Details

<p>About the Authors ix</p> <p>Preface xi</p> <p>Acknowledgments xv</p> <p><b>Part One Foundations of Value</b></p> <p>1 Why Value Value? 3</p> <p>Review Questions 16</p> <p>2 Finance in a Nutshell 17</p> <p>Review Questions 26</p> <p>3 Fundamental Principles of Value Creation 27</p> <p>Review Questions 54</p> <p>4 Risk and the Cost of Capital 55</p> <p>Review Questions 68</p> <p>5 The Alchemy of Stock Market Performance 69</p> <p>Review Questions 83</p> <p>6 Valuation of ESG and Digital Initiatives 85</p> <p>Review Questions 100</p> <p>7 The Stock Market Is Smarter Than You Think 101</p> <p>Review Questions 129</p> <p>8 Return on Invested Capital 131</p> <p>Review Questions 158</p> <p>9 Growth 159</p> <p>Review Questions 178</p> <p><b>Part Two Core Valuation Techniques</b></p> <p>10 Frameworks for Valuation 181</p> <p>Review Questions 209</p> <p>11 Reorganizing the Financial Statements 211</p> <p>Review Questions 245</p> <p>12 Analyzing Performance 247</p> <p>Review Questions 267</p> <p>13 Forecasting Performance 269</p> <p>Review Questions 295</p> <p>14 Estimating Continuing Value 299</p> <p>Review Questions 318</p> <p>15 Estimating the Cost of Capital 321</p> <p>Review Questions 350</p> <p>16 Moving from Enterprise Value to Value per Share 353</p> <p>Review Questions 374</p> <p>17 Analyzing the Results 377</p> <p>Review Questions 387</p> <p>18 Using Multiples 389</p> <p>Review Questions 412</p> <p>19 Valuation by Parts 415</p> <p>Review Questions 434</p> <p><b>Part Three Advanced Valuation Techniques</b></p> <p>20 Taxes 439</p> <p>Review Questions 453</p> <p>21 Nonoperating Items, Provisions, and Reserves 455</p> <p>Review Questions 471</p> <p>22 Leases 473</p> <p>Review Questions 486</p> <p>23 Retirement Obligations 489</p> <p>Review Questions 498</p> <p>24 Measuring Performance in Capital-Light Businesses 499</p> <p>Review Questions 514</p> <p>25 Alternative Ways to Measure Return on Capital 515</p> <p>Review Questions 524</p> <p>26 Inflation 525</p> <p>Review Questions 539</p> <p>27 Cross-Border Valuation 541</p> <p>Review Questions 559</p> <p><b>Part Four Managing for Value</b></p> <p>28 Corporate Portfolio Strategy 563</p> <p>Review Questions 583</p> <p>29 Strategic Management: Analytics 585</p> <p>Review Questions 608</p> <p>30 Strategic Management: Mindsets and Behaviors 609</p> <p>Review Questions 623</p> <p>31 Mergers and Acquisitions 625              </p> <p>Review Questions 653</p> <p>32 Divestitures 655</p> <p>Review Questions 674</p> <p>33 Capital Structure, Dividends, and Share Repurchases 675</p> <p>Review Questions 708</p> <p>34 Investor Communications 709</p> <p>Review Questions 731</p> <p><b>Part Five Special Situations</b></p> <p>35 Emerging Markets 735</p> <p>Review Questions 752</p> <p>36 High-Growth Companies 753</p> <p>Review Questions 768</p> <p>37 Cyclical Companies 769</p> <p>Review Questions 777</p> <p>38 Banks 779</p> <p>Review Questions 805</p> <p>39 Flexibility 807</p> <p>Review Questions 841</p> <p>Appendix A Discounted Economic Profit Equals Discounted Free Cash Flow 843</p> <p>Appendix B Derivation of Free Cash Flow, Weighted Average Cost of Capital, and Adjusted Present Value 849</p> <p>Appendix C Levering and Unlevering the Cost of Equity 855</p> <p>Appendix D Leverage and the Price-to-Earnings Multiple 863</p> <p>Appendix E Other Capital Structure Issues 867</p> <p>Appendix F Technical Issues in Estimating the Market Risk Premium 873</p> <p>Appendix G Global, International, and Local CAPM 877</p> <p>Appendix H A Valuation of Costco Wholesale 885</p> <p>Appendix I Two-Stage Formula for Continuing Value 909</p> <p>Index 911</p>

<p><b>TIM KOLLER</b> is a partner in McKinsey's Stamford, Connecticut office, where he leads a global team of corporate-finance expert consultants. <p><b>MARC GOEDHART</b> is a senior expert in McKinsey's Amsterdam office and an endowed professor of corporate valuation at Rotterdam School of Management, Erasmus University (RSM). <p><b>DAVID WESSELS</b> is an adjunct professor of finance at the Wharton School of the University of Pennsylvania.

<p><b>FOR THIRTY YEARS McKINSEY HAS BEEN A TRUSTED GUIDE TO TEACHING CORPORATE VALUATION</b> <p><i>Valuation, University Edition, Seventh Edition</i> contains the expert guidance from McKinsey & Company that students and professors have come to rely on. New to the fully revised and updated <i>Seventh Edition</i>: <ul> <li>New case studies that clearly illustrate both the economics of value creation and the process of measuring value</li> <li>Clarifies the distinction between creating shareholder value and maximizing short-term profits</li> <li>Explores in greater depth the factors that drive long-term value creation</li> </ul> <p>For thirty years <i>Valuation</i> has remained true to its basic principles and continues to offer a step-by-step approach to valuation, including: <ul> <li>Analyzing historical performance</li> <li>Forecasting performance</li> <li>Estimating the cost of capital with practical tips</li> <li>Interpreting the results of a valuation in light of a company's situation</li> <li>Linking a company's valuation multiples to the core drivers of its performance</li> </ul> <p>The <i>University Edition</i> contains End-of-Chapter Review Questions that help students master key concepts from each chapter. <p>Wiley also offers an Online Instructor's Manual with a full suite of learning resources for professors and students. <p><b>McKINSEY & COMPANY</b> is a global management-consulting firm that serves across a wide range of industries and functions.

US