CHICAGO, April 20 /PRNewswire-FirstCall/ -- Morningstar,
Inc. (Nasdaq: MORN), a leading provider of independent investment
research, has launched a valuation services business that values
privately owned firms and securities for purposes such as the sale
of a business, estate planning, or financial reporting.
Morningstar® Valuation Services leverages Morningstar's proprietary
techniques for analyzing securities and the cost of capital
expertise of Ibbotson Associates, a wholly owned subsidiary of
Morningstar.
"Valuation consulting is a natural extension of the cost of
capital research and litigation support work Ibbotson has been
doing for more than 20 years," said Alfonso
Ventoso, director of valuation services for Morningstar.
"Our independence allows us to focus solely on business valuation,
rather than merger and acquisition activity or tax and audit
advice, which helps us provide purely objective results."
The new valuation consulting service covers business valuations
for companies as a whole, specific securities, or intangibles
across all major industries and for firms of any size. Independent
business appraisals through Morningstar Valuation Services can help
owners assign value for: a sale, shareholder transactions,
succession planning, employee stock option plans, fairness
opinions, or purchase price allocation. In addition, the team can
help with financial reporting tasks, such as fair value
calculation, goodwill impairment, and share-based payment.
Valuations of intangibles are also available, such as patents,
startups, royalty streams, and goodwill. Additionally, the
valuation team continues to provide litigation support and expert
witness testimony in situations where business valuations are
contested.
Each valuation starts with an on-site visit from Morningstar's
team of valuation practitioners, to better understand the business
and its individual needs. The team completes a detailed analysis of
the company compared to its competitors, which is then subjected to
a rigorous in-house peer review. The analysis is based on factors
such as:
- Cost of Capital—decades of Ibbotson research helps set the
industry standard for measuring business risk.
- Economic Moat™—a proprietary calculation that measures a
company's competitive advantage.
- Cash-Flow Cushion™—a proprietary, forward-looking ratio that
measures forecasted cash flows against a firm's financial
obligations.
- Distance to Default—a quantitative model that estimates the
probability of a firm falling into financial distress based on the
market value and volatility of its assets.
Ibbotson first published the Ibbotson®
SBBI® Valuation Yearbook, an industry-standard
reference book for business valuation, in 1999. Ibbotson's
valuation practitioners have published numerous academic papers on
cost of capital and valuation, and have served as expert witnesses
in valuation-related litigation cases for more than two
decades.
About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent
investment research in North
America, Europe,
Australia, and Asia. The company offers an extensive line of
Internet, software, and print-based products and services for
individuals, financial advisors, and institutions. Morningstar
provides data on approximately 350,000 investment offerings,
including stocks, mutual funds, and similar vehicles, along with
real-time global market data on more than 4 million equities,
indexes, futures, options, commodities, and precious metals, in
addition to foreign exchange and Treasury markets. The company has
operations in 20 countries and minority ownership positions in
companies based in two other countries.
©2010 Morningstar, Inc. All rights reserved.
MORN-P
Media Contact:
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Shawn Malayter, 312.696.6050,
shawn.malayter@morningstar.com
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SOURCE Morningstar, Inc.