Module 32.2 LOS 32.d: Fundamental determinants of Residual Income
Using a single-stage residual income model, we can highlight the fundamental drivers of residual income. We can equate B0 to …
equity
Module 31.1 LOS 31.c: Leading and Trailing P/E ratio
The P/E ratio is the most widely used price multiple in the investment community. There are reasons why it is …
Module 33.2 LOS 33.e: Normalizing earnings for Private Companies
When valuing private companies, normalized earnings are appropriate. However, in this context, normalized earnings refer the earnings of the company …
Module 31.4 LOS 31.n: Enterprise Value Calculation and EV ratios
Enterprise value is the total value of a company: EV = market value of common stock + market value of …
Module 27.1 – Equity Pricing Models (Ibbotsen-Chen, CAPM, Fama-French), Equity Risk Premiums & Beta Adjustments
Investors generally require a risk-premium in excess of the risk-free rate to justify holding equity securities. The risk premium in …