Reading 44: Market-Based Valuation: Price and Enterprise Val 2011, face, discounted, interpret, multiple

土豆妮

Session 12: Equity Investments: Valuation Models
Reading 44: Market-Based Valuation: Price and Enterprise Value Multiples

LOS b: Define and interpret a justified price multiple.

 

 

The multiple indicated by applying the discounted cash flow (DCF) model to a firm’s fundamentals is necessarily the:

A) same as the average industry multiple.

B) justified price multiple.

C) result of calculating retention/(required rate of return - growth) for the overall market.

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A justified price multiple is the warranted or intrinsic price multiple. It is the estimated fair value of that multiple. The question is limited to an individual firm and does not necessarily apply to the market or an industry.

[此贴子已经被作者于2011-3-21 11:31:15编辑过]

土豆妮

The warranted or intrinsic price multiple is called the:

A) justified price multiple.

B) multiple implied by the market price.

C) multiple implied by historical growth.

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A justified price multiple is the warranted or intrinsic price multiple. It is the estimated fair value of that multiple.

土豆妮

A justified price multiple is the:

A) multiple implied by historical growth.

B) warranted or intrinsic price multiple.

C) multiple implied by the market price.

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A justified price multiple is the warranted or intrinsic price multiple. It is the estimated fair value of that multiple.