How to Determine the True Value Based on Your Planning

The question of a company’s value brings to mind a sale or succession, appraisers, and lengthy processes. It’s easy to assume that this is a topic for later or for specialists—not for day-to-day business. But your company’s value plays a role in every meeting with a bank, every investment decision, and every strategic move—not just when it comes time to sell.

In practice, it’s surprisingly easy to come up with a rough but reliable estimate based on numbers you already have. You don’t need an expensive appraisal to do this. If you know your own plans, you also have a rough idea of the value.

In this free live webinar, we’ll use a specific real-world example to show you how to roughly determine a company’s value using two simple methods, what distinguishes these methods, and what factors determine whether a company is considered valuable.

What the webinar is about

The focus is on a hypothetical company from any industry. We determine its value in two ways and compare the results, as they shed light on different aspects of the same company.

The first method is the income approach using a multiple: In simple terms, the value is calculated by multiplying the net income by a factor typical for the industry. The second is the net asset value, which shows the company’s net assets after deducting liabilities. Using this example, we’ll illustrate why both methods can yield different values and what that says about a company.

The logic here is clear: What is my company worth because it generates earnings? What is it worth because of its underlying assets? And where does the factor that determines whether the multiple is in the millions actually come from? In addition, we’ll provide an outlook on how artificial intelligence can help identify value drivers more quickly and prepare valuations in the future.

This module is intentionally structured somewhat differently from the others: it has a stronger workshop focus, allows more room for concepts and thought-provoking questions, and includes a live demonstration that supports the learning process but does not take center stage.

Typical questions from practice

Many business owners have no rough idea of the value of their own business. In this webinar, we’ll therefore address questions that are often critical in real-world situations:

• What is the approximate value of my business, and how can I quickly come up with an initial estimate?
• What is the difference between the income value and the net asset value?
• Where does the factor in the multiple come from, and what drives it up or down?
• Why can a company with substantial assets still be worth very little, and vice versa?
• How does an improvement in earnings affect a company’s value?
• How can artificial intelligence help identify value drivers in the future?

Your advantages in everyday working life

After the webinar, you’ll be able to roughly estimate a company’s value on your own and understand the factors that influence it. You’ll recognize why a stable, highly profitable company is valued higher than one with fluctuating performance, and what that means for your own management. You’ll receive a clear, step-by-step breakdown that you can apply to your own company, and see how the necessary baseline figures can be derived from integrated planning.

The practical benefits are particularly evident in meetings with banks, investors, or regarding succession planning: Instead of going into such meetings unprepared, you’ll arrive with a well-founded initial understanding of your own value.

Who is the webinar suitable for?

This webinar is aimed at managing directors, CFOs, and controllers at medium-sized companies who want to gain an initial, well-founded understanding of their company’s value. It is particularly relevant for companies that are preparing for discussions with banks, investors, or successors, or that want to align their management practices more closely with enterprise value.

Previous knowledge from the previous modules is not required.

Your benefits at a glance

You will learn,

• How to Quickly Determine an Initial Price Range Using a Multiple
• What distinguishes the income value from the net asset value
• where this factor comes from and which value drivers influence it
• how an improvement in earnings specifically affects a company’s value
• how to extract the necessary figures from your own integrated planning
• what role artificial intelligence might play in evaluation in the future

Part of our webinar series on integrated corporate planning

This webinar is Module 6 in a modular series. The modules build on one another in terms of content, but each can be understood on its own.

Why TD Trusted Decisions?

TD Trusted Decisions supports medium-sized companies in making their planning, reporting and corporate management clearer, more integrated and more decision-oriented.

Our experience shows that stable earnings, sound planning, and reliable figures not only make a company easier to manage but also increase its value. A company’s value is therefore not a matter of chance, but the result of sound management. Only those who understand their numbers can assess their value and increase it in a targeted manner.

In this webinar, we combine our professional consulting experience with a practical approach. This demonstrates how integrated planning leads to a well-founded initial assessment of a company’s value.