EconStor >
Zentrum für Europäische Wirtschaftsforschung (ZEW), Mannheim >
ZEW Discussion Papers >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/24026
  
Title:Option-Style Multi-Factor Comparable Company Valuation for Practical Use PDF Logo
Authors:Meitner, Matthias
Issue Date:2003
Series/Report no.:ZEW Discussion Papers 03-76
Abstract:Classical single-factor comparable company valuation (CCV) like e.g. valuation using the price-earnings ratio is associated with several shortcomings. The two most important are the non-applicability of negative values in the basis of reference and the high requirements to the qualitative characteristics of comparable companies. This paper develops a multi-factor CCV model based on substance and performance related accounting attributes that largely overcomes these drawbacks. Additionally, the model allows to depict expected future earnings development economically sounder than single-factor models. Furthermore, by accounting for management?s option to adapt firm assets differently or to liquidate the company the model can conclusively assign positive stock prices to currently negatively performing companies.
Subjects:Valuation
Multiples
Real Options
JEL:M41
G12
M21
G31
Document Type:Working Paper
Appears in Collections:ZEW Discussion Papers
Publikationen von Forscherinnen und Forschern des ZEW

Files in This Item:
File Description SizeFormat
dp0376.pdf424.15 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/24026

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.