About business valuation - book value vs. market value

Monte, Ana Paula; Fernandes, António B.; Carvalho, Juliana Filipa Teixeira

Publication

About business valuation - book value vs. market value

2019Conference paper

dc.contributor.author	Monte, Ana Paula
dc.contributor.author	Fernandes, António B.
dc.contributor.author	Carvalho, Juliana Filipa Teixeira
dc.date.accessioned	2020-04-06T10:47:09Z
dc.date.available	2020-04-06T10:47:09Z
dc.date.issued	2019
dc.description.abstract	This paper aims to develop a method that allows the evaluation of companies, according to the respective sector of activity, in a simple and fast way, comparing the value obtained through the application of the Market Value Added method with multiple Price to Sales. To obtain a fair value that reflects the expected returns based on forecast there are several methods. Each method follows its own assumptions and methodologies, with the purpose of finding the value of the company. One of widely used methods is the Market Value Added method, or MVA method, that belongs to the group of methods based on cash flows. This method consists of the current value of all future Economic Value Added (EVA). EVA is the difference between the value of the company and the total capital invested. Another method widely used is the method of multiples, which is part of the group of methods based on patrimonial approach. Each multiple has a numerator and a denominator, where the numerator can be the book value or the market value, such as the market price. On the other hand, the denominator may be a measure of equity, such as the book value of equity, or an enterprise value measure, such as operating or sales revenues. In the present paper is intended to create the multiple of price to sales for the companies of the sector of activity CAE 01 - Agriculture, animal production, hunting and related service activities, using the results obtained by the method MVA, as market price, taking into account the last 5 years of activity of the sector. Based on the obtained value, the multiple PS is determined for the activity sector. In this way, the value of a company, with this economic activity, can be determined by the multiplication of its sales by the multiple PS.	pt_PT
dc.description.version	info:eu-repo/semantics/publishedVersion	pt_PT
dc.identifier.citation	Monte, Ana Paula; Fernandes, António B.; Carvalho, Juliana (2019). About business valuation - book value vs. market value. In XX Congreso Internacional AECA. Málaga	pt_PT
dc.identifier.uri	http://hdl.handle.net/10198/21546
dc.language.iso	eng	pt_PT
dc.peerreviewed	yes	pt_PT
dc.rights.uri	http://creativecommons.org/licenses/by/4.0/	pt_PT
dc.subject	Business valuation	pt_PT
dc.subject	Market value	pt_PT
dc.subject	Book value	pt_PT
dc.subject	Market value added method	pt_PT
dc.title	About business valuation - book value vs. market value	pt_PT
dc.type	conference paper
dspace.entity.type	Publication
oaire.citation.conferencePlace	Málaga	pt_PT
oaire.citation.title	XX Congreso Internacional AECA	pt_PT
person.familyName	Monte
person.familyName	Fernandes
person.familyName	Carvalho
person.givenName	Ana Paula
person.givenName	António B.
person.givenName	Juliana Filipa Teixeira
person.identifier.ciencia-id	531F-8D14-F89E
person.identifier.ciencia-id	9215-EC79-BC43
person.identifier.ciencia-id	7C1A-9F6C-285A
person.identifier.orcid	0000-0001-9936-0142
person.identifier.orcid	0000-0002-6526-9903
person.identifier.rid	F-7469-2012
person.identifier.scopus-author-id	57202852398
person.identifier.scopus-author-id	57207923346
rcaap.rights	openAccess	pt_PT
rcaap.type	conferenceObject	pt_PT
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