Valuation in Uncertain Times: Key Takeaways for Business Leaders
In April 2026, valuation professionals Michael Lovett, Chase Hoover, and Michael Yi presented 'Valuation in Uncertain Times' at the National Center for Employee Ownership (NCEO) Annual Conference. The session explored how management teams, boards, and valuation professionals can navigate business valuation challenges amid regulatory change, macroeconomic volatility, and rapid technological disruption. This brief thought‑leadership summary highlights the session’s key themes and practical insights for organizations relying on valuations to support informed decision‑making.
Uncertainty Is a Fundamental Part of Valuation
Every valuation is based on assumptions about the future. Whether driven by tariffs, interest rates, inflation, or emerging technologies, uncertainty is unavoidable. The objective of valuation is not to eliminate uncertainty, but to understand it and reflect it reasonably in valuation assumptions. Clear communication between management and the valuation advisor is essential to producing a credible and defensible outcome.
Regulatory and Supply Chain Risk
The presenters discussed a manufacturing business facing uncertainty related to potential tariffs on a key input sourced overseas. While management took steps to mitigate short‑term exposure, the timing and long‑term impact of regulatory action remained unclear. In these situations, appraisers focus on how management has incorporated uncertainty into projections through scenario analysis, sensitivity testing, and consistent treatment of risk across cash flows and discount rates.
Interest Rates and Inflation
Another case highlighted a construction‑related services company impacted by higher interest rates and inflationary pressure. These macro factors directly influence discount rates and costs of capital, while also indirectly affecting demand and margins. Strong valuations present a consistent narrative in which revenue growth, costs, and long‑term expectations align with economic reality.
Technology and AI‑Driven Change
The final example focused on a professional services firm evaluating the potential effects of artificial intelligence and automation. While technology can offer long‑term efficiency gains, uncertainty around implementation and competition requires disciplined forecasting. Valuation credibility is strengthened when assumptions distinguish clearly between measurable near‑term changes and longer‑term strategic aspirations.
A Collaborative Approach to Valuation
Across all scenarios, a consistent message emerged: valuation is a collaborative process. Fair market value is not the same as intrinsic value, but rather reflects how informed market participants would assess risk at a point in time. Valuations are strongest when uncertainty is acknowledged, judgment is clearly documented, and assumptions are aligned with market‑based evidence.