Exit Strategies Insights

Industry insights, knowledge base and announcements for business owners and professional advisors

Business Valuation Insights

Twenty Reasons to Know the Value of Your Company

Company owners and shareholders seek independent business valuations at various times for various reasons. Here are twenty situations in which you may want a business valuation: An owner has passed away and a valuation is required to settle the estate per IRS regulations. An owner is getting divorced and needs to have the company or their fractional interest valued to settle the marital estate. An owner wants to gift shares to his or her heirs. Business acquisition financing. Owners …

Read more »

Rising Interest Rates and Investment

Since July, the benchmark interest rate, the US 10-year treasury bond, has risen from 1.35% to over 2.55%. That’s a very big move in a short-period. Post-election day the rising rate trend accelerated. We saw a similar spike in 2013, only to see rates retreat. Is it different this time? Valuation Building Block Markets seem to believe that current rates are sustainable and can keep rising given the lower tax and infrastructure spending pronouncements coming …

Read more »

Why is That Information Needed?!?

When we begin a business valuation project the first thing we do is provide an extensive document request list. A week or two into the analysis, we send a customized questionnaire to help us understand the business in appropriate depth. Our questions are designed to understand the facts and circumstances of your business well enough to develop a reliable opinion of value. To the extent we can, we try to streamline and tailor our requests so as not to …

Read more »

Fair Market Value — is it really fair?

In the business valuation profession, one determines Fair Market Value through analysis of the company and its management structure, the industry in which it participates, economic conditions and trends present in the industry, competitive environment, and any other factors that help to define the risk of investing in the enterprise. This analysis of risk is what many in the appraisal profession term as the subjective part of the valuation analysis, or “the art” of appraisal analysis. …

Read more »

Update on Estate and Gift Tax Changes Coming in 2016

Proposed rule changes would limit the practice of discounting the value of stakes in family businesses for estate and gift tax purposes—an update regarding IRS timeline. The U.S. Treasury Department and the IRS are planning to introduce new regulations aimed at estate and gift transfers of closely held family businesses. The new rules would limit the practice of discounting minority stakes in closely held family owned businesses because of restrictions on an owner’s ability to …

Read more »

Buried in the Corporate Archives – a Valuation Case Study

A lot of our valuation work is done for the purpose of internal share transfers of private businesses, or buy-sell transactions. In doing this work, we often see that owners have overlooked or neglected to keep important documents up to date. One such document is the buy-sell agreement, which articulates important legal, tax, valuation and financing issues that are important to ensuring smooth share transfers and business continuity. We recently evaluated a holding company with a fair …

Read more »

Estate and Gift Tax Changes Coming in 2016?

New rules would limit the practice of discounting value of minority stakes in family businesses. The Wall Street Journal, Wednesday August 3, 2016, page A3 reported that the U.S. Treasury Department and the IRS are planning to introduce new regulations aimed at estate and gift transfers of closely held family businesses. The new rules would limit the practice of discounting minority stakes in closely held family owned businesses because of restrictions on an owner’s ability …

Read more »

Dental Practice Valuation Insights

It seems that every time I value a dental practice the industry has undergone or is going through significant changes. Patients and the medical community are rapidly recognizing dentists as oral health specialists which is expanding the services being offered by the dental industry. The dental professional is looking beyond the mouth. Connections between oral health and whole body health are allowing for more collaboration around sleep problems, oral cancer, facial esthetics, and periodontal health. …

Read more »

Risk and its Effect on Enterprise Value

Investors have choices in how to allocate their investment dollars across the risk and return spectrum. Whether it be bonds, public company equity, or private company equity, an astute investor will evaluate the risk of return and expect to be compensated according to this risk. Business valuation, whether for public or private companies, has three key variables: growth, profit margins, and risk. Growth and profit margins are more easily understood by most business owners and …

Read more »

Business Valuation and M&A Services for Estates and Trusts

This article takes a look at the various situations in which trusts and estates (those that hold private business interests) need business valuation or M&A brokerage services. Business Valuation Services Our firm, Exit Strategies Group, regularly provides fair market value appraisals (a.k.a. valuations) of closely-held corporations, FLPs and LLCs for estate planning, gifting, estate tax, charitable donations, buy-sell transactions and succession planning. We value fractional interests in operating companies and asset holding companies using appropriate …

Read more »

Request a Call
close slider
Request a Call and we will get in touch with you
  • This field is for validation purposes and should be left unchanged.