Study On Enterprise Value Assessment Of Z Company

In recent years,with the rapid development of computer network technology and the rise of the new Internet business model,all kinds of Internet companies are developing rapidly and playing an important role in all walks of life.At the same time,the actions(listing,mergers and acquisitions)of Internet companies are becoming more and more frequent.The smooth conduct of these economic activities depends largely on the correct evaluation of enterprise value.Under this circumstances,how to evaluate the value of Internet companies has become a hot topic.However,comparing with traditional enterprises,the high-end technology Internet companies have their own uniqueness.Simply using traditional value evaluation methods can be limited.Therefore,it is necessary for us to understand the value structure of the Internet enterprise--a new economic entity,and to explore the method of value evaluation that is suitable for Internet companies.In this paper,Z company,which is closely related to the Internet,is chosen as the object of the case study.As one of the representatives of Internet companies,Z company has developed rapidly in recent years and has gradually become the leading enterprise in the industry.The author hopes to provide reference for other enterprises of the same type by estimating the value of Z company.Firstly,this paper introduces the background,the purpose and significance of the research,and summarizes the research results of Internet enterprises value evaluation of domestic and foreign scholars.Secondly,this paper takes the characteristics of the Z company as the starting point,through introduces the traditional value evaluation methods and its advantages and disadvantages,then analyses its application in Z company.And the paper introduces the real option theory and expounds the compatibility between the theory and the valuation of Z company.On this basis,this paper constructs a model for the valuation of Z company.At last,the applicability of the model is verified by the specific value estimation of Z company,and the significance of the case for the evaluation of Internet enterprise value is expounded.This paper argues that although the free cash flow model plays an important role in the enterprises value evaluation,due to the characteristics of high risk,high return,high uncertainty of light assets,the potential value of future investment of this model cannot be reflected in the results of the assessment.Thus it can be easy to underestimate the value of the enterprises to be assessed.So that the potential value of its future investment can not be reflected in the results of the assessment,which is easy to underestimate the value of the enterprise to be assessed.Therefore,this paper introduces the idea of real option to the limitation of income method,and expounds how to evaluate the potential value of future investment by real option pricing model.In this paper,the value of Internet business is divided into two parts,that is,the value of existing assets and the potential value of future investment projects.By using the free cash flow model and the real option model separately to evaluate the results of the two parts,the value of Internet companies can be seen comprehensively.