Business Valuation

Nouvelle Analytics performs objective and defensible valuations for a wide range of purposes. Our team delivers superior expertise, laser-like focus and technical skills when performing business valuations for estate and gift tax compliance, mergers & acquisitions, financial reporting, management planning, and other purposes.

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ESTATE AND GIFT TAX COMPLIANCE

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• Estate Tax Planning and Compliance Valuations 

• Gift Tax Planning and Compliance Valuations

• Valuations of Charitable Contributions

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MERGERS & ACQUISITIONS

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• Pre-Acquisition Analysis Valuations

• Fairness and Solvency Opinions

• Succession Planning Valuations

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FINANCIAL REPORTING

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• Purchase Price Allocation Valuations 

• Goodwill Impairment Testing Valuations

• Fair Value Measurement Valuations

• Built-In Gain Valuations for C Corp to S Corp Conversion

 

MANAGEMENT PLANNING

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• Buy-sell Agreements Valuations 

• Sale of a Business Valuations

• Strategic Planning Valuations

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LITIGATION

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• Shareholder Disputes Valuations

• Divorce Valuations

• Bankruptcy Valuations

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COMPLEX SECURITIES

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Valuations of:

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• Intangible Assets

• Debt Securities & Convertible Securities

• Stock Options & Warrants

• Preferred Stock

• Voting and Non-Voting Stock

• Contingent Consideration

• Personal & Enterprise Goodwill

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BUSINESS VALUATION METHODS

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Professional business valuators generally recognize three broad approaches used to value closely held businesses - the asset, market and income approaches. Each of the valuation approaches includes several underlying methods that are applied by business valuation experts when deemed appropriate based on the circumstances and facts of each business valuation engagement.

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(1) Asset Approach

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The asset-based approach is defined as a general way of determining the value of a business based on the value of its assets net of liabilities. Under this method, all tangible and intangible, recorded and unrecorded assets of the business are identified and reduced by the value of all outstanding liabilities.

 

The two main methods within the asset-based approach typically used in professional business appraisals are the Book Value Method and the Adjusted Net Asset Method.

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(2) Market Approach

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When applying the market approach, business valuation professionals base the value of a company on how similar companies, both private and public, were priced in the market in the past. Based on the identified transactions, appropriate pricing multiples are calculated, such as price-to-revenue or price-to-earnings ratios and applied to the revenue or earnings of a business being valued.  

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The four main methods, within the market approach, typically used in professional business valuations are the Guideline Public Company Method, the Merger and Acquisition Method, the Prior Sales of Interest in Subject Company Method, and the Dividend Paying Capacity Method.

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(3) Income Approach

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The income valuation approach bases the value of a business on its ability to generate future economic benefits. This valuation approach estimates the value of a closely-held business by converting the business’ future expected cash flows or earnings into a single present value. Future earnings, such as net cash flow after taxes, are projected and then capitalized or discounted to arrive at the value of the company.

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Two main calculation methods are usually utilized within the income approach, the Discounted Cash Flow Method and the Capitalization of Cash Flows Method. 

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