"Over 20 years, technology and technique have greatly improved the ability to price targets accurately."

Jay B. Abrams' expert opinion is quoted in this CFO magazine article about the importance of valuation in mergers and aquisitions:

"Adding to the improvement have been advanced cost-of-capital methodologies, notes Jay B. Abrams, president and CEO of North Hollywood, California-based Abrams Valuation Group Inc. For instance, analysts can now adjust discount models for special cases, such as nonpublic companies and smaller targets. "Large firms are more stable and small firms more volatile," says Abrams. "So for smaller firms, you should be using much higher discount rates" than the CAPM would yield. Newer methods, such as the Fama-French three-factor model, do a better job of capturing such subtleties."

To read the whole article see: http://www.cfo.com/article.cfm/3709802.