The value of a web hosting company depends on a variety of metrics. We will determine a number we deem appropriate through the Discounted Cash Flow (DCF) valuation method. We estimate future cash flow by combining net income and depreciation/amortization minus capital expenditures and change in working capital. This free cash flow will be discounted to a present value by using the company’s weighted average cost of capital (WACC). WACC is an optimal balance of the company’s equity-to-debt ratio.
We will also account for potential synergies such as savings (consolidations), financial (reducing debt),revenue (service expansion), more manpower, and higher production capacity.
To find out exactly how much your web hosting company is worth, please give us a call or fill out the contact form below: