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Equity Valuation Models Chapter 18 Models of Equity Valuation Basic Types of Models Balance Sheet Models Dividend Discount Models Price/Earning Ratios Estimating Growth Rates and Opportunities 118­2 Intrinsic Value and Market Price Intrinsic Value Self assigned Value Variety of models are used for estimation Market Price Consensus value of all potential traders Trading Signal IV > MP Buy IV < MP Sell or Short Sell IV = MP Hold or Fairly Priced 118­3 Dividend Discount Models: General Model Vo t 1 Dt (1 k)t V0 = Value of Stock Dt = Dividend k = required return 118­4 No Growth Model Vo D k Stocks that have earnings and dividends that are expected to remain constant. Preferred Stock 118­5 ... - tailieumienphi.vn
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