Title: Relative Valuation: Issues and General Framework
Abstract: A general overview of equity relative valuation, analyzing its assumptions, strengths and weaknesses, is essential. Equity valuation is a main application of finance and accounting theory. The theoretical emphasis usually focuses on discounted cash flow (DCF) and other equivalent models which are grouped as absolute valuation methods to equity evaluation. These models come up with some drawbacks when practitioners try to implement them. Market-based valuations based on multiples, on the other hand, present many advantages but we must be aware of their limitations too.
Publication Year: 2016
Publication Date: 2016-01-01
Language: en
Type: book-chapter
Indexed In: ['crossref']
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