Research On The Valuation Of Internet Technology Companies

With the innovation and upgrading of global Internet technology and big data technology,a new round of scientific and technological revolution is about to begin.In recent years,China's Internet economy has maintained sustained and rapid development,the potential of the Internet industry has been continuously demonstrated,and an amazing vitality has erupted.Background cross-border integration "Internet+" industry has become the focus of attention and hot topic in the investment community.Among them,the integration of "Internet+technology"has become one of the popular directions.The success of Internet companies represented by BAT has attracted many Internet technology companies to go public,and for individual investors and various institutional investors,they can conduct a reasonable value assessment of the target company to obtain its true intrinsic value.Provide a more reliable investment basis for its investment,and choose the right time to make the right investment,which is conducive to real income for investors.At the same time,for the managers of Internet technology companies,through the correct value evaluation method,reasonable evaluation of the company's intrinsic value,and formulating a suitable company development strategy plan,it is conducive to the company's long-term goals,continuous innovation and development,and become the industry leader,Become the backbone of the capital market,and provide shareholders with high returns.With the upgrade and development of big data and the Internet,the Chinese government continues to encourage the development of Internet companies,accelerate the integration with traditional industries,and launch various policy supports.The Internet technology industry has broad development prospects.In this era,the valuation of Internet technology companies has become a focus of China's financial academia.In recent years,the technology of the Internet technology industry has been rapidly updated,and innovative business models have continuously emerged.As an emerging industry,China's Internet technology industry has a relatively short development time,a relatively fast company update frequency,a large proportion of asset-light assets,a large investment in R&D in the early stage,a very unstable profit and cash flow,and may be negative.The characteristics of the development cycle are different from those of traditional companies.As a result,some traditional commonly used value evaluation methods have certain limitations when evaluating Internet companies,and the valuation results have large deviations.Looking at the listed Internet technology companies that have received much attention in recent years,such as 360,Huiliang Technology,Tencent Music,iQiyi,Mushroom Street,and Ping An Good Doctor,all of them have fallen below the issue price on the first day of listing.Situation.If the long-term inaccurate valuation leads to a high valuation,it will affect the development of the Internet technology industry.High-quality listed companies cannot raise reasonable funds and cannot carry out strategic development.For companies that want to earn a valuation premium through listing,they have adopted a premium to list,resulting in the phenomenon of bad currencies expelling good currencies in the stock market.These conditions will not only hinder the development of the Internet technology industry,but also be detrimental to the health and stability of China's capital market.Therefore,choosing a suitable valuation method is critical for Internet technology companies to conduct reasonable valuation.This article compares the applicability of the valuation model of the economic value-added method and some other traditional valuation methods to the valuation of Internet companies,including the advantages and disadvantages of various valuation methods in theory,and combines the characteristics of Internet technology companies.The valuation model of economic value-added method is a method suitable for the valuation of China's Internet technology companies,and through the valuation of the case company Mi Group,the feasibility and applicability of the economic value-added method is proved.This article studies the value evaluation methods of China's Internet technology companies through six parts.The introduction of the first part of the paper first introduces the background,research significance and research content of this paper;then the second part of the paper focuses on the valuation methods of traditional companies at home and abroad.The research literature of Internet companies 'valuation methods is analyzed and reviewed;the third part of the paper divides the current company's valuation methods into absolute valuation methods and relative valuation methods,and lists different valuation calculation methods respectively.Their respective advantages and disadvantages,combined with the characteristics of Internet technology companies,analyze and select a suitable valuation method.The fourth part of the paper first analyzes the basic situation and financial data of the case company Mi Group.At the same time,it analyzes the reasons for its listing valuation premium from three aspects:macro policy support,Internet technology industry development prospects and Mi Group's growth expectations.And analyze the rationality of the definition of Mi Group Internet Technology Company.The fifth part of the paper combines the characteristics of Mi Group and uses EVA method and price-earnings ratio method to carry out valuation analysis on Mi Group.After the previous analysis and research,the sixth part of the paper summarizes the relevant conclusions and the deficiencies that need to be improved.Due to the diversity of the business models of Internet technology companies and the particularity of valuation,after analyzing several valuation methods of Internet companies commonly used in daily practice,it can be seen that no valuation method is perfect for Internet companies Yes,no Internet enterprise valuation method is absolutely reasonable and absolutely applicable.Each valuation method has its unavoidable limitations and has a certain scope of application.However,compared with other valuation methods such as the DCF valuation model,the EVA valuation model has certain advantages.Therefore,in the current valuation practice of Internet technology,the EVA valuation model can be used as a more reliable The valuation method,combined with other valuation methods as auxiliary methods,makes the valuation more accurate.