Business Valuations
One of the most critical aspects of your business is knowing its value.
Without knowing the true value of your business you will not know:
- How profitable the business is
- If buy-sell and other agreements are properly funded
- A fair market price
A proper business valuation can do all of this. By a review of the past several years tax documents and other basic business information we can create a detailed 29 page Business Valuation.
This information is necessary if and when you:
- Apply for Life Insurance, whether its for the business or personal
- Determining the proper coverage for Property and Casualty Insurance
- Apply for a loan/line of credit/pandemic relief
- Expand your operations
- Pass the business on to the next generation
- Sell your business
How we value your business:
- Comprehensive analysis of Business supporting multiple business & personal planning issues
- 4 Values – Asset value, Equity value, Enterprise value, Liquidation value
- Formula Methods
- Objective Factors with allowances for special circumstances
- Capitalization of Earnings (10X average earnings over last 5 years)
- Certified appraisal by Independent Service, Combination of Methods
- IRS accepted Valuation Factors - History & nature of Business, Degree of Business risk involved, State of national economy & specific industry, Business financials (Balance sheet, Tax returns)
- Balance sheet determines liquidity, working capital, long term indebtedness, net worth & book value
- Book Value / Assets minus Liabilities divided by number of outstanding shares
- Earning capacity of Business / P&L for prior 3 years, Net profit after tax, Payments of dividends on Preferred Stock
- Dividend paying capacity / Closely held corporations avoid double taxation of dividends by paying salaries, bonuses & benefits
- Goodwill / IRS formula Excess of net earnings@ verified return on net tangible assets
- Previous sales of stock
- Fair market value of Publicly traded stock of comparable businesses