Adam Bulakowski, Principal Partner, is the Author of "Valuation of Public Equities, Including Alphabet, Amazon, Apple: Capital Market Pricing of Opaque Intangible Assets"  

POSTED BY ipCG Team AT 8:07 A.M. August 01, 2016

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Below is an excerpt from the August, 2016 white paper. Read the full paper here.

Summary

Investors have driven the valuations of these 3 tech giants (and a select few others) well past their peers, not to mention into a different league from leaders in most other sectors.  Elite private companies are achieving similarly high multiples, given their access to a large supply of capital competing for few high yield options.
Why and how do investors assign a premium on innovation-related growth potential?

The answer requires dissecting the promise of growing cash returns on invested capital.  In summary, these equity investors look beyond traditional financial reporting to see the cash ROI in technology-based intangible assets.

Takeaways for diligence on knowledge intensive businesses


TAGS: Adam Bulakowski | ipCG Team | Metrics | Valuation