MODELS FOR DETERMINING THE ECONOMIC VALUE OF CABLE-TELEVISION SYSTEMS

Five profit-based valuation models are estimated from a recent group o f announced cable system sales. The regression-based models identify d eterminants of cable systems' economic value, provide elasticities, an d explain over 99% of the variation in value for a sample that reflect s the industry trend of consolidation. System appraisers can use both the model coefficients as well as the method to obtain baseline averag e levels of economic value from which transaction premiums or discount s can then be considered.