Valuation: Measuring and Managing the Value of Companies

by McKinsey & Company, Inc., Tim Koller, Marc Goedhart, et al.

Book Overview

"This book on valuation represents fresh new thinking. The writing is clear and direct, combining the best academic principles with actual experience to arrive at value increasing solutions." J. Fred Weston, Cordner Professor of Money and Financial Markets, Graduate School of Management, UCLA. "The book's clarity and comprehensive coverage make it one of the best practitioners' guides to valuation." -- Financial Times In the global economy of the...

• Format: Hardcover
• Language: English
• ISBN: 0471009938
• ISBN13: 9780471009931
• Release Date: September 1994
• Publisher: Wiley
• Length: 576 Pages
• Weight: 2.15 lbs.
• Dimensions: 1.7" x 6.3" x 9.3"

Customer Reviews

What do you expect from McKinsey?

My only complaint is that I did not buy this book earlier. I really found the content excellent and laid out in a helpful style, with plenty of illustrations so I could test my understanding of the words. Some of the more complex formulae (especially towards the end) lost me, but that was not a fault of the authors ~ more the reader. For any but the most experienced, this seems to be the best book on Valuation I have read, let alone bought and I have been in this market for over 30 years. Many of the concepts are well known, especially in the first part of the book ~ Fundamental principles ~ but even there, the wealth of detail and illustrations kept the text fresh and interesting. The second part was a excellent drive through the practical aspects of valuing a business and was followed, in the third group of chapters, by a review of Value Creation Principles. This is all good stuff and culminated in the last section with a number of more complex but practical examples and case studies. The only chapter I thought did not advance my knowledge & add value, was that on "Investor Communications"; not up to the standard of the rest of the book, was it written by an associate? Congratulations to Mr. Koller and his co-authors, they certainly offer value for money with this edition ~ its more than just a book on Valuation. Buying the Valuation Model case study CD adds value, but I found the links not atall easy, but a phone call solved the problem.

Valuation (McKinsey - 4th Edition)

This book is awesome. It offers incredibly comprehensive and insightful methods for rearranging financial statements into key drivers of firm value. It also teaches you how to apply those drivers to create a forecast for the future. Individual chapters are dedicated to the more complex concepts. This is a great resource for an aspiring or practicing analyst.

Valuation bible!

Have used the book for years and this may be the best update yet. The case studies alone are simply fascinating. The global nature make it invaluable for everyone in business anywhere. New discussions on return on capital and growth are must-read.

This IS the bible of valuation

The ultimate, common sense, technical "how to" manual on valuation. This book embodies the entire McKinsey institutional knowledge on valuation (I know - I used to work there).However, a significant note of caution! In the immortal words of Chuang Tzu " Nobody ever became a great horseman by talking about horses". If it were as simple as following the recipe book, would McKinsey have published their state secrets? Good valuation work requires very considerable experience and judgement. Tinker with a few assumptions (especially continuing value assumptions) and you can double or halve your valuation.The greatest potential danger with this book is that you will lull your self into a false sense of security through rigorous adherence to the minutiae of the process. EXPERIENCE MATTERS A LOT IN THE APPLIATION OF THIS PROCESS.That said, in the hands of a knowledgable and thoughtful user, you will not find a better guide to valuation. If only half of the CEO's out there would read it!

An excellent overview of the subject

This book has been hailed as a classic by many professionals, and it is easy to see why: It is well-organized, and it provides excellent examples and case studies. Another reader commented that those who want an introduction to this topic is "wasting their time and money." I believe otherwise. If you have a strong interest in the subject, this book will prove very usable. I was surprised that this book was not very math-intensive since the authors assume that the reader already has a rudimentary understanding of finance and accounting. Robert Higgins' "Analysis for Finance Management" is an excellent companion to "Valuation."