A proposal to estimate the valuation of small and medium size companies using geographically comparable information

  1. Mariluz Mate 1
  2. Paolo Occhino 1
  1. 1 Universidad Politécnica de Cartagena (Spain)
Small Business International Review

ISSN: 2531-0046

Datum der Publikation: 2020

Ausgabe: 4

Nummer: 1

Seiten: 34-51

Art: Artikel

DOI: 10.26784/SBIR.V4I1.229 DIALNET GOOGLE SCHOLAR lock_openOpen Access editor

Andere Publikationen in: Small Business International Review


Un requisito previo en cualquier análisis de valoración es la disponibilidad de información temporal para determinada variables financieras. Las pequeñas y medianas empresas, aunque representan más del 98% en los sistemas productivos actuales, no disponen de información temporal para estimar las valoraciones. En este documento, ofrecemos un procedimiento para estimar los valores de las empresas de tamaño reducido bajo la hipótesis de que el comportamiento espacial afecta a las valoraciones. Con este objetivo, presentamos los antecedentes teóricos para esta hipótesis e introducimos una propuesta espacial con un estudio de caso de empresas industriales, donde el papel significativo del espacio en las valoraciones de las empresas se ha probado previamente. Este análisis muestra la relevancia de la información espacial en la valoración de las empresas confirmando la capacidad predictiva de nuestro enfoque aplicando la metodología fuera de muestra

Bibliographische Referenzen

  • Aleknevičienė, V., Stončiuvienė, N., & Zinkevičienė, D. (2013). Determination of the fair value of a multifunctional family farm: a case study. Studies in Agricultural Economics, 115(3), 124–133. https:// doi.org/10.7896/j.1319
  • Anselin, L., & Rey, S. (2010). Properties of Tests for Spatial Dependence in Linear Regression Models. Geographical Analysis, 23(2), 112–131. https://doi.org/10.1111/j.1538-4632.1991.tb00228.x
  • Arcuri, G., & Levratto, N. (2018). Early stage SME bankruptcy: does the local banking market matter? Small Business Economics. https://doi.org/10.1007/s11187-018-0042-4
  • Benninga, S. Z., & Sarigo, H. (1997). Corporate finance: a valuation approach. New York, USA: McGraw-Hill.
  • Berger, A. N., & Udell, G. F. (1998). The Economics of Small Business Finance: The Roles of Private Equity and Debt Markets in the Financial Growth Cycle. SSRN Electronic Journal. https://doi.org/10.2139/ ssrn.137991
  • Bikhchandani, S., Hirshleifer, D., & Welch, I. (1992). A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades. Journal of Political Economy, 100(5), 992–1026. https://doi. org/10.1086/261849
  • Bruner, R., Eades, K., Harris, R., & Higgins, R. (1998). Best practices in estimating the cost of capital: survey and synthesis. Financial Practice and Education, 8, 13–28.
  • Cañadas, J. A., & Rojo Ramirez, A. A. (2011). The Discount Rate in Valuing Privately Held Companies. Business Valuation Review, 30(2), 70–81. https://doi.org/10.5791/0882-2875-30.2.70
  • Cea, J. L. (1979). Modelos de comportamiento de la gran empresa capitalista. Madrid, Spain: Instituto de Planificación Contable.
  • Chen, H. (2010). Macroeconomic Conditions and the Puzzles of Credit Spreads and Capital Structure. The Journal of Finance, 65(6), 2171–2212. https://doi.org/10.1111/j.1540-6261.2010.01613.x
  • Chevalier, J., & Scharfstein, D. (1994). Capital Market Imperfections and Countercyclical Markups: Theory and Evidence. Cambridge, MA. https://doi.org/10.3386/w4614
  • Damodaran, A. (2007). Valuation approaches and metrics: a survey of the theory and evidence. Foundations and Trends in Finance, 1(8), 693–784.
  • Damodaran, A. (2010). The dark side of valuation: valuing young, distressed, and complex businesses. Choice Reviews Online, 47(09). https://doi.org/10.5860/CHOICE.47-5115
  • Damodaran, A. (2012). Tools and Techniques for Determining the Value of Any Asset. Hoboken, N.J: Wiley. Retrieved from https://www.wiley.com/en-us/%3A+Tools+and+Techniques+for+Determining+the+V alue+of+Any+Asset%2C+3rd+Edition-p-9781118011522
  • Dietsch, M., & Petey, J. (2004). Should SME exposures be treated as retail or corporate exposures? A comparative analysis of default probabilities and asset correlations in French and German SMEs. Journal of Banking & Finance, 28(4), 773–788. https://doi.org/10.1016/S0378-4266(03)00199-7
  • Dönbak, E. R., & Ukav, Ä°. (2016). Continuing Value Calculation with Discounted Cash Flows Method: An Application Example for Tekart Tourism Establishment Whose Shares Are Dealt in Istanbul Stock Exchange. J. of Tourism and Hospitality Management, 4(3), 139–145. https://doi.org/10.17265/2328- 2169/2016.06.005
  • Dusatkova, M. S., & Zinecker, M. (2016). Valuing start-ups – selected approaches and their modification based on external factors. Business: Theory and Practice, 17(4), 335–344. https://doi.org/10.3846/ btp.17.11129
  • Eberhart, A. C. (2001). Comparable firms and the precision of equity valuations. Journal of Banking & Finance, 25(7), 1367–1400. https://doi.org/10.1016/S0378-4266(01)00171-6
  • Elhorst, J. P. (2010). Applied Spatial Econometrics: Raising the Bar. Spatial Economic Analysis, 5(1), 9–28. https://doi.org/10.1080/17421770903541772
  • https://doi.org/10.7896/j.1319
  • https://doi.org/10.7896/j.1319
  • https://doi.org/10.1111/j.1538-4632.1991.tb00228.x
  • https://doi.org/10.1007/s11187-018-0042-4
  • https://doi.org/10.2139/ssrn.137991
  • https://doi.org/10.2139/ssrn.137991
  • https://doi.org/10.1086/261849
  • https://doi.org/10.1086/261849
  • https://doi.org/10.5791/0882-2875-30.2.70
  • https://doi.org/10.1111/j.1540-6261.2010.01613.x
  • https://doi.org/10.3386/w4614
  • https://doi.org/10.5860/CHOICE.47-5115
  • https://www.wiley.com/en-us/%3A+Tools+and+Techniques+for+Determining+the+Value+of+Any+Asset%2C+3rd+E
  • https://www.wiley.com/en-us/%3A+Tools+and+Techniques+for+Determining+the+Value+of+Any+Asset%2C+3rd+E
  • https://doi.org/10.1016/S0378-4266(03)00199-7
  • https://doi.org/10.17265/2328-2169/2016.06.005
  • https://doi.org/10.17265/2328-2169/2016.06.005
  • https://doi.org/10.3846/btp.17.11129
  • https://doi.org/10.3846/btp.17.11129
  • https://doi.org/10.1016/S0378-4266(01)00171-6
  • https://doi.org/10.1080/17421770903541772
  • Fairhurst, D. D., & Nam, Y. (2019). Corporate Governance and Financial Peer Effects. Financial Management. https://doi.org/10.1111/fima.12240
  • Fernandez, P. (2013). Valoración de Empresas por descuento de flujos: lo fundamental y las complicaciones innecesarias. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2089397
  • Fernández, P. (2001). Valuation Using Multiples: How Do Analysts Reach Their Conclusions? SSRN Electronic Journal. https://doi.org/10.2139/ssrn.274972
  • Francis, B. B., Hasan, I., & Kostova, G. L. (2016). When do peers matter?: A cross-country perspective. Journal of International Money and Finance, 69, 364–389. https://doi.org/10.1016/j.jimonfin.2016.06.009
  • French, N. (2013). The discounted cash flow model for property valuations: quarterly cash flows. Journal of Property Investment & Finance, 31(2), 208–212. https://doi.org/10.1108/14635781311302618
  • Fujita, M., & Thisse, J.-F. (1996). Economics of Agglomeration. Journal of the Japanese and International Economies, 10(4), 339–378. https://doi.org/10.1006/jjie.1996.0021
  • Gentry, J., & Reilly, F. (2007). Estimating the intrinsic value of an enterprise with an integrated financial management system.
  • Graham, J. R., & Harvey, C. R. (2001). The theory and practice of corporate finance: evidence from the field. Journal of Financial Economics, 60(2–3), 187–243. https://doi.org/10.1016/S0304-405X(01)00044-7
  • Grennan, J. (2019). Dividend payments as a response to peer influence. Journal of Financial Economics, 131(3), 549–570. https://doi.org/10.1016/j.jfineco.2018.01.012
  • Kantaukov, M., & Sander, P. (2016). Value in the eye of the beholder: a survey of valuation practices of Estonian financial professionals. Investment Management and Financial Innovations, 13(2), 157–172. https://doi.org/10.21511/imfi.13(2-1).2016.04
  • Kaplan, S. N., & Ruback, R. S. (1995). The Valuation of Cash Flow Forecasts: An Empirical Analysis. The Journal of Finance, 50(4), 1059. https://doi.org/10.2307/2329344
  • Karlsson, C., Andersson, M., & Norman, T. (2015). Handbook of Research Methods and Applications in Economic Geography. Edward Elgar Publishing. https://doi.org/10.4337/9780857932679
  • Knudsen, J. O., Kold, S., & Plenborg, T. (2017). Stick to the Fundamentals and Discover Your Peers. Financial Analysts Journal, 73(3), 85–105. https://doi.org/10.2469/faj.v73.n3.5
  • Koller, T., Goedhart, M., & Wessels, D. (2015). Valuation: Measuring and Managing the Value of Companies. New York, USA: John Wiley & Sons.
  • Leary, M. T., & Roberts, M. R. (2014). Do Peer Firms Affect Corporate Financial Policy? Journal of Finance, 69(1), 139–178. https://doi.org/10.1111/jofi.12094
  • LeSage, J. P., & Pace, R. K. (2010). Spatial Econometric Models. In Handbook of Applied Spatial Analysis (pp. 355–376). Berlin, Heidelberg: Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-642-03647- 7_18
  • Malmendier, U., & Tate, G. (2005). CEO Overconfidence and Corporate Investment. The Journal of Finance, 60(6), 2661–2700. https://doi.org/10.1111/j.1540-6261.2005.00813.x
  • Maquieira, C. P., Preve, L. A., & Sarria-Allende, V. (2012). Theory and practice of corporate finance: Evidence and distinctive features in Latin America. Emerging Markets Review, 13(2), 118–148. https:// doi.org/10.1016/j.ememar.2011.11.001
  • Márquez-Pérez, J., Vallejo-Villalta, I., & Álvarez-Francoso, J. I. (2017). Estimated travel time for walking trails in natural areas. Geografisk Tidsskrift-Danish Journal of Geography, 117(1), 53–62. https://doi.org/ 10.1080/00167223.2017.1316212
  • Marshall, A., & Marshall, M. P. (1920). The economics of industry. London, UK: Macmillan & Co.
  • Maskell, P. (2001). The Firm in Economic Geography. Economic Geography, 77(4), 329. https://doi. org/10.2307/3594104
  • https://doi.org/10.1111/fima.12240
  • https://doi.org/10.2139/ssrn.2089397
  • https://doi.org/10.2139/ssrn.274972
  • https://doi.org/10.1016/j.jimonfin.2016.06.009
  • https://doi.org/10.1108/14635781311302618
  • https://doi.org/10.1006/jjie.1996.0021
  • https://doi.org/10.1016/S0304-405X(01)00044-7
  • https://doi.org/10.1016/j.jfineco.2018.01.012
  • https://doi.org/10.21511/imfi.13(2-1).2016.04
  • https://doi.org/10.2307/2329344
  • https://doi.org/10.4337/9780857932679
  • https://doi.org/10.2469/faj.v73.n3.5
  • https://doi.org/10.1111/jofi.12094
  • https://doi.org/10.1007/978-3-642-03647-7_18
  • https://doi.org/10.1007/978-3-642-03647-7_18
  • https://doi.org/10.1111/j.1540-6261.2005.00813.x
  • https://doi.org/10.1016/j.ememar.2011.11.001
  • https://doi.org/10.1016/j.ememar.2011.11.001
  • https://doi.org/10.1080/00167223.2017.1316212
  • https://doi.org/10.1080/00167223.2017.1316212
  • https://doi.org/10.2307/3594104
  • https://doi.org/10.2307/3594104
  • Maté-Sánchez-Val, M., López-Hernandez, F., & Mur-Lacambra, J. (2017). How do neighboring peer companies influence SMEs’ financial behavior? Economic Modelling, 63, 104–114. https://doi. org/10.1016/j.econmod.2017.01.023
  • Mate-Sanchez, M., López Hernández, F. A., & Lacambra, J. M. (2012). Analyzing long-term average adjustment of financial ratios with spatial interactions. Economic Modelling, 29(4), 1370–1376. https:// doi.org/10.1016/j.econmod.2012.03.001
  • Mielcarz, P., & Osiichuk, D. (2017). What is Behind the Figures? Conceptual Mistakes in the Equity Valuations Prepared by Research Analysts in Poland. Zeszyty Naukowe Uniwersytetu Szczecińskiego Finanse Rynki Finansowe Ubezpieczenia, 1, 363–375. https://doi.org/10.18276/frfu.2017.1.85-30
  • Miloud, T., Aspelund, A., & Cabrol, M. (2012). Startup valuation by venture capitalists: an empirical study. Venture Capital, 14(2–3), 151–174. https://doi.org/10.1080/13691066.2012.667907
  • Modigliani, F., & Miller, M. H. (1958). The cost of capital, corporation finance and the theory of investment. American Economic Review, 48(3), 261–297.
  • Moran, P. (1950). Notes on continuous stochastic phenomena. Biometrika, 37(1–2), 17–23. https://doi. org/10.1093/biomet/37.1-2.17
  • Occhino, P., & Maté, M. (2017). Geographical proximity on the valuations of unlisted agrarian companies: Does distance from company to company and to strategic points matter? Spanish Journal of Agricultural Research, 15(2), e0112. https://doi.org/10.5424/sjar/2017152-10282
  • Occhino, P., & Maté, M. (2019). Valuation of small to medium sized companies using spatial information: An empirical example from the fruit subsector. Spanish Journal of Agricultural Research, 16(4), e0112. https://doi.org/10.5424/sjar/2018164-13387
  • Park, K., Yang, I., & Yang, T. (2017). The peer-firm effect on firm’s investment decisions. The North American Journal of Economics and Finance, 40, 178–199. https://doi.org/10.1016/j.najef.2017.03.001
  • Petersen, C., Plenborg, T., & Scholer, F. (2006). Issues in Valuation of Privately Held Firms. The Journal of Private Equity, 10(1), 33–48. https://doi.org/10.3905/jpe.2006.667557
  • Pettit, R. R., & Singer, R. F. (1985). Small Business Finance: A Research Agenda. Financial Management, 14(3), 47. https://doi.org/10.2307/3665059
  • Plenborg, T., & Pimentel, R. C. (2016). Best Practices in Applying Multiples for Valuation Purposes. The Journal of Private Equity, 19(3), 55–64. https://doi.org/10.3905/jpe.2016.19.3.055
  • Rajan, R. G. (1994). Why Bank Credit Policies Fluctuate: A Theory and Some Evidence. The Quarterly Journal of Economics, 109(2), 399–441. https://doi.org/10.2307/2118468
  • Raza, S. A., & Karim, M. Z. A. (2018). Influence of Systemic Banking Crises and Currency Crises on the FDI-Growth Nexus: Evidence from China. Global Business Review, 19(3), 572–589. https://doi. org/10.1177/0972150917713883
  • Rojo-Ramírez, A. (2013). Valoración de la empresa por descuento de flujos de efectivo: la importancia del tipo de inversor. Análisis Financiero, (121), 6–16. Retrieved from https://www.ieaf.es/component/k2/ item/download/566_884ed392eb01d0bacc2746b7e171087a.html
  • Rojo-Ramirez, A., Alonso Canadas, J., & Cruz-Rambaud, S. (2011). Discount Rate and Cost of Capital: Some More about the Puzzle. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2034163
  • Rojo-Ramírez, A., & García-Pérez de Lema, D. (2005). Valuation of small and medium enterprises.
  • Schreiner, A. (2007). Equity Valuation Using Multiples. Wiesbaden: Gabler. https://doi.org/10.1007/978-3- 8350-9531-1
  • Selan, B., & Kalatzis, A. E. G. (2017). Peer effects of stock returns and financial characteristics: Spatial approach for an emerging market.
  • Sharpe, W. F. (1964). Capital asset prices: A theory of market equilibrium under conditions of risk. The Journal of Finance, 19(3), 425–442. https://doi.org/10.1111/j.1540-6261.1964.tb02865.x
  • https://doi.org/10.1016/j.econmod.2017.01.023
  • https://doi.org/10.1016/j.econmod.2017.01.023
  • https://doi.org/10.1016/j.econmod.2012.03.001
  • https://doi.org/10.1016/j.econmod.2012.03.001
  • https://doi.org/10.18276/frfu.2017.1.85-30
  • https://doi.org/10.1080/13691066.2012.667907
  • https://doi.org/10.1093/biomet/37.1-2.17
  • https://doi.org/10.1093/biomet/37.1-2.17
  • https://doi.org/10.5424/sjar/2017152-10282
  • https://doi.org/10.5424/sjar/2018164-13387
  • https://doi.org/10.1016/j.najef.2017.03.001
  • https://doi.org/10.3905/jpe.2006.667557
  • https://doi.org/10.2307/3665059
  • https://doi.org/10.3905/jpe.2016.19.3.055
  • https://doi.org/10.2307/2118468
  • https://doi.org/10.1177/0972150917713883
  • https://doi.org/10.1177/0972150917713883
  • https://www.ieaf.es/component/k2/item/download/566_884ed392eb01d0bacc2746b7e171087a.html
  • https://www.ieaf.es/component/k2/item/download/566_884ed392eb01d0bacc2746b7e171087a.html
  • ttps://doi.org/10.2139/ssrn.2034163
  • https://doi.org/10.1007/978-3-8350-9531-1
  • https://doi.org/10.1007/978-3-8350-9531-1
  • https://doi.org/10.1111/j.1540-6261.1964.tb02865.x
  • Shue, K. (2012). Executive Networks and Firm Policies: Evidence from the Random Assignment of MBA Peers. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1973031
  • Vidal-Garcia, R., & Ribal, J. (2019). Terminal Value in SMEs: Testing the Multiple EV/EBITDA Approach. Journal of Business Valuation and Economic Loss Analysis, 14(1). https://doi.org/10.1515/jbvela-2018-0012
  • Vidal, R., & Ribal, J. (2018). Valuation of agrifood SMEs. Lessons to be learnt from the stock market. Spanish Journal of Agricultural Research, 15(4). https://doi.org/10.5424/sjar/2017154-11668
  • Weber, A. (1922). Ueber den standort der industrien. Tübingen: Verlag von J.C.B.Mohr (Paul Siebeck). Retrieved from http://library.wur.nl/WebQuery/clc/423505
  • Woolley, S. (2009). Sources of value: A practical guide to the art and science of valuation. Cambridge, UK: Cambridge University Press. https://doi.org/10.1017/CBO9780511626739
  • World Bank. (2009). World development report 2009: Reshaping economic geography. Retrieved from http://documents.worldbank.org/curated/en/730971468139804495/ pdf/437380REVISED01BLIC1097808213760720.pdf
  • Zaighum, I., & Karim, M. Z. A. (2019). Peer effects and capital structure: A review of literature. International Journal of Innovative Knowledge Concepts, 7(3). Retrieved from http://www.ijikc.co.in/index.php/ijikc/ article/view/1755
  • https://doi.org/10.2139/ssrn.1973031
  • https://doi.org/10.1515/jbvela-2018-0012
  • https://doi.org/10.5424/sjar/2017154-11668
  • http://library.wur.nl/WebQuery/clc/423505
  • https://doi.org/10.1017/CBO9780511626739
  • http://documents.worldbank.org/curated/en/730971468139804495/pdf/437380REVISED01BLIC1097808213760720
  • http://documents.worldbank.org/curated/en/730971468139804495/pdf/437380REVISED01BLIC1097808213760720
  • http://www.ijikc.co.in/index.php/ijikc/article/view/1755
  • http://www.ijikc.co.in/index.php/ijikc/article/view/1755