Adjusted Book Value takes true fair market value of all assets and liabilities into account. Adjusted Book Value tends to be used when a company has been devalued to the point of facing possible bankruptcy and liquidation.
Book value in general does not account for intangible assets, such as intellectual property, so it is more useful in assessing the risk of loss in a foundering company than the earnings potential of a profitable company. Technically the adjustments to book value will raise or lower the value of assets and liabilities according to current fair market value.
Fair market value is the replacement value or salvage value of an asset. It can be appropriate for valuation of real estate holding companies and investment companies, both of which are mostly constituted by the fair market value of their assets.
Revenue Ruling 59-60 actually states that earnings valuations, and not adjusted book value, is the preferred method to value companies who are anticipated to be liquidated.
A strangle is an options strategy which is profitable if the price of the underlying security swings either up or down
Net worth is the total value of a person or entity’s assets, minus all of their outstanding liabilities
Operating expenses are the costs a company incurs as a part of everyday business operations
Acquiring technologies to abate their environmental impact, and the overhead of such projects is called Abatement Cost
Cash flow after taxes (CFAT) is nearly the same thing as EBITDA, but with taxes left in
Ripple does several things, serving as a protocol for decentralized currency exchange and transfers of value, primarily focused on the financial service industry
Who would have thought that a 19 year-old from Toronto could write a whitepaper nearly as influential as Satoshi Nakamoto’s (Bitcoin founder)?
The Broadening Wedge Ascending pattern forms when a currency pair price progressively makes higher highs and higher lows
Options can be a valuable tool in portfolio management, but investors should be well-versed in how options work