Question

How can alternative valuation methods be applied to various actual situations?

Answer 1

No single valuation method is applicable to all kind of valuation. Valuation is a subjective topic. The objective of the valuer is of utmost importance. For eg. if the objective of the investor is to acquire control over the company then the value of the share is based on earnings per share.

Also if the company is not listed then the listed peer of companies are analyzed and value the company,

The value of the company for one person can be present value of cash flow generated whereas the same property may be realisable value.

Also comparable methods can be applied for valuing the company which have relevant comparable.