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| Preface | |
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| Overview of Valuation | |
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| Introduction | |
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| The Nature of Major | |
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| Investment Decisions Dealing with Complexity | |
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| Process and Discipline Case Study CP3 Corporation, Inc. Summing Up and Looking | |
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| Forward | |
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| Summary | |
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| Project Analysis Using Discounted Cash Flow (DCF) | |
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| Forecasting and Valuing | |
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| Cash Flows Discounted | |
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| Cash Flows and Valuation Defining Investment | |
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| Cash Flows Comprehensive Example Forecasting Project Free | |
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| Cash Flows Valuing Investment | |
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| Cash Flows Summary Problems | |
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| Project Risk Analysis | |
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| Introduction | |
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| Uncertainty and Investment | |
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| Analysis Sensitivity | |
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| Analysis Learning More about the Project Decision | |
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| Trees Valuing Project Flexibility | |
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| Summary Problems | |
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| Appendix: An Introduction to Simulation Analysis and Crystal Ball | |
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| Cost of Capital | |
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| Estimating a Firm's Cost of Capital | |
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| Introduction Value, Cash Flows, and Discount Rates Estimating the WACC | |
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| Summary | |
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| Appendix: Extensions and Refinements of the WACC Estimate | |
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| Estimating Required Rates of Return for Projects | |
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| Introduction | |
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| The Pros and Cons of Multiple Risk-Adjusted Costs of Capital Choosing a Project Discount Rate Hurdle Rates and the Cost of Capital Summary Problems | |
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| Enterprise Valuation | |
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| Relative Valuation Using Market Comparables | |
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| Introduction | |
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| Valuation Using Comparables Enterprise | |
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| Valuation Using EBITDA Multiples Equity | |
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| Valuation Using the Price-Earnings Multiple Pricing an Initial Public Offering Other Practical Considerations | |
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| Summary Problems | |
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| Enterprise Valuation | |
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| Introduction | |
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| Using a Two-Step Approach to Estimate Enterprise Value | |
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| Using the APV Model to Estimate Enterprise Value Summary Problems | |
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| Valuation in a Private Equity Setting | |
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| Introduction | |
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| Overview of the Market for Private Equity Valuing | |
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| Investments in Start-ups and Deal Structuring Valuing | |
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| LBO Investments | |
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| Summary Problems | |
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| Earnings Dilution, Incentive Compensation, and Project Selection | |
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| Introduction | |
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| Project Analysis Earnings per Share and Project Selection Economic | |
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| Profit and the Disconnect between EPS and NPV Practical Solutions | |
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| Using Economic Profit Effectively | |
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| Summary Problems | |
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| Futures, Options, and the Valuation of Real Investments | |
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| Using Futures and Contractual Options to Value Real Investments | |
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| Introduction | |
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| The Certainty-Equivalence Method Using Forward Prices to Value | |
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| Investment Projects Using Option Prices to Value | |
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| Investment Opportunities Caveats and Limitations Tracking Errors | |
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| Summary Problems | |
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| Option Basics A Quick Review | |
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| Multi-Period Probability Trees and Lattices | |
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| Calibrating the Binomial Option Pricing Model | |
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| Managerial Flexibility and Project Valuation: Real Options | |
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| Introduction Types of Real Options Valuing | |
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| Investments That Contain Embedded Real Options | |
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| Analyzing Real Options as American-Style Options | |
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| Using Simulation to Value Switching Options | |
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| Mistakes Made in Real Option Valuation | |
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| Summary Problems | |
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| Appendix: Constructing Binomial Lattices | |
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| Strategic Options: Evaluating Strategic Opportunities | |
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| Introduction | |
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| Where Do Positive-NPV Investments Come From? | |
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| Valuing a Strategy with Staged Investments Strategic Value | |
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| When the Future Is Not Well Defined Summary Problems | |
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| Epilogue Glossary | |
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| Index | |