Firm Valuation When AI Shapes the Business Model: A Milestone-Based Real-Options Framework for the AI Valuation Uncertainty Problem

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The paper focuses on fundamental corporate valuation and strategic decision-making rather than short-term price prediction or algorithmic trading signals. It is relevant for fundamental analysis of AI stocks but not for high-frequency or quantitative trading strategies.

Implementing the framework requires significant domain expertise to define milestones, conduct AHP pairwise comparisons with expert panels, and calibrate probabilities. It is not a plug-and-play algorithm but a structured analytical protocol.

The framework is described in detail with formulas and a case study. However, the primary data for the case study (Case Firm E12) is confidential and available only upon request under NDA. The AHP scoring relies on expert judgment which is inherently subjective, though the protocol for aggregation is defined.