Insights

During the credit crisis of 2007 to 2009, we had observed that equity valuations based on market multiples in our home market (the Netherlands) consistently differed from valuations based on discount rates and forecasts (also known as discounted cash flow or DCF). This was caused by discount rates that were too low. One of the discount rate components, equity risk premium (ERP), was not properly capturing market risk. This problem persists today in some countries and regions.

Inaccurate ERP’s can lead to mispriced investments and unsupportable valuation opinions. To solve this problem, we began investigating ERP’s in 2012 and have continued to develop and refine our methods through present day. Our ERP findings are available in our equity risk premium research report series, currently available for the United States and the Benelux (Belgium, Netherlands and Luxembourg) region, via the Research Reports section of our website and on select research platforms.

AN Valuations is proud to announce that our equity risk premium research reports are now available on Refinitiv (a subsidiary of London Stock Exchange Group and formerly a subsidiary of Thomson Reuters). Entitlement requests for real-time access can be sent to entitlements@anvaluations.com. Refinitiv customers can also purchase our research reports directly on an embargoed basis.

About AN Valuations
Clients around the world trust AN Valuations for valuation advisory services. We help stakeholders in a broad range of industries with company valuations ranging from micro-cap to large-cap.

AN Valuations assists companies with valuations of businesses, financial instruments, derivatives, personal property and intellectual property (such as brand assets and patents) for transaction, fiscal, legal and accounting purposes, particularly in cross-border situations. We also offer a series of capital markets research reports that are available on our online website and on some of the world’s most important financial platforms. Through our bespoke approach and global network, we customize teams to the needs of our clients.

For more information regarding purchase price allocations or other services provided by AN Valuations, do not hesitate to contact Andrew Pike at info@anvaluations.com or at +31 70 221 0058.