Jay B. Abrams
0-07-000215-0 · hardcover · $95.00
"A must read for the serious business appraiser." -Jay E. Fishman, Editor, Business Valuation Review and Past Chairman of the American Society of Appraisers.
A rigorous and eye-opening treatment filled with applications for a wide variety of scenarios in the valuation of privately held businesses, Quantitative Business Valuation emphasizes regression analysis of real world transactions: stock market returns, restricted stock discounts, and fractional interest discounts from net asset value in the secondary limited partnership market.
The book is organized into five segments. The first three follow the chronology of a valuation: forecasting cash flows, discounting to present value, and adjusting for control and marketability. In the fourth, Abrams assembles the pieces of the puzzle to present a unique and unified approach to valuation-one that can be empirically tested and applied to firms of virtually any size-along with a discussion of measuring valuation error. He concludes by covering special topics: valuation of startups, measuring the dilution in value that occurs in sales to Employee Stock Ownership Plans (ESOPs), and analysis of company buyouts of partners and shareholders (which draws upon results from ESOP valuations).
The resulting work, solidly grounded in economic theory and including all necessary mathematics, integrates existing science into the valuation profession-and develops valuation formulas and models that professional practitioners will find useful on a daily basis. A representative-but far from exhaustive-listing of other business valuation topics covered include:
Mathematical derivation of cash flow · Using regression analysis · Annuity Discount Factors · Superiority of arithmetic mean · Empirical evidence of the size of control premium · Testing 5 models for restricted stock discounts · Economic Components Model for Discount for Lack of Marketability · Regression of The Partnership Spectrum data · Empirical tests of Abrams' valuation theories · Valuing startups · Measuring and apportioning dilution in ESOPs
This book has a 5-Star Rating on www.amazon.com.
“Jay Abrams’ book is close to the equivalent of several graduate dissertations rolled into one book. For each topic (covered), he presents a scholarly summary of past research, new empirical research of his own, and his conclusions. It is a well-documented contribution to in-depth understanding of important business valuation issues, and should not be overlooked by the serious practitioner.”
— Shannon Pratt, DBA, Shannon Pratt Valuations, Co-Author, Valuing a Business and author of numerous other valuation books.
“While a proliferation of business valuation treatises and guides exists in the market, most are very general in nature and do nothing more than rehash fundamental concepts. I am unaware of any author that has stepped into the unknown as Jay Abrams has and compiled and developed a treatise of extremely useful analytic tools for the serious valuator.”
— Robert J. Grossman, CPA/ABV, ASA, CVA, Partner, Grossman Yanak & Ford.
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