Valuation Methods and Shareholder Value Creation [Hardcover]

Pablo Fernandez (Author)

Book Description

ISBN-10: 0122538412 | ISBN-13: 978-0122538414 | Publication Date: September 13, 2002 | Edition: 1

Valuation Methods and Shareholder Value Creation provides a comprehensive examination of valuation tools and guidance for analyzing and valuing a business. It covers the basics of valuation methods and shareholder value creation in addition to rigorous approaches to discounted cash flow valuation and real options for valuing a company.

By examining eight different methods of discounted cash flow valuation and discussing the pros and cons of each method, Fernández offers thorough, accessible coverage of corporate valuation. With examples and case studies from international markets, this book provides well-structured guidance for students and executives alike.

* Highlights quantitative analyses of firm value
* Emphasizes qualitative management assessments
* Integrates data from international companies

Editorial Reviews

Review

"This book is an impressive synthesis of sound theory and best practice, accessible to the novice and yet of such depth as to be compelling to the advanced practitioner. It is an important addition to the professional library of both the aspirant to senior executive positions, and to the finance specialist. Acquire it without hesitation."
--Robert F. Bruner, Distinguished Professor of Business Administration and Executive Director of the Batten Institute, University of Virginia, Charlottesville
"Pablo Fernandez's Valuation Methods and Shareholder Value Creation is an ambitious and comprehensive managerial treatment of valuation. Valuing projects and firms is critical to the work of executives, investors, bankers and others, and this book provides these decision-makers with a valuable road map through this difficult terrain."
--Peter Tufano, Sylvan C. Coleman Professor of Financial Management and Chair, Finance Area, Harvard Business School

From the Back Cover

"This book is an impressive synthesis of sound theory and best practice, accessible to the novice and yet of such depth as to be compelling to the advanced practitioner. It is an important addition to the professional library of both the aspirant to senior executive positions and to the finance specialist. Acquire it without hesitation."
-Professor Robert F. Bruner, University of Virginia, U.S.A.

"Pablo Fernández's Valuation Methods and Shareholder Value Creation is an ambitious and comprehensive managerial treatment of valuation. Valuing projects and firms is critical to the work of executives, investors, bankers, and others, and this book provides these decision-makers with a valuable road map through this difficult terrain."
-Professor Peter Tufano, Harvard Business School, Boston, U.S.A.

Valuation Methods and Shareholder Value Creation provides a comprehensive examination of valuation tools and guidance for analyzing and valuing a business. It covers the basics of valuation methods and shareholder value creation in addition to rigorous approaches to discounted cash flow valuation and real options for valuing a company.

By examining eight different methods of discounted cash flow valuation and discussing the pros and cons of each method, Fernández offers thorough, accessible coverage of corporate valuation. With examples and case studies from international markets, Valuation Methods and Shareholder Value Creation provides well-structured guidance for both executives and students.

Key Features:
 Oriented towards the needs of executives and decision-makers
 Highlights quantitative analyses of firm value
 Emphasizes qualitative management assessments
Integrates data from international companies

See all Editorial Reviews

Product Details

• Hardcover: 631 pages
• Publisher: Academic Press; 1 edition (September 13, 2002)
• Language: English
• ISBN-10: 0122538412
• ISBN-13: 978-0122538414
• Product Dimensions: 9.1 x 6.1 x 1.4 inches
• Shipping Weight: 2.4 pounds (View shipping rates and policies)
• Average Customer Review: 4.0 out of 5 stars  See all reviews (2 customer reviews)
• Amazon Best Sellers Rank: #1,896,074 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

6 of 7 people found the following review helpful:

3.0 out of 5 stars All the valuation methods that you ever wanted to read about, November 13, 2002

By 

Joseph Tham (New York, New York United States) - See all my reviews

This review is from: Valuation Methods and Shareholder Value Creation (Hardcover)

In his new book on valuation, Pablo Fernandez presents and analyzes a variety of valuation methods. The book is comprehensive in covering ALL of the methods and contains a wealth of information, data and examples on the relevant topics. The book is a valuable source for obtaining details on the different methods. However, there is a risk, although small, that the number of trees may overwhelm the reader and the reader may miss the forest.
In Part III, which is the theoretical part of the book, he examines all the various approaches for Discounted Cash Flow Valuation. In particular, Pablo Fernandez makes the unusual claim that for FCF in perpetuity with a constant growth rate of g, the discounted value of the tax shield (DVTS) is not the present value of the tax shield (PVTS). Furthermore, he defines the PVTS as follows: PVTS = T*D*Ku/(Ku - g). At first sight, this definition of the PVTS seems very strange. To obtain this result, which is in direct contradiction with the formulas in Copeland's book, he assumes that the return to levered equity Ke does not depend on whether the growth rate is zero or nonzero. This departure from the accepted definition of the PVTS may surprise those readers who are familiar with other books on valuation.
In common with other books on valuation, the examples on the cost of capital are restricted to cash flows in perpetuity. Without providing the necessary justification, the author assumes that the formulas for the cost of capital carry over to finite cash flows. The book would be strengthened if there were numerical examples that linked the discussion on the cost of capital directly to the finite cash flow statements that are derived from the usual financial statements.

5 of 6 people found the following review helpful:

5.0 out of 5 stars A great book with excellent support web site, November 17, 2002

By A Customer

This review is from: Valuation Methods and Shareholder Value Creation (Hardcover)

A great book with clear explanations and excellent support web site.
The book describes many tools on how to do the valuation (DCF, ratios, real options etc.). I particularly like the explanation of eight models of DCF. Chapters 19, 20 and 21 are the best ones I have ever read about discounted cash flow valuation.
For finance professionals, "Valuation methods and shareholder value creation" is a wonderful book to study, to keep and to look up for reference. I strongly recommend investment bankers (and clients), finance managers and MBAs to have one.
It explains Adjusted Present Value much better than Copelands and Damodaran's books. Now, I understand it!!!