Focus On Value
a book on firm valuation by James Grant. The goal of valuation (for management decisions or for external investors) is:
- assess whether the company generates a good return on existing assets
- examine risk to value relation in a Cost of Capital framework
- invest positively for economic profit growth
- understand the magnitude of external influence
- reconcile market with fundamental expectations of economic profit growth
Few frameworks are used internally:
- Economic Value Added
- Risk Adjusted ROCE
- Shareholder Value Added