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gangsterflavor

06/29/17 1:55 AM

#35940 RE: medic79 #35939

Exactly my man! 100% on point!!
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Santes8

06/29/17 2:07 AM

#35941 RE: medic79 #35939

Hmm... that would essentially make the intellectual property worth $900M~ alone... not sure that's realistic when it currently isn't producing money yet. Has to be future dev...
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Deeznuts

06/29/17 7:45 AM

#35942 RE: medic79 #35939

Quick point. There are 3 ways to value a company.

Market Approach
Assets Approach
Income Approach

The income approach is based on the future of the company at that valuation date . Current means as of that certain date. Good analyst should perform all three and reconcile them. Asset approach is usually the lowest because it is just the value of the assets. The market approach derives value from similar publicly traded companies or historical buyouts. It is hard to use the market approach because no company is truly comparable to the one being valued. Most weight is applied to the income approach which bases the value on FUTURE CASH FLOWS.

Full Disclosure. I value privately held businesses when they are in litigation and have to be very precises for the court and to not get my ass kicked by opposing counsel. Valuations done outside of litigation are sub par and merely a suggestion or starting point for negotiation.

Hope that helps.