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| EBITDA Single Period Income Capitalization for Business Valuation (1610AN) |
Course CPE: 2 hours
Field(s) of Study: Accounting–2
Program Level: Intermediate
Prerequisites: Previous training or research on subject matter being taught. Such persons are often at a mid-level within the organization, with operational and/or supervisory responsibilities.
Advanced Preparation: None
Delivery Method: Self-Study
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Item
Number: 16PBVSD10A
Shipping Weight: 0lbs. 0oz. |
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$147.00 |
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Recording Date: June 10, 2016
Presenter: Chris Mercer
Program Description:
The focus on the EBITDA of private companies is almost ubiquitous among business appraisers. This session addresses the relationship between depreciation (and amortization) and EBIT as one measure of relative capital intensity. This relationship, "the EBITDA Depreciation Factor," is then used to convert debt-free pre-tax (i.e., EBIT) multiples into corresponding multiples of EBITDA.
Mercer presents analysis that illustrates why the pervasive rules of thumb suggest that many private companies are worth 4.0x to 6.0x EBITDA, plus or minus, have such stickiness. This session then suggests a methodology based on the Adjusted Capital Asset Pricing Model, whereby business appraisers can independently develop EBITDA enterprise value multiples under the Income Approach and includes private and public company market evidence.
After completing this webinar, attendees will be able to:
- Recognize the relationship between EBIT and depreciation (and amortization) and why companies have relatively high or low EBITDA multiples
- Identify research about the "EBITDA Depreciation Factor" for public and private companies and learn how capital intensity impacts EBITDA multiples
- Identify "Build" multiples of EBITDA for specific assumptions in unique valuation situations using the Adjusted Capital Asset Pricing Model. They will also then be able to employ those multiples to develop indications of enterprise value under the Income Approach to valuation
For more information regarding refund or concerns, please contact our offices at (800) 677-2009.
The Consultants’ Training Institute (CTI) is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org. |
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