Financial Analysis, Corporate Valuation, and Capital Formation

This book integrates the concepts of book value, market value, and increases thereof in the valuation of the firm. It presents an advanced analysis of financial statements, of stock and bond valuation, and of capital budgeting. Alternative cash flow calculations, analysis of multiple projects, capital structure considerations, and decision tree analysis are also presented. It considers merger and acquisition as the ultimate capital budgeting decision and bankruptcy as the ultimate abandonment decision. It underpins this integration with a short history of the finance literature and U.S. financial institutions, the theory of financial markets and securities, and time value of money.