Is valuation still valid after routine destruction of workpapers?
Case law analysis: Lawton v. Bank of America Corp., 2010 WL 1508922 (D.R.I.)(April 14, 2010) For nearly 15 years the value of stock in a manufacturing company has been the focus of fractious litigation between the beneficiaries of an estate and the co-executor (Bank of America Corp.). The stock was admittedly the estate’s most valuable asset; [...]
More patents than ever…but what does this mean for IP value?
The US Patent and Trademark Office’s high patent grant numbers continue. “The past two weeks respectively rank Nos. 1 and 2 in terms of the most patents granted in a single week in US history,” reports Patently-O, a patent law blog BVWire’s editors follow What does this mean for IP value? It certainly means more [...]
SEC filings essential when analyzing guideline public company comps
There are common errors on the GPCM, as highlighted by Rob Schlegel, speaking at today’s BVR/PitchBook webcast. Obviously, you need to chose matches carefully for size, market niche, characteristics and other factors. ”We see a lot of failures to analyze the data,” agrees Linda Trugman. ”there isn’t enough analysis done and multiples are picked [...]
Tax Court uses its own weighted approach to discount an undivided real property trust
The facts in the new decision by Judge Halpern of the US Tax Court, Ludwick v. Commissioner, are as follows: A California couple owned a vacation home on Hawaii’s Big Island as tenants in common. In 2005, they transferred their separate, one-half interests into a qualified personal residence trust. At the time, the Hawaii property [...]
FLP experts take at in-depth look at complicated ownership arrangements
Discounts for lack of marketability and adjustments for minority interests are tough enough, but when the when limited partnership structures get complicated, with multiple ownership “tiers,” these adjustments can take on a life of their own. On May 27, William Frazier (Howard Frazier Barker Elliot) and John Porter (Baker Botts) will address these valuation challenges [...]
A mathematical view of the Butler Pinkerton Calculator
Gary Schurman (Applied Business Economics) discusses the derivation of the theory behind the Butler Pinkerton Calculator in his article, “Derivation of The Butler-Pinkerton Model.” Schurman presents the financial theory behind a private company beta (also known as total beta or adjusted total beta) to account for sub-optimal diversification (no diversification or partial diversification). Click here [...]
Cimasi: “Wal-martization” of healthcare affecting physician practice valuations
Healthcare valuation expert Robert Cimasi (Health Capital Consultants) gave a detailed and lively update on emerging issues in healthcare valuation at the AAML/AICPA conference in Las Vegas last week. Cimasi outlined “Four Pillars of the Healthcare Industry” that are impacting the transactional valuation of healthcare enterprises: Reimbursement: e.g. there is a current downshift in reimbursement [...]
Damodaran updates equity risk premiums studies
Professor Aswath Damodaran (Stern School of Business, New York) updated his article Equity Risk Premiums (ERP): Determinants, Estimation and Implications to include data through the end of 2009. In the article, he investigates: the three basic approaches used to estimate equity risk premiums – the survey approach, where investors or managers are asked to provide [...]
Maggio and Seigneur provide exec compensation source checklist for reasonable compensation “build-ups”
Sharyn Maggio (Maggio & Co.) and Ron Seigneur (Seigneur Gustafson) addressed new developments in the reasonable compensation area at the AAML/AICPA conference last week in Las Vegas. Seigneur advised: “When trying to determine reasonable compensation for owner/employees, it is really important to figure out exactly what their real duties are. Do they spend 50% of [...]
PitchBook/BVR Guideline Public Company Comps Tool – free CPE webinar today
Join Linda Trugman (Trugman Valuation Associates), Rob Schlegel (Houlihan Valuation Advisors) and John Gabbert (PitchBook) in their discussion of the PB/BVR guideline public company method software, the new tool for performing GPCM analyses. The free webinar is today (Wednesday, May 19th) at 3:00pm-4:00pm ET. One CPE credit is available. Click here for more information.
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