Principles of Cash Flow Valuation
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Principles of Cash Flow Valuation : An Integrated Market-Based Approach

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Description

Principles of Cash Flow Valuation is the only book available that focuses exclusively on cash flow valuation. This text provides a comprehensive and practical, market-based framework for the valuation of finite cash flows derived from a set of integrated financial statements, namely, the income statement, balance sheet, and cash budget. The authors have distilled the essence of years of gathering academic wisdom in the study of cash flow analysis and the cost of capital. Their work should go a long way toward bridging the gap between the application of cost benefit analysis and the theory of capital budgeting.

This book covers the basic concepts in market-based cash flow valuation. Topics include the tme value of money (TVM) and an introduction to cost of capital; basic review of financial statements and accounting concepts; construction of integrated pro-forma financial statements; derivation of free cash flows; use of the WACC in theory and in practice; estimating the WACC for non traded firms; calculating the terminal value beyond the planning period. It also revisits the theory for cost of capital and explains how cash flows are valued in reality. The ideas are illustrated using examples and a case study. The presentation is appropriate for a range of technical backgrounds.

This text will be of interest to finance professionals as well as MBA and other graduate students in finance.
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Product details

  • Hardback | 350 pages
  • 154 x 228 x 34mm | 938.93g
  • Academic Press Inc
  • San Diego, United States
  • English
  • 0126860408
  • 9780126860405

About Joseph Tham

By Joseph Tham and Dr. Ignacio Velez-Pareja
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Table of contents

Basic concepts in market-based cash flow valuation; Time value of money (TVM) and introduction to cost of capital; Basic review of financial statements and accounting concepts; Constructing integrated pro-forma financial statements; Derivation of the free cash flows; Using the WACC in theory and in practice; Estimating the WACC for non traded firms; Beyond the planning period: calculating the terminal value; Theory for cost of capital revisited;How are Cash Flows Valued in Reality?
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Review quote

"...Tham and Velez-Pareja in particular stress the importance of financial statements and their use in valuation. Many detailed examples make it easy not only to understand but also to apply valuation theory." - Professor Dr. Dr. Andreas Loeffler,
Lehrstuhl fur Banken und Finanzierung, Universitat Hannover

One of the Top Ten financial engineering titles published in 2003-2004 - Richard Norgate, Ph.D., Financial Engineering News
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