{"id":2154,"date":"2026-10-24T21:48:32","date_gmt":"2026-10-24T19:48:32","guid":{"rendered":"https:\/\/www.michelecollini.com\/2026\/10\/24\/valutazione-azienda-dcf-multipli-patrimoniale\/"},"modified":"2026-10-24T21:48:32","modified_gmt":"2026-10-24T19:48:32","slug":"valutazione-azienda-dcf-multipli-patrimoniale","status":"publish","type":"post","link":"https:\/\/www.michelecollini.com\/en\/2026\/10\/24\/valutazione-azienda-dcf-multipli-patrimoniale\/","title":{"rendered":"Business valuation: DCF, multiples or asset-based approach?"},"content":{"rendered":"

There is no such thing as \u201cthe\u201d value of a business. There is a value estimated with a method, on stated assumptions and for a specific purpose: a sale, a new shareholder coming in, a family succession, a financing request. Change the purpose or the method and the result changes.<\/p>\n

Value and price are not the same thing<\/h2>\n

A valuation is a reasoned estimate. The price is the outcome of a negotiation and depends on factors the valuation does not contain: synergies for the buyer, the seller\u2019s urgency, the alternatives available. A sound valuation tells you how far it makes sense to go.<\/p>\n

The financial method (DCF)<\/h2>\n

The DCF discounts future cash flows at the cost of capital and adds a terminal value for the years beyond the plan. It is the most consistent method when the business has predictable cash flows and a credible plan.<\/p>\n

Its limitation is sensitivity to assumptions: small changes in the discount rate or in long-term growth move the result considerably. That is why it should always come with a sensitivity analysis.<\/p>\n

Market multiples<\/h2>\n

Multiples apply to the business the ratios observed for comparable companies or similar transactions, for example enterprise value to EBITDA. They are quick and anchored to the market.<\/p>\n

For an SME, however, finding truly comparable companies is difficult: size, liquidity and customer concentration are often very different. And the multiple must be applied to a normalised EBITDA, not the one in the financial statements.<\/p>\n

The asset-based approach<\/h2>\n

The asset-based approach starts from equity and adjusts it to current values: property, inventory, receivables, provisions. It suits asset-rich companies, such as property companies, or those with low profitability. On its own it does not capture goodwill, which is why mixed methods are often used.<\/p>\n

From enterprise value to equity value<\/h2>\n

DCF and multiples estimate the value of the business as a whole. To reach the value of the shares, net financial debt is deducted and debt-like items are taken into account, such as overdue tax and social security liabilities. This is where many disagreements in negotiations arise.<\/p>\n

Which method to choose<\/h2>\n

Usually one main method and one cross-check method are used, chosen according to the sector, the company\u2019s stage and the purpose of the valuation. The most honest result is not a single figure but a range, with the assumptions behind it.<\/p>\n

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Further reading<\/p>\n