Question

What are the primary differences among the CF valuation model, asset-based valuation model, and multiples valuation model?

Answer 1

Solution:

If we are talking about the primary difference between these three modals we discuss about the defination of these there that are :

1).

CF VALUATION MODEL :

The model is simply a forecast of a company's unlevered free cash flow analysis is an intrinsic value. ... There are many types of CF into the future and discounts it back to today at the firm's Weighted Average Cost of Captial (WACC). Here we define it

2).

ASSET - BASED VALUTION MODEL :

An asset-based approach identifies a company's net assets by subtracting liabilities from assets. The asset-based valuation is often adjusted to calculate the net asset value of a company based on the market value of its assets and liabilities. This here asset-based defined.

3).

MULTIPLE VALUATION MODEL :

The multiples approach is a valuation theory based on the idea that similar assets sell at similar prices. It assumes that a ratio comparing value to a firm-specific variable, such as operating margins, or cash flow is the same across similar firms. Thus multiple valuation is defined.