VALUATION ISSUE ASSIGNMENT INSTRUCTIONS Using the first four chapters in the Hitcher textbook as your primary reference, and supplemented by appropriate secondary sources, identify and discuss two (2
BUSI 534
Valuation Issue Assignment Instructions
Overview
Determining the market value of a publicly traded company can be accomplished by merely multiplying the company’s current stock price by the number of shares outstanding. This process “works” because the market, made up of millions of investors, is applying a value to the business every day in the stock trading process. Unfortunately, the process for determining the value of a private firm is not as straightforward or transparent. Private companies do not report their financials publicly, and because these firms do not have stock that is listed (and traded) on an exchange, it is often difficult to determine the value of a private company.
Nonetheless, valuations are an important part of business, company managers, creditors, and equity investors. For companies, valuations can help measure their progress and success, and can help them track their performance in the market compared to others. Investors can use valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who is using the valuation, it essentially describes the company's worth.
Hitchner, J. (2017). Financial valuation: Applications and models (4th ed.). Hoboken, NJ: Wiley. ISBN 978-1-119-28660-8
Instructions
Using the first four chapters in the Hitcher textbook as your primary reference, and supplemented by appropriate secondary sources, identify and discuss two (2) specific issues or challenges that valuation professionals face when attempting to properly assess the current value of a private business. Your paper should have an Introduction, two “body” parts (specific issue or challenge one and specific issue or challenge two) appropriately titled, and a Conclusion. The body parts need to clearly define the issue/challenge, fully discuss why this issue/challenge is important, and suggest what valuation professionals can do to limit the impact of the issue/challenge.
Assignment length: At least 750 words (excluding title page and references) in current APA format.
Number of citations: At least 3 (in addition to your textbook, which must be your primary references). Remember: any article/source listed in your references must be cited at least once in your paper.
Accepted sources: Books or other scholarly/professional sources. Remember, Investopedia, Wikipedia, websites, periodicals (e.g., newspaper, magazine, newsletters), and blogs are not scholarly/professional sources. You can use these in your paper (if properly cited), but they do not count towards the required number of citations.
Note: Your assignment will be checked for originality via the Turnitin plagiarism tool.
