What Is Valuation?

The analytical process of assessing the present (or anticipated) value of an asset or a firm is known as valuation. A valuation can be done using a variety of methods. When determining a company’s worth, analysts consider the company’s management, capital structure, future earnings prospects, and market value of its assets, among other factors.
Although fundamental research is frequently used in valuation, alternative approaches such as the capital asset pricing model (CAPM) or the dividend discount model may also be used (DDM).