Method of and system for evaluating cash flow and elements of a business enterprise
First Claim
1. A computer-implemented method for valuing one or more elements of value of a business enterprise, comprising:
- obtaining data related to the value of the business enterprise, calculating, for each one of the elements of value, a composite variable characterizing the performance of the element of value of the business enterprise;
calculating the cash flow of the business enterprise;
determining, for each one of the elements of value, a percentage of the cash flow attributable to the element of value; and
calculating a value for each one of the elements of value of the business enterprise based on the forecast cash flow value of the business enterprise and the percentages of the cash flow attributable to the element of value.
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Abstract
An automated system and method for measuring the performance of elements of a business enterprise and for valuing said elements on a specified valuation date. The performance of the elements are calculated using composite variables. Predictive models are then used to determine the correlation between the element performance and the enterprise cash flow. The element correlation percentages are then multiplied by capitalized value of future cash flow to calculate a value for each element. Finally, the relationship between the market value of the business and the calculated business value is optionally calculated for use in forecasting future equity prices.
152 Citations
42 Claims
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1. A computer-implemented method for valuing one or more elements of value of a business enterprise, comprising:
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obtaining data related to the value of the business enterprise, calculating, for each one of the elements of value, a composite variable characterizing the performance of the element of value of the business enterprise;
calculating the cash flow of the business enterprise;
determining, for each one of the elements of value, a percentage of the cash flow attributable to the element of value; and
calculating a value for each one of the elements of value of the business enterprise based on the forecast cash flow value of the business enterprise and the percentages of the cash flow attributable to the element of value. - View Dependent Claims (2, 3, 4, 5, 6, 8, 9, 10, 11, 12, 13, 14, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42)
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7. The computer-implemented method of claim I wherein calculating the composite variable characterizing the performance of the element of value of the business enterprise comprises using transaction data and one or more transaction trends to calculate the composite variable.
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15. A computer readable medium having sequences of instructions stored therein, which when executed cause a processor to perform a method for valuing one or more elements of value of a business enterprise, comprising:
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obtaining data related to a value and cash flow of the business enterprise, calculating, for each one of the elements of value, a composite variable characterizing a performance of the element of value of the business enterprise;
calculating the cash flow of the business enterprise;
determining, for each one of the elements of value, a percentage of the cash flow attributable to the element of value; and
calculating a value for each one of the elements of value of the business enterprise based on the forecast cash flow value of the business enterprise and the percentages of the cash flow attributable to the element of value.
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29. A computer system, comprising:
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a processor having circuitry to execute instructions;
a storage device coupled to the processor and having sequences of instructions stored therein, which when executed cause the processor to, obtain data related to a value of a business enterprise, calculate, for each one of the elements of value, a composite variable characterizing a performance of the element of value of the business enterprise;
calculate the cash flow of the business enterprise;
determine, for each one of the elements of value, a percentage of the cash flow attributable to the element of value; and
calculate a value for each one of the elements of value of the business enterprise based on the forecast cash flow value of the business enterprise and the percentages of the cash flow attributable to the element of value.
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Specification