When valuing a company, investors look for 3 things: reliable, guaranteed, and steady revenue streams. But what if your business model involves inconsistent revenue streams? Regardless of why your company is experiencing inconsistent revenue streams, it’s important to learn what is happening and how to resolve it. Entrepreneurs (typically from a sales or operational background)
Traditions turned financial fluctuations are to be expected in the American economy. Commercialism takes over this time of year with the holiday rush. With an overload of red sales tags on toys, electronics, clothes, and more, consumers are quickly adjusting to this being a norm. Now with Thanksgiving is right around the corner, we are taking
2016 has flown by and we are already in the fourth quarter! As we wrap up the year in just over a month, strategic planning for 2017 is happening in businesses across the world. As the person responsible for the bottom line, your job as a financial leader is quite simply to improve profits and cash flow.
Shareholders’ Equity Definition The Shareholders’ Equity Definition is one of the three primary components of the balance sheet: assets, liabilities, shareholders’ (or owners’) equity. These three components comprise the well-known accounting equation of assets = liabilities + shareholders’ equity. This equation is important when beginning to think about what shareholders’ equity means for a business. The
So, you’re considering selling your business… Whether it’s to pursue new opportunities or to get out while you can, you need to start thinking about your business from a valuation standpoint. Even if you don’t intend to sell your business in the near future, building a business to be sellable is a sound strategy. So,
As I sat in my car, stuck in Houston traffic, I looked around and saw many other people stuck in a similar situation – frustrated, impatient, and banging their heads against the wheel. How easy would it be to never go into work, avoid traffic, and just stay at home or work at a local coffee shop
By publishing overly-optimistic projections, your company could be at risk for internal financial problems, misleading investors, miscalculating inventory and staff, and more. As we reach the halfway point in the year, it’s time to revisit whether your company has realistic or optimistic projections. Are your sales projections still on target? Now is a good time
See Also: Goodwill Accounting Term Fair Market Value Asset Market Value vs Asset Book Value Intangible Assets Goodwill Impairment Definition Goodwill impairment is goodwill that is now lower in value than at the time of purchase. Goodwill is an intangible asset that sellers are willing to pay for; brand, reputation, a large customer base, strong
See Also: Return On Equity Example Return on Asset Financial Leverage Gross Profit Margin Ratio Analysis Return on Equity Analysis Fixed Asset Turnover Analysis Return on Equity (ROE) The return on equity, or ROE, is defined as the amount of profit or net income a company earns per investment dollar. It reveals how much profit a company
See Also: Adjusted EBITDA Asset Market Value vs Asset Book Value Valuation Methods Goodwill Impairment Fair Market Value Definition The Fair Market Value definition is the price a specific property, asset, or business would be purchased for in a sale. A company’s fair market value should be an accurate appraisal of its worth. Calculating Fair
See Also: EBITDA Valuation Calculate EBITDA Valuation Methods EBITDA Definition Multiple of Earnings Adjusted EBITDA Definition Adjusted EBITDA is a valuable tool used to analyze businesses for the purposes of valuation and potential acquisition. Many also call it Normalized EBITDA because it systematizes cash flow and deducts irregularities and deviations. Use adjusted EBITDA as an
We are halfway through 2016 and, as technology rapidly progresses, the expectation for financial leaders to be practicing forward-thinking driven business is growing. It’s easy to fall into a habit of valuing historical data over forward-looking information. So how can you go from being historically-minded to forward thinking? First things first… Would you drive a car
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