I am looking for a formula that a private company uses to determine
the value of their company stock.  SAIC (Science Applications
International Corp.) is a private company that files appropriate
reports with the SEC.  In their 10K, they show the formual that an
indepedent firm uses to determine the stock value.  I will pay $25 for
the identity of another private company that uses a similar formula. 
This formula must be contained on a report filed with the SEC and can
be viewed on at www.sec.gov.  Thanks.

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Request for Question Clarification by pafalafa-ga on 19 Oct 2004 14:18 PDT

I'm not sure exactly what formula of SAIC's you are referring to, but
there are certainly other private companies that provide valuation
information to the SEC.

For instance, is this passage along the lines of what you're looking for:

==========
The Company?s assets and liabilities were revalued using push-down
accounting to reflect the purchase price adjustments recorded by
Systems. The purchase price adjustments were based on fair values
assigned to net assets as determined by an independent valuation firm
using standard valuation techniques. The fair market values of
patents, developed and in-process technologies were determined using
the income approach, which discounts management?s best estimate of
future cash flows to present value using a discount rate of 16% for
developed technology and 21% for in-process technology, as adjusted to
reflect additional risks inherent in the development life cycle. The
fair market value of the acquired customer base was estimated based on
market prices in actual transactions and on asking prices for assets
currently available for sale. The fair market value of the acquired
workforce was estimated based on a replacement cost approach. Acquired
intangible assets are amortized on a straight-line basis over their
estimated useful life of two years. The approximate fair value of the
assets and liabilities acquired amounted to $231.5 (including $13.4 of
acquired in-process technology) and $80.0, respectively and are
detailed as follows:

  Current assets $ 113.0  
  Fixed assets  23.4  
  Intangible assets  92.2  
  Other long-term assets  2.9  


 
  Total assets  231.5 

==========

The section continues with a lot of additional information about the
company's valuations, but I'm not sure if this is the sort of
"formula" you're looking for.

Let me know what you think.

pafalafa-ga

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Clarification of Question by reskone1-ga on 20 Oct 2004 13:30 PDT

Dear pafalfa-ga.  Thanks for your prompt reply and request for clarification.

They information you provided does not explain how the private company
uses the financial information to determine the price for the stock. 
SAIC uses an formula that they include in their 10K filed with the
SEC.  The following is from the most current 10K and includes the
actual foruma.  Please excuse the lenght of the following and the
"wrap around" of the screen display.  The actual 10K can be reviewed
at www.sec.gov.

I desire information about how other private companies compute the
stock value and report it to the SEC.

See below.  Thanks.

      Stock Price Formula

        The following formula is used in the valuation method:

      the price per share is equal to the sum of

              (1)   a fraction, the numerator of which is our
stockholders' equity at the end of the fiscal quarter immediately
preceding the date on which a price determination is to occur,
adjusted to reflect the value of our publicly traded equity securities
classified as investments in marketable securities, as well as the
profit or loss impact, if any, on stockholders' equity arising from
investment activities, non-recurring gains or losses on sales of
business units, subsidiary common stock or similar transactions
closed, as of the valuation date ("E") and the denominator of which is
the number of outstanding common shares and common share equivalents
at the end of such fiscal quarter ("W(1)") and

              (2)   a fraction, the numerator of which is 5.66
multiplied by the market factor ("M" or "market factor"), multiplied
by our operating income for the four fiscal quarters immediately
preceding the price determination, net of taxes, excluding investment
activities, losses on impaired intangible assets, non-recurring gains
or losses on sales of business units, subsidiary common stock and
similar items, and including our equity in the income or loss of
unconsolidated affiliates and the minority interest in income or loss
of consolidated subsidiaries ("P"), and the denominator of which is
the weighted average number of outstanding common shares and common
share equivalents for those four fiscal quarters, as used by us in
computing diluted earnings per share ("W").

        The formula, shown as an equation, is as follows:

Stock Price = 	  	E 	  	+ 	  	5.66MP
  	  	-------------------------	  	 ----------------- 	  	
  			W(1) 	  	  	  	W


        The board of directors first used a valuation formula in
establishing the price of the Class A common stock in 1972. The
valuation formula has periodically been modified ever since. The
market factor concept was first added to the formula in 1973. The 5.66
factor was added to the formula in 1976 as a constant to cause the
price generated by the formula to reflect a fair market value of the
Class A common stock. In 1984, the board of directors, with the
assistance of an outside appraisal firm, began its current practice of
establishing the value of the market factor to reflect the broad range
of business, financial and market forces that also affect the fair
market value of the Class A common stock. In 2001, the board of
directors approved the modifications of the definitions of the "E" or
the stockholders' equity component and "P" or the earnings component
of the formula. Before approving these changes to the formula, the
board of directors consulted with HLHZ and then determined that these
definitional changes were appropriate and that our valuation process
would continue to generate a fair market value of the Class A common
stock within a broad range of financial criteria.

 Stock Price Table

        The following table sets forth information concerning the
stock price for the Class A common stock, the applicable price for the
Class B common stock and each of the variables contained in the
formula, including the market factor, in effect for the periods
beginning on the dates indicated. The Class A common stock has been
rounded to the nearest penny. There can be no assurance that the Class
A common stock or the Class B common stock will in the future provide
returns comparable to historical returns or that the price will not
decline. In fact, the price declined 13.2% during fiscal year
Date
	  	Market
Factor 	  	"E" or
Adjusted
Stockholders'
Equity(1) 	  	"W1"
or Shares
Outstanding(2) 	  	"P"or
Adjusted
Earnings(3) 	  	"W" or
Weighted
Avg. Shares
Outstanding(4) 	  	Price
Per Share
of Class A
Common
Stock 	  	Price
Per Share
of Class B
Common
Stock 	  	Percentage
Price
Change(5) 	 
April 12, 2002 	  	2.90 	  	$ 	2,455,657,000 	  	215,804,158 	  	$
	297,660,000 	  	225,382,561 	  	$ 	33.06 	  	$ 	661.20 	  	0.3 	%
July 12, 2002 	  	2.60 	  	$ 	2,483,464,000 	  	215,331,807 	  	$
	319,724,000 	  	218,864,381 	  	$ 	33.03 	  	$ 	660.60 	  	(0.1 	)%
July 29, 2002 	  	2.10 	  	$ 	2,483,864,000 	  	215,331,807 	  	$
	319,724,000 	  	218,864,381 	  	$ 	28.90 	  	$ 	578.00 	  	(12.5 	)%
October 11, 2002 	  	1.90 	  	$ 	2,394,108,000 	  	209,578,812 	  	$
	335,148,000 	  	213,397,043 	  	$ 	28.31 	  	$ 	566.20 	  	(2.0 	)%
January 10, 2003 	  	1.90 	  	$ 	2,072,146,000 	  	195,447,055 	  	$
	346,570,000 	  	207,048,972 	  	$ 	28.60 	  	$ 	572.00 	  	1.0 	%
April 11, 2003 	  	1.90 	  	$ 	2,006,774,000 	  	190,974,359 	  	$
	349,930,000 	  	203,232,903 	  	$ 	29.02 	  	$ 	580.40 	  	1.5 	%
July 11, 2003 	  	1.90 	  	$ 	2,102,168,000 	  	192,229,993 	  	$
	358,704,000 	  	197,175,777 	  	$ 	30.50 	  	$ 	610.00 	  	5.1 	%
October 10, 2003 	  	1.90 	  	$ 	2,133,849,000 	  	190,791,535 	  	$
	368,075,000 	  	192,079,951 	  	$ 	31.79 	  	$ 	635.80 	  	4.2 	%
January 9, 2004 	  	2.20 	  	$ 	2,196,927,000 	  	190,348,029 	  	$
	380,148,000 	  	189,499,866 	  	$ 	36.52 	  	$ 	730.40 	  	14.9 	%

(1)
    "E" is our stockholders' equity at the end of the fiscal quarter
immediately preceding the date on which a price determination is to
occur, adjusted to reflect the value of publicly traded equity
securities classified as investments in marketable securities, as well
as the profit or loss impact, if any, on stockholders' equity arising
from investment activities, non-recurring gains or losses on sales of
business units, subsidiary common stock, or similar transactions
closed, as of the valuation date.

(2)
    "W1" is the number of outstanding common shares and common share
equivalents at the end of the fiscal quarter immediately preceding the
date on which a price determination is to occur.

(3)
    "P" is our operating income for the four fiscal quarters
immediately preceding the price determination, net of taxes, excluding
investment activities, losses on impaired intangible assets,
non-recurring gains or losses on sales of business units, subsidiary
common stock and similar items, and including our equity in the income
or loss of unconsolidated affiliates and the minority interest in
income or loss of consolidated subsidiaries. The aggregate amount of
these items on a pre-tax basis is disclosed as "segment operating
income" in our consolidated quarterly and annual financial statements
filed with the SEC. The operations of our INTESA joint venture have
been classified as discontinued operations as of January 31, 2003 and
are no longer reflected in operating income. Beginning with the April
11, 2003 stock price determination, the "P" variable of the formula no
longer includes the operations of INTESA.

(4)
    "W" is the weighted average number of outstanding common shares
and common share equivalents for the four fiscal quarters immediately
preceding the price determination, as used by us in computing diluted
earnings per share.

(5)
    Value shown represents the percentage change in the price per
share of Class A common stock from the prior valuation.


Thanks for reading this far...

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Request for Question Clarification by pafalafa-ga on 20 Oct 2004 14:33 PDT

Thanks for clarifying...even if it was perhaps the longest
clarification I've ever seen....!

Nothing comes up so far that is anywhere as specific as SAIC.  The
closest I've come is this:

-----
Formula values. The formula price of the Class D shares is based on
the book value of Kiewit Diversified Group Inc. and its subsidiaries,
plus one-half of the book value, on a stand-alone basis, of the parent
company, Peter Kiewit Sons', Inc. The formula price of the Class C
shares is based on the book value of Kiewit Construction Group Inc.
and its subsidiaries, plus one-half of the book value of the
unconsolidated parent company. A significant element of the Class C
formula price is the subtraction of the book value of property, plant,
and equipment used in construction activities ($106 million in 1996).

Conversion. Under the Company's Certificate of Incorporation, Class C
shares are convertible into Class D shares at the end of each year.
Between October 15 and December 15 of each year a Class C stockholder
may elect to convert some or all of his or her shares. Conversion
occurs on the following January 1. The conversion ratio is the
relative formula prices of Class C and Class D shares determined as of
the last Saturday in December, i.e. the last day in the Company's
fiscal year. Class D shares may be converted into Class C shares only
as part of an annual offering of Class C shares to employees. Instead
of purchasing the offered shares for cash, an employee owning Class D
shares may convert such shares into Class C shares at the applicable
conversion ratio.
-----


I'll keep looking, but in the mean time, let me know if the above is
of any value to you, or if you're looking only for formulas as
detailed as that provided by SAIC.

Thanks.

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Clarification of Question by reskone1-ga on 21 Oct 2004 10:30 PDT

Hi Pafalafa.

Sorry, but I really need a formula that is more specific (as with
SAIC).  The info you provided is appreciated, but is about ten years
old.  Also the 10K shows how the Formula Price is vastly different
from the Stock Price.  See below...

"The formula value and stock price for the Class B, C, and D Stock at
the end of 1993 and 1994 was as follows (in millions, except per share
data):


     1993                                 Class B/C    Class D
     Formula Value                        $ 391        $1,191
     Stock Price per share                   22.35         59.40

     1994
     Formula Value                        $ 411        $1,231
    Stock Price per share                   25.55         60.25"

It appears that this company Peter Kiewit Sons'no longer uses this
formula or files frequent reports with the SEC (as SAIC does).

I need an example of where the Formula Price is the actual Stock Price
(as with SAIC).  (I'm not sure what Kiewit Sons is using for formula
value for, but it is not to set the stock price.)

While I prefer to find a forumua that is posted with the SEC, I will
consider a formula that is actually used by a private company and can
be collaborated.  (In this case, the company must have annual revenues
or assets of at least $50,000,000.)

Thanks for your continued effort.

Mike