Errors in 110 Common Errors in Company Valuations

4 Pages Posted: 10 Feb 2008 Last revised: 10 May 2012

See all articles by Rauf Ibragimov

Rauf Ibragimov

Russian Presidential Academy of National Economy and Public Administration

Date Written: February 8, 2007

Abstract

In the recent paper focused on the errors in actual valuations performed by financial analysts, investment banks and financial consultants Fernández and Bilan (2007) suggest corrections for nearly all identified mistakes, thus providing valuable insights for both academics and practitioners. However, instructive example of a proper valuation in the section 1.D Wrong Calculation of WACC on page 9 of Fernández and Bilan (2007) also contains errors. This note discusses the origin of these errors and the way to eliminate them.

Keywords: company valuation, valuation errors, cost of capital, leverage, WACC

JEL Classification: G12, G31, M21

Suggested Citation

Ibragimov, Rauf, Errors in 110 Common Errors in Company Valuations (February 8, 2007). Available at SSRN: https://ssrn.com/abstract=1091087 or http://dx.doi.org/10.2139/ssrn.1091087

Rauf Ibragimov (Contact Author)

Russian Presidential Academy of National Economy and Public Administration ( email )

Vernadskogo Avenue,82
Moscow, Moscow region 119571
Russia
007 495 4347103 (Phone)
007 495 4349027 (Fax)

HOME PAGE: http://www.ranepa.ru/eng/

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