Valuation Basics: Understanding the Asset Approach

The business valuation process determines the current market value (CMV) of a company. It entails in-depth qualitative and quantitative analysis of all factors impacting a business. There are three primary valuation approaches: the asset approach, the market approach, and the income approach. These approaches calculate a business value in different ways, but all strive to […]

Business Value Does Not Equal Selling Price

A common myth is that selling price equals business value. As Warren Buffett has famously quoted, “Price is what you pay; value is what you get.” What Is Business Value? Value is fundamental. The theoretical or notional value is also called fair market value. It represents the highest amount a willing and able buyer will […]