Relative total shareholder return (TSR) has become a key metric in executive compensation, linking payouts to shareholder outcomes. As adoption grows, companies face challenges in plan design, peer group selection, and valuation under ASC 718. In this article, we explore trends, implementation hurdles, and valuation considerations for relative TSR awards.
Estate planning for business owners becomes much more complicated when a merger or acquisition process is underway. IRS guidance establishes requirements that business valuations for transfer tax purposes must consider all knowable facts as of the valuation date—including pending transaction processes. This creates both opportunities and risks for estate planners working with clients who own businesses actively engaged in sale discussions.
Rollover equity is playing an increasingly important role in U.S. middle market private equity deals, allowing sellers to exchange a portion of their equity for a stake in the acquiring entity. This structure benefits buyers by easing financing and aligning incentives, while giving sellers immediate liquidity and potential future upside—the “second bite of the apple.” As rollover equity becomes more common, careful attention to valuation, deal structure, and long-term exit expectations is critical.
Understanding a company’s unique risk profile is critical when valuing a business. This article explores the Company Specific Risk Premium (CSRP) — a key component of the discount rate — and the qualitative and quantitative factors that influence it, from customer concentration to management depth and industry dynamics.
The second quarter of 2025 brought rapid shifts in the tariff landscape, from sweeping “reciprocal” tariff announcements to last-minute pauses and new trade agreements. While the 10% baseline tariff remained in effect, rates on certain imports—especially from China and the EU—fluctuated dramatically amid ongoing negotiations. For the transportation sector, the 90-day pause on many tariffs provided temporary relief, but rising personal consumption expenditures suggest inflationary pressures are building. As Q3 begins, the transportation industry faces continued uncertainty as trade talks progress and the cycle of tariff changes resumes.
The first quarter of 2025 brought significant tariff activity, beginning with President Trump’s January 20 executive order and culminating in a series of levies targeting major U.S. trading partners, particularly Canada, China, and Mexico. Frequent policy shifts, pauses, and retaliatory measures created uncertainty across the transportation and logistics sector. Notable developments included the removal (and delay) of De Minimis exemptions on low-value imports from China, early stockpiling of goods ahead of tariff deadlines, and new investigations into copper and lumber imports. While these measures temporarily boosted transportation activity, sustained tariffs are expected to dampen trade volumes and strain domestic supply chains.
As Stablecoins move from the fringes of finance to the center of regulatory and market attention, banks face a familiar but evolving challenge to their deposit base. Nearly 50 years after the introduction of the cash management account, Circle’s IPO and the passage of the GENIUS Act may mark a new inflection point. With investor enthusiasm high and policymakers signaling support, traditional institutions will need to evaluate how, and how quickly, they respond to the rise of tokenized money.
This month, Zac Lange authored a mid-year economic and financial trends review and outlook for Mercer Capital’s Family Business Director Blog. As a timely and relevant piece to the grander economy, we chose to feature the piece on this month’s Valuation and Forensic Insights.
The One Big Beautiful Bill Act, signed into law on July 4, addresses the sunsetting estate tax provisions of the 2017 Tax Cuts and Jobs Act. In this issue of Value Matters, we explore the OBBBA’s valuation implications for tax and estate planning professionals.
While bank M&A activity has been steady in 2025, boards evaluating offers should look beyond headline prices to scrutinize the real value of consideration—especially when deals are paid in acquirer stock. A high stock price can make a transaction look attractive, but it also masks risks tied to dilution, liquidity, and the buyer’s future performance. Fairness opinions, detailed due diligence, and a clear-eyed assessment of the acquirer’s shares are essential to protect selling shareholders from unpleasant surprises once the deal closes.
Divorce is often an emotionally and financially draining process, and estate planning may be the last thing on the minds of the divorcing parties. However, reviewing estate plans during a divorce can be a step in preparing for the future. Like many aspects of divorce, timing matters and there are both advantages and drawbacks to updating your estate documents while the divorce is still pending.
The 2025 U.S. Tax Court opinion in Kaleb J. Pierce v. Commissioner of Internal Revenue (T.C. Memo 2025-29) offers insight on several issues that regularly feature in the valuations of privately held business interests. By presenting an issue-by-issue analysis, the Pierce decision reinforces an important message for appraisers and estate planners: relevant data and reasoned analysis carry the day in court.
With investors favoring dividend-paying funds amid equity market volatility, we examined the role of dividends in bank shareholder returns over the past decade. While dividends made up a significant portion of total returns, especially in a middling decade for bank stocks, our analysis shows they are not the sole driver. Long-term shareholder value is still rooted in growing earnings and book value—even in uncertain times.
After years of booming mortgage profits driven by ultra-low rates, the industry has faced a prolonged slump amid stubbornly high mortgage rates and weakened housing demand. Despite rate cuts by the Fed, affordability remains strained, and mortgage volumes lag forecasts. However, transaction volume is expected to pick up despite high rates while home prices remain flattish, which should serve to boost mortgage originations. Major moves by Rocket Companies, including acquisitions of Redfin and Mr. Cooper, hint that the worst may be over and a recovery in mortgage banking could be taking shape.
A recent $45 million settlement between UPS and the SEC over allegedly flawed goodwill impairment tests and earnings overstatements puts a spotlight on the goodwill impairment testing process. Whether it be market volatility, uncertainty around tariffs, or simply poor performance at a reporting unit (as was the case for UPS), proper evaluation of goodwill impairment testing inputs is critical to getting the process and numbers right and potentially avoiding a fine. The impairment charge in this case may have been a non-cash item but the civil penalty was a real expense.
In this article we explore how fund principals in private equity, venture capital, and hedge funds earn a share of profits—known as carried interest—when performance exceeds benchmarks. The article breaks down fund structures, highlights valuation challenges, and emphasizes the need for experienced appraisers to navigate the complexities involved in assessing these interests.
What is driving the future of the medical device industry? From powerful demographic shifts to technological innovation and global market expansion, we discuss five key trends that are reshaping the landscape in 2025 and beyond. But it is not all smooth sailing—rising trade tensions, regulatory changes, and evolving reimbursement models could bring new challenges.
Stryker Corporation made bold moves in 2024, snapping up a number of companies and setting the stage for growth in 2025. With a $4.8 billion deal among a series of strategic acquisitions, and stock surging 34%, what’s next for this medical tech giant? CEO Kevin Lobo states “M&A will be the number one use of the company’s cash going forward.” In this article we look into some of the SYK acquisitions over 2024.
This article explores the strategic incorporation of carried interests in estate planning, particularly for newly formed private equity funds. It discusses the benefits and complexities of leveraging such interests under current economic conditions and tax regulations to optimize estate outcomes.
After a strong 2H24, community and regional bank stocks are down 5% in Q1 2025 and are down about 15% from late November when bank stocks peaked in a run that started mid-year. Valuations for individual stocks, a sector such as banking and the overall market will ebb and flow with a variety of factors, but ultimately earnings and earnings growth are the mother’s milk of investing. One asset manager years ago provided a useful framework to think about profitability, growth, and valuation as a framework for stock selection.
This article discusses important concepts of personal vs. enterprise goodwill in valuations for divorce. It is important to understand the business, industry, and efforts of the divorcing spouse(s) & non-divorcing parties to perform a thorough, supportable analysis. It is also important to know how each state treats personal goodwill – some states consider personal goodwill to be a separate asset, and some do not make a specific distinction for it and include it in the marital assets. Additionally, while there are several accepted methodologies for determining % allocations to personal vs. enterprise, there are not uniform standards nor guidelines that govern the how-to’s; as such these analyses are complex and require subject matter expertise.
Potential IRS layoffs and uncertain estate tax policies create a shifting landscape for estate planning. While enforcement may decline temporarily, tax laws evolve, and estate tax repeal remains uncertain. Prudent planning, including adherence to Adequate Disclosure Regulations, ensures long-term protection and stability. Staying proactive is key to navigating future changes.
The 2025 Acquire or Be Acquired (AOBA) Conference in Phoenix reflected a renewed sense of optimism for the banking industry. With small-cap banks rebounding in late 2024 and earnings growth on the horizon, the outlook for M&A is improving. Increased capital market activity, pent-up demand from buyers and sellers, and a shifting regulatory environment all signal a potential acceleration in bank deals this year.
Read our full breakdown of AOBA’s key themes and insights in this month’s BankWatch.
After the turbulence caused by rising interest rates and regional bank failures, 2024 marked a turning point for community and regional bank stocks. The S&P Small Cap Bank Index surged 23% in the second half of the year, buoyed by optimism around net interest margins and a friendlier regulatory environment. However, challenges remain for smaller banks in 2025, such as weak loan growth and higher-for-longer short-term interest rates that may limit NIM expansion. Meanwhile, larger banks look poised to benefit from rising capital markets activity. While the outlook for bank earnings in 2025 is positive, this should be viewed in the context of a richly valued stock market where index fund and ETF outflows pose a threat to bank stock performance. We look back on 2024 performance and consider factors that may influence bank stock performance in 2025.