Publications

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July 2001
Technical Note

Technical Note on LBO Valuation (B): The Equity Cash Flow Method of Valuation using CAPM

By: Carliss Y. Baldwin

Explains the equity cash flow method of valuation as it applies to leveraged buyouts. Also explains how to implement the changing cost of equity method using the CAPM. View Details

Keywords: Leveraged Buyouts; Forecasting and Prediction; Cash Flow; Cost of Capital; Equity; Valuation

November 2012
Technical Note

OpCo / PropCo Valuation

By: Nicolas P. Retsinas, Lisa Strope and John C. Hettinger

This technical note describes the "OpCo/PropCo" process of valuing a real estate intensive business. The term "OpCo/PropCo" refers to a business arrangement in which a consolidated, real estate-intensive enterprise is split into two separate businesses: (1) A property... View Details

Keywords: Real Estate; Property; Valuation; Investment

April 2005 (Revised February 2006)
Background Note

Note on Option Valuation

For every option, a fair price has to be established. But how do you actually price an option? Assuming a basic knowledge of options, this note covers two pricing methods: the binominal tree and the Black-Scholes/Merton formula. View Details

Keywords: Valuation; Stock Options

August 2021
Supplement

Airgas Valuation Student

By: Charles CY Wang

May 2018
Supplement

Remicade-Simponi: Valuation Supplement

By: Guhan Subramanian

16 Mar 2023
HBS Conference

Values and Valuations

February 1996
Exercise

Free Cash Flow Valuation Problem Set

By: William A. Sahlman and Andrew S. Janower

Free cash flow valuation problems: 1) build a simple pro forma, 2) value a public company's stock, and 3) evaluate a proposed LBO. View Details

Keywords: Leveraged Buyouts; Cash Flow; Public Ownership; Problems and Challenges; Valuation

February 2006 (Revised October 2006)
Background Note

Introduction to Valuation Multiples

By: Robin Greenwood and Lucy White

Outlines the definition and applicability of financial multiples and their relationship to discounted cash flow analysis. View Details

Keywords: Cash Flow; Valuation

October 2014 (Revised October 2014)
Case

Valuation Ratios in the Airline Industry, 2013

By: Paul M. Healy and Penelope Rossano

Examines factors underlying differences in valuation multiples (price-to-earnings and price-to-book) across four firms in the airline industry. View Details

Keywords: Airline Industry; Multiples; Valuation; Accounting; Air Transportation Industry

Article

Cash Take-Overs and Accounting Valuations

By: Russell Taussig and Samuel Hayes

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November 2009
Background Note

Business Valuation and the Cost of Capital

By: Timothy A. Luehrman

This note is an introduction to the cost of capital as used in discounted cash flow valuation analyses. The note covers basic financial economic principles and practical problems encountered in calculating the cost of capital, especially WACC. It concludes with... View Details

Keywords: Economics; Capital Budgeting; Cash Flow; Cost of Capital; Valuation

January 2020
Technical Note

Valuation in Entrepreneurial Settings

By: Paul Gompers

1998
Working Paper

Valuation of Bankrupt Firms

By: Stuart C. Gilson, Edith Hotchkiss and Richard Ruback

June 2015
Case

The Valuation and Financing of Lady M Confections

By: Mihir A. Desai and Elizabeth A. Meyer

This case explores the decision-making process that small, private businesses must undertake when considering an expansion and when selling equity to outside investors. In the process, students are asked to complete two exercises: a break-even analysis and a valuation... View Details

Keywords: Lady M; Bakery; Foodservice Industry; Breakeven Analysis; Restaurant Industry; Forecasting; Forecast; Financial Analysis; Borrowing and Debt; Corporate Finance; Equity; Financial Management; Financial Strategy; Finance; Food; Valuation; Food and Beverage Industry; New York (city, NY)

March 2002 (Revised April 2002)
Background Note

A Note on Pre-Money and Post-Money Valuation (B)

A brief introduction to the calculations inherent in pre-money and post-money valuations at multiple stages of financing. Relies on one example to illustrate that valuations can be calculated in a variety of ways, depending on the information provided. A rewritten... View Details

Keywords: Valuation; Financing and Loans

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December 2023
Case

The Valuation Multiple Detective

By: Jonas Heese, Paul M. Healy and Pietro Bonetti

August 2000
Teaching Note

Fixed Income Valuation (TN)

By: W. Carl Kester

Teaching Note for (9-298-080). View Details

Keywords: Consumer Products Industry

25 Mar 2021
News

Startup Hits $1.5B Valuation

Keywords: internet security; entrepreneurship; veterans; leadership; News, Library, Internet, and Other Services; Information

February 2024 (Revised February 2024)
Case

CLSA: Integrating ESG in Stock Valuation

By: Shirley Lu, Aaron Yoon and Billy Chan

In 2023, a senior financial analyst at the Hong Kong-based stock brokerage firm CLSA was surprised to see that, based on his calculations, the financial impact from climate risks on a major Indian cement manufacturing company’s projected earnings could be massive.... View Details

Keywords: Accounting; Corporate Governance; Analysis; Stocks; Valuation; Environmental Sustainability; Financial Services Industry; Industrial Products Industry; Hong Kong; China; India; Asia