The Application Of Discounted Cash Flow Valuation In Corporation Acquisition

Valuation is based on the analysis of the company's history financial condition and short-term financial projections, using of a variety of assessment methods to assess the value of company stock,analyzing the company's growth potential and future development trends,finding the key factors of impacting the value of the company and explaining its role,to completing assessment report of the company valuation.M & A is the optimal allocation of resources in capital markets function in an important embodiment of a listed company is to promote an important way to be strong.M & A program involving multi-stakeholder coordination of the core is the most M & A to determine pricing.The pricing of M & A is often the target company's overall valuation.At present,varieties of M & A valuation methods are used in capital market,and discounted cash flow is the most widely-use method.Discounted cash flow method is considering the company's development trend,returning of investment,future growth and more accurately reveal the intrinsic value of stocks,but there are also more difficult to determine the parameters and so on.In this paper,selecting BEIJING HUAER CO.LTD mergers and acquisitions case,although the discounted cash flow from the point of view of the overall price of the GUOYUAN SECURITIES higher,there are some incorrect dates and unreasonable pricing depend on the valuation report,but whether it is from market point of view,from the perspective of the future development of listed company,or from the investor point of view,this is the more successful mergers and acquisitions,which reached a listed company with the shareholders a win-win situation.At the same time,I still think that at this stage dividend discount method to assess the overall assets of a more appropriate way. The biggest advantages of this method is considered income from continuing operations of assets,and cash flow from the perspective of the book rather than the perspective of profit calculated to give investors the benefits to consider the value of the assets,particularly applies to the securities companies to do adequate cash flow,stability assessment of enterprise value.In China's current capital market conditions,the price of M & A transactions in accordance with the reliability of pricing, it is worth exploring.Investment projects during the evaluation process,especially the use of net cash flow valuation model for the process of enterprises,in addition to the attention of their own after the discounted cash flow value, should also consider the size of enterprise and corporate market changes brought about after impact.To think about the whole enterprise use,but not limited to an evaluation of a project.In addition,the country element of the overall value of the securities is based on the determination of discounted cash flow model to evaluate.The mainstream methods were involved in a number of parameters is based on the basis of future projections.Therefore,any assessment of the methods and models,only a technical means,the result of the transaction as a pricing reference only.Reasonable pricing for the program, and the need to regulate the sector on the one hand,strict price basis,to strengthen the regulatory agency can also be made by listed companies by requiring the commitment of future performance,which is lower than the performance of promises to investors of the need to limit the valuation of compensation mechanisms such as the amplification.