion of value. Valuing a business entity has become less of a guessing game than before. Business valuations are two thirds science and one third art according to several theorists and practitioners. The result of a valuation is only definite if it can accurately predict the future, and given that it is not possible, there will always be an element of risk that the actual value differs from the expected estimate. There are several reasons why business valuations need to be performed. They can be categorised into three groups, namely transaction-based, tax-based, and litigation-based. Most business entities will require a business valuation at some stage. Business valuations can be categorized into different approaches and methods. The three approaches comprise the income based valuation approach, the market derived valuation approach, as well as the asset based valuation approach. Each one of these approaches has different methods that can be used under them. For the purpose of this research study, the methods used under the income based valuation approach are the discounted economic income valuation method and the direct capitalisation valuation method. The guideline publicly traded business entity valuation method and the merger and acquired business entity valuation method are used under the market derived valuation approach. When performing a business valuation under the asset based valuation approach, the asset accumulation valuation method and the capitalised excess earnings valuation method are used. In this research study a business valuation is going to be performed on a franchised restaurant, namely a Spur Steak Ranch. The particular Spur Steak Ranch that is going to be used is the Tampa Bay Spur. A franchise is a right granted to individuals or groups to market a business entity‟s products or services within a particular location. Franchising is a method of expanding a business entity on less capital than would otherwise be possible. The franchisee pays a capital lump sum to enter the franchise and accepts some of the running costs of its outlet. In addition, the franchise offers the franchisee the use of the franchise name and any goodwill related with it, the use of its business structures and support services, its product or service to sell, as well as management and staff training programmes. Franchising has become a dominant force in the distribution of products and services in several parts of the world. Any facility that prepares separate meals for eating on or off the premises falls under the title „„restaurant.‟‟ Not one restaurant is the same, and by producing meal experiences with unique characteristics, restaurants accommodate the requirements of particular customer categories. A restaurant is as much a financial entity as any other business entity. The most important elements in profitability in restaurants are economy and productivity. The franchised restaurant used in this research study is the Spur Steak Ranch which has been in South Africa for over 40 years. Allen Ambor, the founder and executive chairperson of Spur, is the person who started it all in 1967 when he invested R4,000 to open the Golden Spur in Newlands, Cape Town. Today, Spur restaurants are very popular for having play areas for children, thus, entertaining the whole family, making Spur a very popular fully-licensed franchised restaurant. The particular Spur Steak ranch used in this case study is the Tampa Bay Spur. The Tampa Bay Spur Steak Ranch is a family-oriented franchised restaurant, based on the widely known Spur concepts. The restaurant is owned by Lungisa Financial Administrators and is located in the Time Square Building, Dias Road, in Jeffrey‟s Bay. The restaurant spans in the region of 550m2 and can accommodate up to 180 customers. The Tampa Bay Spur was taken over by new owners in December 2011 and also completed a revamp that ended in March 2011. The research question and objective in this research study is to find out what combination of valuation approaches and methods seems to be the most reliable and accurate to value a franchised restaurant, particularly, a Spur Steak Ranch, and more specific the Tampa Bay Spur. To achieve this objective, five secondary objectives must be carried out. The first objective is to critically evaluate and compare popular valuation approaches and methods with each other. The second objective is to deliberate the advantages and disadvantages of each of the methods. Thirdly, to point out the uncertainty factors in valuations, for example, to calculate the discount rate by using the WACC or CAPM formula. The fourth objective is to develop an empirical case study based on actual information of a selected Spur (Tampa Bay Spur) and comparing different valuation approaches and methods with the original amount calculated by Spur after performing a business valuation on the Tampa Bay Spur. The fifth and last objective is to make recommendations regarding the valuation method used by the Spur. After performing a business valuation on the Tampa Bay Spur by using several valuation approaches and methods, calculating an average value from the different approaches and comparing it to the original value that the Spur calculated after performing a valuation on the Tampa Bay Spur, a conclusion can be made that the valuation method used by the Spur is fair and reliable. However, the method used by the Spur does not give enough insight for the buyer and seller to understand how they calculated the final value and needs improvement. / Thesis (M.Com. (Management Accountancy))--North-West University, Potchefstroom Campus, 2012.

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The goal of the thesis is to evaluate the company Golf Club Český Krumlov a.s. with discounted cash flow method. The thesis will be classified into chapters, which will be devoted into strategic analysis, financial analysis, value divers, financial plan and final valuation. The output of the thesis is complete valuation, where theoretical knowledge gained from previous studies will be used for the evaluation of real company.

A research report in partial fulfilment of the requirements for the degree of Masters of Science in Engineering submitted to the Faculty of Engineering and the Built Environment, University of the Witwatersrand, 2019 / Mining operations are by nature capital intensive. Historically mining companies have in general been poor at capital allocation decision making, which translated in poor returns on capital invested and impairments. Better capital allocation strategies are required for mining companies to unlock more value from invested capital. This research focussed on identifying factors to consider during the capital allocation decision-making process that can potentially unlock value in mineral projects. The research included a review of capital allocation decisions and performance of five mining companies from 2001 to 2017. This period covers one full commodity price cycle to determine the impact of the prevailing commodity price on capital allocation decisions. Through analysis of the historical capital allocation of the five mining companies the research aimed to test if it is possible to unlock value by allocating capital in a counter cyclical approach compared to the prevailing commodity prices. From the analysis of the historical capital allocation decisions made by five mining companies a number of common trends were identified. The research found that during a period of higher commodity prices, mining companies focussed primarily on volume growth. This is confirmed by a strong correlation between the value of capital approvals and the average commodity prices of the basket of minerals produced. The higher allocation of capital towards growth initiatives, such as expansionary capital and acquisitions, have in a number of instances resulted in significant capital over-expenditures in projects. The over-expenditures have directly contributed to a number of impairment charges made by the diversified mining companies during a declining commodity price cycle. Conversely, during periods of declining commodity prices mining companies focused on rationalisation of mining projects and operations and disposal of assets that do not meet minimum investment criteria. During these periods capital allocation towards growth projects were reduced, with most capital allocated to reduction of net debt on the balance sheet. The research found a common trend of higher capital allocation towards growth projects during historical high commodity prices, and during subsequent lower commodity prices capital allocation was directed towards reduction of net debt and disposal of loss making assets. Results from the research conducted on the five mining companies indicated that there may be correlation between return on investment and the timing of the capital investment in relation to the position on the commodity price cycle at the time of the investment. However, the results obtained for the five mining companies were influenced by operational returns from existing operations, which makes it difficult to determine returns realised on incremental capital expenditures. From the results obtained from the analysis the following recommendations are made for a capital allocation strategy to increase the probability of unlocking value over the long term. Firstly, a company should have a clear capital allocation framework that is guided by the mining company’s strategic objectives. The framework should clearly indicate the hierarchy of importance when allocating capital to different areas. Secondly the company should clearly identify the minimum investment criteria to be met before capital is allocated to an investment. Lastly the mining company should aim to consistently invest capital throughout the commodity price cycle, and be cautious of over allocating capital towards growth projects during periods of high commodity prices. / TL (2020)

Owners wishing to sell their business have a number of alternative exit routes. In a UK context, they may opt for a public sale of their shares either through the London International Stock Exchange, main market or on the AIM. Alternatively, they may choose a private sale route i.e. MBO or trade sale. This study aims to investigate the connection between the financial characteristics of firms and their choice of exit route. In particular company capital structure and valuation measures are used to discriminate between alternative exit routes and explain the rationale and factors for such segmentation in the market for corporate control. This research uses a discriminatory model to classify the preferred type of realisation route for a firm based on its financial characteristics. A classificatory accuracy better than that obtained by chance provides evidence of some segmentation of alternative disposal routes. A further aim is to consider the role of the large corporate finance advisory industry, which obtains large fees for their proficiency in disposal in the correct market. An attempt has therefore been made to see whether particular types of companies are suited to particular markets on the basis of their financial characteristics and whether this corresponds to actual outcome. We also investigate and evaluate the opportunity cost of misclassification both by the models and by the advisors. The results, in general, suggest that size and capital structure emerge as important discriminators. However, growth and working capital management were also found to contribute in discriminating between the suitability of particular companies for given exit routes. Our investigation demonstrates that discriminant (and logistic regression) models can assign cases to particular markets on the basis of financial attributes at above chance frequency and substantial valuation differences between the various markets are evident. Attention is also given to the opportunity costs involved in differences between indicated and chosen exit route. The results show that out-performing as well as under-performing misclassification errors occur and that the status of advisor seems to play a discussible role.

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