Why is P/E Multiples Approach better than book value per share when it comes to valuing the stocks of a company?

Q: In order to arrive at an intrinsic value for the stock of a company when using the Corporate…

A: Corporate Valuation Model:- This model is also known as the cash flow method, it helps in suggesting…

Q: What is the current dividend policy of Airtasker and why is this the case?

A: Dividends are the payments made by a corporation to its shareholders in return for the investment…

Q: The issue as to whether dividend policy has an effect on share prices raises a question as to…

A: Bird in hand theory of dividend policy says that investors prefer dividend as compared to capital…

Q: Which of the following ways can a firm increase its dividends per share?

A: Firms can increase their dividend per share to their shareholders. When a firm increases its…

Q: Dividend Growth Model Under what two assumptions can we use the dividend growth model presented in…

A: Dividend growth model is an important model that is often used when it comes to determining the fair…

Q: Theory believes that dividend or capital gains has an impact on the price of the stock Select the…

A: Dividend relevance theory:- This theory says that the dividend or capital gain paid by the firms is…

Q: What is the significance of book value per share? How is it computed if: Only one class of share…

A: The company issues various securities to the general public for raising capital. It includes…

Q: How much is the total share capital? What is the issue price of preferred shares? Per share What is…

A: Step 1 Share capital is the part of total stockholder’s equity.

Q: How would you relate information asymmetry to firm’s dividend policy?

A: Information asymmetry refers to when one party has extensive knowledge about a particular subject…

Q: The Discounted Dividend Model and the Corporate Valuation Model are two different ways to determine…

A: a.The Corporate Valuation Model can be used for companies with uneven cashflow growth rates and the…

Q: O Preferred equity is a separate component of WACC. O There is a tax shield on the equity dividends…

A: There is debt used in the capital structure of company debt have advantages of interest tax sheild…

Q: “The market capitalisation of a brand as reflected by their share price on the stock exchange is…

A: The market capitalization is the total current value of the equity in the organization. The market…

Q: Which of the statements is NOT TRUE about the yield of a stock? a) It is comprised of dividend yield…

A: Capital Gain/Loss: It refers to the change in the value of an investment made by an individual or an…

Q: Which of the following are different approaches for estimating the intrinsic value of a common…

A: There are many different types of valuation of stock of company.

Q: how do the upward trend and downward trend of share price(stock price changes) relates to the market…

A: Market Efficiency - A market is efficient when such  market is characterized by perfect and…

Q: )How would you relate information asymmetry to firm's dividend policy?

A: Information asymmetry means when one party has more information than other party. For example, in a…

Q: What is the difference between Par Value of shares and Issue price of shares?

A: Solution: Par value is the minimum fixed price which a company can demand for its share issue.…

Q: Why is the ex-dividend date important to stockholders? If a stock is sold on the ex–dividend date,…

A: The ex-dividend date is important to stockholders as it is the date on/after which a new buyer of…

Q: What factors go into valuing a company's stock

A: This question explains What factors go into valuing a company's stock:

Q: What is meant by the term “distributionpolicy”? How has the mix of dividend payoutsand stock…

A: Introduction: Usually, dividend is nothing but, sharing a portion of profits of the corporation, as…

Q: The market capitalisation of a brand as reflected by their share price on the stock exchange is…

A: The market capitalization of a firm is the entire current value of its equity. A corporation's…

Q: Which of the following is not true for Book Value of a share? * It depends on the balance sheet…

A: Book value of share: The book value is calculated on the basis of the book value of assets and…

Q: Why is P/E Multiples Approach better than book value per share when it comes to valuing a company?

A: PE Approach:- The P/E ratio shows what the market will pay today for a stock in view of its past or…

Q: oes cost

A: Cost of capital : The required return on capital, especially as the expense of developing a new…

Q: When computing diluted earnings per share, which of the following will not be considered in the…

A: Diluted earnings per share are calculated considering the potential common shares or convertible…

Q: Topic: Payout Policy What are the drawback(s) of distributing dividends instead of retained…

A: The dividend policy is a decision in deciding the exchange between paying dividends and retaining…

Q: What is the difference between book value per share of common stock and market value per share? Why…

A: Book Value per share: Book value per share can be calculated as follows: BVPS =   Total Equity −…

Q: Which of the following is true about share split? * It increases the total number of outstanding…

A: Share split break a share into number if pieces reducing the par value of the share.

Q: second priority in the valuation of shares

A: Par value shares is important in determining the value of shares issued for services received and…

Q: Achieving an increased return on common stock by paying dividends on preferred stock at a rate that…

A:

Q: What us earnings per share? What us its significance to the shareholders? How is it computed if:…

A: Earning per share (EPS) is calculated as a company’s profit divided by number of shares outstanding…

Q: How can stock repurchases help a company operate in accordance with the residualdividend model?

A: The Residual Dividend model is a model in which the dividend to be paid to the shareholders is…

Q: How does an increase in price of share of acquiring company affect the value to the target in…

A: The increase in price of the share of acquiring company and its effect on the value of stock of…

Q: Identify the drawbacks of using dividend growth model as part of valuing shares

A: Dividend growth model: Dividends are presumed to grow at a steady rate in perpetuity in this…

Q: What is par value? Select one: a. The price at which a company's stock is sold b. The dollar amount…

A: To arrange the funds for the firm's requirement, firms issue various securities in the market and…

Q: When a company participates in a stock buyback program, it means that the company is buying shares…

A: The Earnings per Share is the net income earned by each share of the company. EPS is computed by…

Q: What effect does the stock split have on Nike’s assets? Its liabilities? Its shareholders’ equity?

A:

Q: Which of the following is true about dividends:   Group of answer choices   Increasing dividends can…

A: Dividends are the payments made to the shareholders or investors of the company. When the company…

Q: which between the two is better for you, the Book Value per Share approach or the P/E (Price…

A: Book value per share approach and Price Earnings (P/E) approach are useful techniques to evaluate…

Q: What does it mean to state that a company’s book value per share of common Q stock is less than its…

A: A share of a company represents the ownership proportion in the company. A holder of common stock is…