Valuation vs. Appraisal - Radio Station Valuation

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Radio Station Valuation
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VALUATION VS. APPRAISAL:
There is some "confusion" in the industry about the difference between a "valuation" and an "appraisal".

Valuation: A radio station valuation is commonly expressed as Fair Market Value (“FMV”).

FMV is generally defined as the cash, or cash equivalent, price for which a property would change hands between a willing buyer and a willing seller in an arms length transaction, both being adequately informed of the relevant facts, and neither being compelled to buy or sell.  In the absence of an actual sale, Fair Market Value may be estimated using industry accepted guidelines.


The FMV of a radio station uses one, or more, of these metrics:
  • Operating Income
    • Cash Flow
    • Broadcast Cash Flow
    • EBITDA
  • Population Covered by Standard Contour
  • Multiple of Revenue

Appraisal: An Appraisal is an estimate of the market value of property, usually real estate.  It does not consider the value of operating income from the property.  Physical assets such as buildings or land rarely comprise a significant portion of a radio station's fair market value.
24645 S Augusta Court
Sun Lakes, Arizona  85248

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Clifton Gardiner & Company, LLC
Clifton Gardiner & Company
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