| Registro completo |
| Provedor de dados: |
AgEcon
|
| País: |
United States
|
| Título: |
On the Valuation of Companies with Growth Opportunities
|
| Autores: |
Dapena, Jose Pablo
|
| Data: |
2008-10-09
|
| Ano: |
2003
|
| Palavras-chave: |
Real options
Valuation
Contingent claims valuation
Financial Economics
G12
|
| Resumo: |
Each company faces day to day investment opportunities. Just by staying in business the company is taking a decision of reinvesting capital. These opportunities have to be fairly valued to overcome misallocation of resources. A project with high growth opportunities requires high reinvestments to take full advantage of them until it reaches its mature stage. These investments can be seen as a succession of call options on future growth. When a company with such prospects is valued using the discounted cash flow technique and growth is taken implicitly in the growing cash flows and the residual value, the value thus obtained will be higher than the true one (under certain circumstances). Technology advances and the effects of globalization create enormous growth opportunities, and so misvaluation risks are higher.
|
| Tipo: |
Journal Article
|
| Idioma: |
Inglês
|
| Identificador: |
Print ISSN 1514-0326
Online ISSN 1667-6726
http://purl.umn.edu/44040
|
| Relação: |
Journal of Applied Economics>Volume 6, Number 1, May 2003
|
| Formato: |
24
|
|
