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Categorically complete.
Valuations, like companies, come in many
different packages. Public and private companies and investment
entities each need specialized valuation services to make prudent
business decisions and comply with particular requirements set by
agencies such as the IRS, SEC and DOL.
It’s our job to deliver valuation reports that meet these
rigorous requirements, adapt for varying client needs and, most
importantly, remain independent. We take a comprehensive approach,
triangulating value through the three valuation approaches -- income,
market and cost -- and considering multiple methodologies
for each. Combining our team’s extensive valuation training,
education and business acumen, we help our clients make better-informed
business decisions and mitigate risk.
In conducting our analysis, we typically study various combinations
of the following:
- History of the business
- Outlook of the economy and industry
- Market position of the company
- The financial condition and earning capacity
of the business relative to industry competitors
- Competitive threats and opportunities in
the marketplace
- Management’s outlook and projected
operating performance
- Comparable publicly traded companies
- Recent transactions involving similar companies
Establishing Value : Making value judgments.
Quist looks at every angle when valuing business interests. We must take into account numerous variables that differ case by case. For example, investors are most interested in a company’s future cash flow and the risk associated with realizing that cash flow. Therefore, we consider a company’s historical financial performance very important.
We certainly look at history, but we also must factor in evolving market conditions and variables such as loss of key personnel, entry of a well-funded competitor or introduction of technological changes. The approach we use to establish value is best visualized as a three-tiered “continuum of value.”
- Control Value: Highest value is based on majority or total control. For example, when the interest holder has the ability to influence cash flows, we look at the price the interest would command in a single transaction with one buyer.
- Freely Tradable Minority Interest Value: Theoretical trading price of minority interests if a market already exists. For example, the interests are registered and traded in an active market.
- Non-marketable Minority Interest Value: Takes into account a discount on the minority trading price where a market does not already exist. For example, with no established market, sellers could not convert their interest to cash quickly like publicly traded stock.
Of course, on all levels of value, we factor in obligatory variables, including control premiums, minority discounts, marketability discounts, cash flows and ownership rights. But here’s the key: The process cannot move forward until one of the above levels of value is clearly defined, and the rights and powers of the interest holders are closely examined. Once that’s established, Quist can deliver the most accurate and objective valuation without compromises or contingencies. The end work product? An unbiased report that will stand up to intense examination.
Confidentiality: Under lock. With key.
Valuation services require the utmost attention to confidentiality. We take that very seriously. It’s our policy to maintain strict confidentiality standards, never divulging anything about our clients unless we’re officially directed otherwise. To further guarantee our commitment to complete confidentiality, we regularly sign non-disclosure agreements both during and after engagements and agree to be retained by our clients’ attorneys to assure the client-attorney privilege is legally enforceable.
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