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Comparable Valuation Method - A New Approach. Case Study: A Romanian Flexographic Printing Firm

Author

Listed:
  • 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)

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.

Suggested Citation

  • Juhász Jácint & Kovács Imola & Kovács Ildikó, 2010. "Comparable Valuation Method - A New Approach. Case Study: A Romanian Flexographic Printing Firm," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(2), pages 571-577, December.
    • Handle: RePEc:ora:journl:v:1:y:2010:i:2:p:571-577
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    References listed on IDEAS

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    More about this item

    Keywords

    mergers and acquisitions; corporate valuation; free cash flow; comparable valuation method; benchmarking;
    All these keywords.

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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