{"id":717,"date":"2026-03-17T11:30:01","date_gmt":"2026-03-17T11:30:01","guid":{"rendered":"https:\/\/www.athla.co.uk\/insights\/?p=717"},"modified":"2026-03-17T09:35:16","modified_gmt":"2026-03-17T09:35:16","slug":"the-effect-of-global-market-change-on-valuations","status":"publish","type":"post","link":"https:\/\/www.athla.co.uk\/insights\/the-effect-of-global-market-change-on-valuations\/","title":{"rendered":"The effect of global market change on valuations"},"content":{"rendered":"<p data-pm-slice=\"1 1 []\">Oil prices have risen steeply since the start of the US-Iranian conflict; how can Athla account for market change in valuations?<!--more--><\/p>\n<p data-pm-slice=\"1 1 []\">Global market changes affect all of us in a myriad of ways. Today we are looking specifically at how we can account for the effect in valuations to ensure that we give our clients a robust valuation that has considered all the relevant factors.<\/p>\n<p>Oil prices have continued to rise since the start of the conflict and <a href=\"https:\/\/www.ft.com\/content\/be122b17-e667-478d-be19-89d605e978ea\">Qatar have warned that it will take \u2018weeks to months\u2019 to return to a normal cycle of deliveries<\/a>. It\u2019s clear to us that this is going to have a major impact on British businesses, both directly and indirectly. News coverage has begun to acknowledge this \u2013 see the latest FT article on <a href=\"https:\/\/www.ft.com\/content\/7145e265-a1ce-4e5f-a0ae-7cb8b9bec168\">How the Iran War will change global business<\/a>.<\/p>\n<p>With rising geopolitical tensions and increasing energy prices, we are reassessing the assumptions that underpin a valuation. Ensuring that these assumptions remain robust is increasingly important for boards, investors, stakeholders and HMRC-compliant share scheme valuations.<\/p>\n<p><strong>And how are we doing this you ask?<\/strong><\/p>\n<ul>\n<li>Reassessing weighted average cost of capital (\u201cWACC\u201d)<\/li>\n<li>Updating market risk premiums and beta estimates<\/li>\n<li>Running valuation sensitivities to cost of capital changes.<\/li>\n<\/ul>\n<p>All of this means that you can trust Athla to have considered geopolitical impact on valuations.<\/p>\n<p>But in practice what does that actually mean? Well, sometimes the change is systemic, like <a href=\"https:\/\/www.gpsi-intl.com\/blog\/reshoring-why-is-it-being-considered-today-and-what-does-it-involve-2\/#what-is-reshoring\">reshoring<\/a> of commercial capabilities and materials, and has an effect on most businesses\u2019 operations. We\u2019re comfortable and used to adjusting for systemic changes.<\/p>\n<p>So what happens when we value a business that is highly affected by a specific event? We analyse the event as a company-specific factor as well as acknowledging general geopolitical impact.<\/p>\n<p>For example, let\u2019s cast our minds back to the blocking of the Suez Canal and the reaction within the shipping industry (there is a direct correlation with the issues in the Strait of Hormuz today). A study published in 2025 stated that Maersk Line lost <a href=\"https:\/\/www.hellenicshippingnews.com\/the-cost-of-the-suez-canal-blockage-2\/\">\u201cnearly $89m\u201d<\/a> and <a href=\"https:\/\/www.reuters.com\/world\/middle-east\/maersk-resume-suez-canal-sailings-mecl-service-2026-01-15\/\">have only just begun to use the Suez Canal again since January 2026<\/a>. If we were valuing a similar shipping company, we might use the change in value of Maersk Line over this period as a proxy for the impact of a similar blockage to our theoretical company\u2019s shipping.<\/p>\n<p>Otherwise, we use a combination of our comprehensive data request form, desk research, years of experience from our CEO and careful conversations with the company to determine whether an adjustment is needed.<\/p>\n<p>It\u2019s important to note that we cannot have perfect knowledge of every industry, but we are very experienced at asking the right questions to identify where a factor has become vitally significant to the valuation.<\/p>\n<p>If you have a client who is feeling the impact of current geopolitics and needs a sensitive hand to their company\u2019s valuation, please do get in touch.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Oil prices have risen steeply since the start of the US-Iranian conflict; how can Athla account for market change in valuations?<\/p>\n","protected":false},"author":2,"featured_media":718,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-717","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/posts\/717","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/comments?post=717"}],"version-history":[{"count":2,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/posts\/717\/revisions"}],"predecessor-version":[{"id":720,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/posts\/717\/revisions\/720"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/media\/718"}],"wp:attachment":[{"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/media?parent=717"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/categories?post=717"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.athla.co.uk\/insights\/wp-json\/wp\/v2\/tags?post=717"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}