Achille Ekeu, The President and CEO of The Washington Valuation Group located in Washington DC met with Melissa Gragg, a business valuation expert located in Missouri and publisher of Valuationpodcast.com to talk about the impact of COVID-19 on business valuations. The interview was for about 45 minutes during which, Achille shared a great deal of information about what is happening on the market today and how various stakeholders are doing to keep up with the pandemic.
Achille Ekeu shares his Expert's thoughts on the best way to measure the impact of COVID-19 on business valuation and suggests three critical value-drivers that must be looked at: Cash Flow, Growth, and Risk.
A new non-GAAP metric called "EBITDAC" has appeared from nowhere in various financial statements from many organizations seeking to mitigate the impact of the pandemic on their cash flows. Achille Ekeu addresses that issue that could be problematic for the different stakeholders using those financial statements to determine the value of a company, to give a loan, to invest, to buy, to sell, and to make many other decisions related to those companies. Regulators like the SEC and many investors-protection organizations around the world are sounding the alarm on the use of that non-GAAP metric in financial reports and recommending that this metric not be used.
To find out more about these topics watch the full video below:
Here is the link to listen to the audio-only version of this conversation.