APV


4.4 ( 1314 ratings )
Финансы Образование
Разработчик Business Compass LLC
1.99 USD

Adjusted Present Value (APV) is a way to value companies as all equity financed and by adding financial side effects; such as, present value of tax shield (PVTS) and (subtracting) present value of financial distress (PVFD).

Free Cash Flow (FCF)
Cash Flow time can be supplied (optional)
FCF can repeat

Series of FCFs are added

Cost of Equity (Ra) is used for discounting FCFs

PVTS is added and PVFD is subtracted to determine the value of the firm.

APV can be applied to any financial scenario; especially, ones involving government subsidy and rebate. These are not accommodated by WACC valuation.