LOS o: Describe the main types of momentum indicators and their use in valuation.
Q1. Which of the following is a common momentum valuation indicator?
A) Relative strength.
B) Dividend yield (D/P).
C) Price to free cash flow to equity (P/FCFE).
Q2. Which of the following is NOT a common momentum valuation indicator?
A) Earnings surprise.
B) Relative strength.
C) Dividend yield.
Q3. In interpreting the standardized unexpected earnings (SUE) momentum measure, it can be concluded that a given size forecast error is:
A) scaled by the earnings surprise.
B) more meaningful the larger the historical size of forecast errors.
C) more meaningful the smaller the historical size of forecast errors. |