DEVELOPPEMENT DURABLE, FLUX COMPTABLES ET EVALUATION D'ENTREPRISE

Paul Amadieu () and Jean-Laurent Viviani ()
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Paul Amadieu: CR2M - UM2 - Université Montpellier 2 - Sciences et Techniques

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Abstract: The objective of this paper is to investigate the impact of non sustainability on company value. Non sustainability is defined as the incapacity for the present business model to perpetuate the same cash flow or the same profit generation. The consequence of non sustainability must be a dramatic drop in company value. This impact of non sustainability is often neglected by the traditional two steps discount cash flows method or by the residual income model. Thus empirical valuation methods presuppose often without any investigation a perfect sustainability of the present business model. Using a double exponential jump diffusion process do describe the evolutions of the company's asset, we are able to describe the consequences of large downward jumps on the asset value on the debt, equity and company value. Numerical simulations show that this impact is non linear and could be quite large especially on companies with large leverage.

Keywords: discounted cash-flows valuation method; residual income model; valuation; non sustainability; jumps diffusion process; actualisation des flux de trésorerie; résultat résiduel; évaluation; non-durabilité; processus à saut. (search for similar items in EconPapers)
Date: 2010-05-10
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Published in Crises et nouvelles problématiques de la Valeur, May 2010, Nice, France. pp.CD-ROM

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