Business Valuations made easy for Unlisted Business. Automated Cash Flow, NPV, IRR, MIRR with PE Ratio

Powerful simplistic Business Valuation & Analysis Model for Unlisted Businesses (Unlevered and Levered)

Original Best Practice:  Business Valuations made easy for Unlisted Business. Automated Cash Flow, NPV, IRR, MIRR with PE Ratio  by Anthony Van Rensburg

Description
This Business Valuation Model is suitable for all types of unlisted Businesses. The stark reality is that all funders, analysts, and prudent investors operate on the same basis. They need to know the historical IRR and MIRR and assess whether these returns will exceed the funder's rate (hurdle rate) multiple times. The more the better. Each Industry type will have a different risk profile therefore the PE Ratio applied will differ from business to business. The Model only requires basic input such as basic Assets that are included in the prospective sale, the past 5-year NPAT results, and various mitigating factors such as future prospects and excessive drawings by the previous owner. Once these input fields are complete, the Business Valuation Model will automatically calculate the cash flows without any inflationary growth, and calculate the NPV, IRR, and MIRR over form a 3 to 10-year period. These are the pertinent facts that determine if the business is valued correctly. How often will the IRR and more importantly MIRR exceed the funder's rate? The most important factor anywhere on the globe is that the price must make sense when ungeared (cash sale) and how much gearing will be available due to the profitability. The model has an automated loan amortization built into the model which will help factor in the effects of gearing for a buyer proposition. So, for Sellers, Buyers, Business Brokers, and Funders, this model is compact and gets straight to the point.

This Best Practice includes
Excel Template

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Further information

A fast model designed to help you find the correct business value on any unlisted business. Limited knowledge requirements. The Value ascribed must produce IRR and MIRR returns that exceed the hurdle rate by as many times as possible according to the riskiness of the business, and this you will get to in less than 10 minutes if you have the data with you.

This Business Valuation Model cuts through most of the unnecessary jargon and is suitable for valuing any type of business that has the historical performance to input into the fields. It may also be used to project NPV, IRR and MIRR against fictional or future earnings. An excellent model to provide to funders if required. They will immediately view the NPV, IRR and MIRR and make a quick decision.

This is not a start-up business model, it is best suited to value a business that is a going concern. It is also not suitable for listed companies.


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