1. Két hozamértékmodell árfolyam-magyarázó képességének összevetése nemzetközi nagyvállalatoknál.
- Author
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EDINA, CZIGLERNÉ ERB and ANDRÁS, TAKÁCS
- Subjects
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DISCOUNTED cash flow , *CASH flow , *INDEPENDENT variables , *INVESTORS , *TWENTIETH century - Abstract
The theoretical background of RIM (residual income model) has been present in the literature since the first half of the 20th century, however, in terms of practical applications, it could never become a real alternative of the DCF (discounted cash flow) model. In the last decades, RIM has gained attention again owing to the international studies investigating its explanatory power on stock prices compared to DCF, but the empirical results were mixed. This study aims to extend the literature with further empirical findings, which may support the better understanding of the usefulness of RIM and the DCF model, and help investors increase the efficiency of stock valuations. Based on an owncollected panel consisting of 34 global companies' data for the 2013-2019 period, the authors show that RIM can outperform the traditional DCF model, but its explanatory power lags behind that of DCF's smoothed version that handles the distortions originating from the timing differences between earnings and cash flows. It is also found that application of a growth period in cash flow forecasts is questionable as the authors' independent variables computed with the perpetual annuity model perform much better in explaining stock prices than the independent variables determined based on the two-stage model containing an explicit growth period. [ABSTRACT FROM AUTHOR]
- Published
- 2020
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