Not all CEOs, business managers, and financial managers possess a deep understanding of value, although it is essential knowledge to creating value for companies and shareholders.

McKinsey’s Valuation: Measuring and Managing the Value of Companies, Seventh Edition, with its companion DCF Model Download, provides the knowledge executives need to make value-creating decisions–replacing some of the myths that pervade the corporate world with proven principles of value creation.

Thoroughly revised and expanded to reflect business conditions in today’s volatile global economy, Valuation + DCF Model Download, Seventh Edition provides up-to-date insights and practical advice on how to create, manage, and measure the value of an organization.

The Seventh Edition provides:

• An overview of the two core principles of valuation: the idea that return on invested capital and growth drive cash flow, and a conversation principle that anything that doesn’t increase cash flow doesn’t create value (unless it reduces risk).
• Guidance for using discounted cash flow (DCF) to value a company, with an emphasis on how to analyze historical performance, forecast free cash flows, estimate the appropriate opportunity cost of capital, identify sources of value, and interpret results.
• An explanation of how to analyze and incorporate in your valuation such complex issues as taxes, pensions, reserves, inflation, and foreign currency, complete with a case-study example.
• A framework for value creation built upon designing a portfolio of businesses, executing strategic M&A decisions and divestitures, and aligning appropriate capital structure and proper communication of business strategy with the financial markets.
• An exploration of special situations in which valuation is complex, such as the multi-dimensional challenges of valuing higher growth companies, emerging markets, cyclical companies, and banks; or in the use of option-pricing theory and decision trees in valuations.

Acclaimed for 25 years by corporate finance experts as the best guide in its class, Valuation, Seventh Edition explains, step-by-step, how to do valuation well. Business managers will learn how to decide among alternative business strategies by estimating the value of each strategic choice; how to assess major transactions such as acquisitions, divestitures, and restructurings; how to design an effective capital structure to support the corporation’s strategy and minimize the risk of financial distress; and how to create value and improve corporate performance. –This text refers to the hardcover edition.

PRAISE FOR VALUATION

“The book’s clarity and comprehensive coverage make it one of the best practitioners’ guides to valuation.”
?Financial Times

“Valuation . . . is a reminder of why shareholder value is still the most powerful idea in business and why many criticisms thrown at it are unfair.”
?The Economist

“A ‘how to’ guide for corporate executives who want to get at the unrealized shareholder values trapped in public companies.”
?The New York Times

“Cuts through the clutter and confusion to focus executives on what really drives value creation.”
?Fernando Tennenbaum, CFO, AB InBev

“Clearly articulates both the principles and practical applications of creating value.”
?John Graham, D. Richard Mead Professor of Finance, Fuqua School of Business, Duke University

“The best valuation book just got better. It is required reading for all executives.”
?Benjamin C. Esty, Roy and Elizabeth Simmons Professor of Business Administration, Harvard Business School

“The bible in its field. Anyone wanting to understand what drives corporate value should read this latest edition.”
?Dr. Raymond Breu, retired CFO, Novartis AG –This text refers to the hardcover edition.