ARTÍCULO
TITULO

Stock Prices and Implied Abnormal Earnings Growth

Hafiz Imtiaz AHMAD    
Pascal ALPHONSE    
Michel LEVASSEUR    

Resumen

In terms of corporate valuation, the frequently used heuristics are Price Earnings or Price Earnings to Growth ratios. The development of a valuation model of type Abnormal Earnings Growth Model including modeling of expected rents evolution, conditions compatible with perfect competition, allows us to propose a testable relationship between market value of share, expected earnings per share in a year, its rate of growth in short term and a set of accounting variables composing a synthetic indicator of growth of company. Our results show that (1) expected increase in earnings per share are significantly associated with stock prices for developed countries, (2) but, the persistence of its effects is limited for emerging countries, (3) when the dynamics of growth are more complex, inclusion of synthetic variable of can make a significant correction term (4) and the implied cost of capital is significantly higher for emerging countries than for developed countries. Keywords: equity valuation; abnormal earnings; Emerging markets JEL Classifications: G12; G14; M41

 Artículos similares

       
 
Ratna Nadia Sari, Nunung Nurhasanah, Sonny Hersona     Pág. 1148 - 1161
This study aims to determine the effect of Return On Assets (ROA), Debt to Equity Ratio (DER) and Debt to Asset Ratio (DAR) on stock prices. With a population of food and beverage sub-sector manufacturing companies listed on the Indonesia Stock Exchange ... ver más

 
Lamsihar Rajagukguk, Nathania Mauriska Walani, Megawati Silaban     Pág. 1528 - 1537
The purpose of this research is to find out how the influence of Liquidity, Solvency, and Profitability either partially or simultaneously on stock prices. Each data used is official data from the annual financial statements taken from financial statemen... ver más

 
Benny R.M Nainggolan, Tiara Rufita Hutapea, Evi Pardede, Rusnia Winata Sianturi, Cindy Veronika     Pág. 954 - 961
The research that test the effect of Fixed Asset Turnover, Return On Asset, Current Ratio, and Total Asset Turnover on stock prices in the Basic Industry and Chemicals Sector was conducted either simultaneously or partially used non-probability sampling ... ver más

 
Ismi Fajriati, M. Wahyudin Zarkasyi     Pág. 969 - 980
This research aims to identify and examine the relationship between liquidity, profitability, and leverage with stock prices in food and beverage sub-sector companies listed on the Indonesia Stock Exchange for the period 2016-2020. Determination of the s... ver más

 
Wisnu Lesmono, Nunung Nurhasanah, Didit Supriyadi     Pág. 1074 - 1086
The stock market price is a marker dimension of the company's results, namely how far management has managed to manage the company on behalf of shareholders. Evaluation of stock prices can be done by several methods, in certain ways the calculation of st... ver más