COMPARABLE VALUATION METHOD - A NEW APPROACH. CASE STUDY: A ROMANIAN FLEXOGRAPHIC PRINTING FIRM

Juhász Jácint (), Kovács Imola () and Kovács Ildikó ()
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Juhász Jácint: Universitatea Babes-Bolyai, Economice si Gestiunea Afacrilor
Kovács Imola: Universitatea Babes-Bolyai, Economice si Gestiunea Afacrilor
Kovács Ildikó: Universitatea Babes-Bolyai, Economice si Gestiunea Afacrilor

Annals of Faculty of Economics, 2010, vol. 1, issue 2, 571-577

Abstract: This study presents the valuation scheme of a flexographic printing industry firm. The industry, the technology used and most importantly the firm being young ones, it is not possible to use the classical comparable valuation methods. The new approach in this matter is to use as benchmark financial ratios not those related to the price of the firm (as P/E, P/S, P/BV, P/CF, P/CAPEX), but those related to the structure of the income statement, financial and operating leverage using 13 Romanian and 6 Hungarian reference firms' data. Our main contribution to this line of research is to solve the problem of lack of reference data regarding the price, the benchmark companies not being listed on any stock exchange.

Keywords: mergers and acquisitions; corporate valuation; free cash flow; comparable valuation method; benchmarking (search for similar items in EconPapers)
JEL-codes: G31 G32 G34 (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:ora:journl:v:1:y:2010:i:2:p:571-577

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