Unveiling the Dark Side of Valuation: How Tech Companies Are Truly Valued
The article discusses how to value technology companies, focusing on old and new tech firms. It explains the fundamentals of discounted cash flow valuation, estimating discount rates, cash flows, and growth. The researchers emphasize the importance of accurately estimating firm value using various approaches like the multiple approach and stable growth model. Key findings include the need to consider growth assets, historical growth, and the survival issue when valuing technology firms.