Value Evaluation Of High-Tech Enterprises Based On EVA

With the rapid development of economy,companies that provide high-tech products R&D,manufacturing and related services are playing an increasing important role and making bigger contribution to the national economy.More and more high-tech companies are listed,while at the same time,many are seeking to expand or being merged.Company owners and investors are realizing that competitive strength and values are the key factors to survive in the competition of the industry.Therefore,it's essential to conduct an effective assessment of company values and prospects,so as to help the companies have a clear understanding of themselves and then take corresponding measures.However,special assessment system for high-tech companies hasn't established yet.Assessment system for traditional industries is not applicable for high tech companies.This thesis,based on analysis on the features of high-tech companies,proposes an excluded assessment model and method for evaluate the values of high-tech companies.In the second chapter,the author gives a definition of “high-tech company”,makes analysis on the features of and the difficulties to conduct assessment for high tech companies.Then the author gives a brief introduction to the traditional assessment system and its theory basis,and conducts analysis on its application on high tech companies.The author points out that high tech companies feature rapid growth,high profit but also high risk.Given these features,Economic Value-Added model,combined with theory of company values evaluation,is an applicable assessment method.EVA assessment model is able to comprehensively and objectively examine and evaluate a company's revenue and performance,capital cost,and its capability to create values.The author,through cases study of high tech companies,makes comparison of different evaluation results by EVA model and other assessment methods including Discount Cash Flow model,P/E ratios and Real Option approach.The comparison shows that capital cost,features and capability of creating values of high-tech companies are taken into fully consideration.The author concludes that EVA model is the best assessment method for evaluating a high-tech company's values.It will also give clear analysis on the factors that bring these values.It benefits for the long-term development of the company.