Sales: Sales: Support: Support:
Academic writing services  
Custom written essay Book report Research paper Dissertation Resume and CV Editing and proofreading  
main menu
By ordering custom paper you get
  • 24/7 Support
  • Over 100 professional US Writers
  • 300 words per page
  • Flexible discount system
  • FREE revision (within 2 days)
  • Anti-Plagiarism Software Check
we accept
sample essays
Accounting Essays
Admission Essays
Analysis Essays
Art Essays
Biography Essays
Biology Essays
Book Review Essays
Business Essays
Case Studies Essays
Cause and Effect Essays
Character Analysis Essays
Communication Essays
Communication and Media Essays
Compute Technologies Essays
Consideration Essays
Controversial Essays
Description Essays
Economics Essays
Education Essays
Evaluation Essays
Explanation Essays
History Essays
Job Essays
Law Essays
Management Essays
Medicine Essays
Music Essays
Personal Essays
Personal Experience Essays
Persuasive Essays
Persuasive Speech Essays
Philosophy Essays
Political science Essays
Politics Essays
Proposal Essays
Psychology Essays
Reflective Essays
Religion Essays
Research Essays
Response Essays
School Essays
Science Essays
Sociology Essays
Technology Essays
World Literature Essays
Version 2 Valuation essay
← International Issues and DiscriminationGoogle Takes on the World →

Version 2 Valuation. Custom Version 2 Valuation Essay Writing Service || Version 2 Valuation Essay samples, help

Live Chat
The manner in which companies are valued by analyst and the way managers can be affected by psychological, heuristics, and framing factors are discussed by Shefrin in Chapter two. This paper will concentrate on what is being accomplished by Shefrin, specifically in chapter two on valuation. Thus, this paper aims at preparing and submitting the lecture notes that are required, together with the necessary examples and computations. Furthermore, the numerical examples depicted in the chapter will be encompassed in the presentation, so as to enable attendees better comprehend the points that are being portrayed.Typically, valuation concentrates on the formula PV=C/ (-g + r) whereby, C refers to first-payment; g is the growth rate of future payments; and r is the discount rate. Valuation is of necessity because it will help attendees to comprehend the following: understand why a number of monetary executives/analysts heavily depend on the valuation heuristics other than textbook techniques, which accentuate intrinsic value; depict the major heuristics that are mainly used by analyst/monetary executives to compute values; spot the prejudices that are likely to occur due to the usage of valuation heuristics; and spot prejudices that are likely to occur due to the usage of textbook techniques that are traditional, and which accentuate intrinsic value.Basically, the majority of analyst as well as monetary executives heavily depend on valuation heuristics other than textbook techniques. This is due to the fact that textbook techniques are on the basis of calculating the intrinsic value. As a matter of fact, it is easier to use heuristics because they require fewer variables. Nonetheless, simpler formulas are involved in them and to that effect, they an instinctive appeal. On the other hand, textbook techniques require more details, are less instinctive, and involve formulas that are more complicated (Montier, 2002).  
Order now
Also, the FEI (financial executives international) is mainly published by the monetary executive and thus rely on valuation heuristic techniques, such as: price to sales; P/E; and PEG. These techniques can either correspond to textbook book techniques, such as non-DCF (discounted cash flow) heuristics, or the DFC approach. Idyllically, the major heuristics that monetary executives/security analyst employ in computing values are:a)      P/E HeuristicThis is a valuation approach that is on the basis of getting the product of an earnings-forecast and the P/E ratio. The P0/E1 is a forward P/E that denotes the current price and the earnings-per-share for the subsequent year. This heuristic is normally relied on by Security analyst. To get the valuation identity, we apply the following P0=P0/E1XE1. To estimate, the price, P1, the following relationship should be applied: P1 =P1/E2XE2b)      PEG Heuristic
Type of assignment Title of your paper Writer level Pages
Timeframe Spacing Currency Total price
This is a valuation approach that is on the basis of getting the product of earnings-forecast PEG ratio, and the predicted rate of growth. Supremely, the formula used to compute the valuation identity is P0=E X G X PEG, whereby G is 100 times the rate of growth. In this kind of heuristic, we can employ the PEG heuristic to predict Price, P1. To do this, one has to predict the earnings-per-share, PEG ratio, and the rate of growth that will be applicable to the predicted period.c)      Price to Sales HeuristicThis is a valuation approach that is on the basis of getting the product of the sales forecast and the ratio of price to sales. The structure of this heuristic is similar to that of P/E heuristic, but with exception of substituting future sales with future earnings. To compute the valuation density, the formula that is used is P0=P0/S1 X S1, whereby S represents sales.Components in Meeker's Target-Price Critique of eBayTable source: Pitz Brian and Meeker Mary, Report Analyst on eBay, 2003As illustrated in the table above, a CDF approach was used by Meeker Mary, who then applied it to the free cash-flows of eBay. For instance, this calculation is closer to the textbook technique and it the only one that is used in deriving the target-price, particularly the intrinsic value. In this circumstance, the perpetuity formula is usually effective. By using valuation heuristics, a number of biases are likely to occur. This is also true when it comes to using textbook techniques that accentuate intrinsic value (Petty, & Martin, 2000).Ideally, the majority of analysts normally favor the P/E heuristic approach. From the above table the P/E target price ranged from 74 to 111. The estimate for the base was 84, a value below the 2003 price and thus it is likely to generate a negative return. Superlatively, a more negative value is generated by the PEG heuristic and thus, it is deemed to be worse. The DCF approach computation is the only method that is capable of measuring the intrinsic value.In conclusion, the manner in which information is described (i.e. framing) is an aspect that is vital. For instance, Meeker Mary framed a critique of the free cash-flow in terms of free cash-flow sources, but not the applications of the free cash-flow. In view of the fact that cash flow applications are vital in valuation analysis, the cash flow applications are not salient in Meeker's critique. Thus, we can say that the main cause of valuation bias is misframing. However, bias can also be caused by the growth opportunities.

Version 2 Valuation. Custom Version 2 Valuation Essay Writing Service || Version 2 Valuation Essay samples, help

Order Now
Order nowhesitating

Related essays

  1. Google Takes on the World
  2. Intellectual Capital: Corporate Culture
  3. International Issues and Discrimination
  4. Corporate Financial Reporting and Taxation

order now

Order now
why choose us
96% of satisfied returning customers
24/7 customer support
A wide range of services
Up-to-date sources
100% privacy guaranteed
MA/PhD writers
Custom written papers only
Free plagiarism report
Free revision (within 2 days)
Free extras by your request
Direct communication with a writer
Are your writers qualified for the custom writing?
How quick can my order be accomplished?
Is it legal to buy custom essays, term papers or book reports from your company?
Are essays offered by your company truly custom-written?
Is it safe to buy from
How secure is the payment system of your company?
Can I submit custom essays or term papers done by your company as my own?
How can I contact your company if I've got problems with my ordered paper?

Finally, I've found the real custom writing service . My grades are saying "Thank you, it's been a pleasure to work with you."

Jamal, South Africa

I can't believe you finished my essay under such a short deadline! You saved me from a disaster once again. You guys deliver exactly what you promise. I'll be back. That's for sure!

William H , Kansas, US

contact us
Toll free for US & Canada only. International callers are charged for outgoing calls.

Our phone numbers: provides custom term paper writing/rewriting services inclusive of research material for assistance purposes only. The term papers should be used with proper reference and are not meant to replace actual assignments.

Get 15% off your first custom essay order

Order now

from $12.99/PAGE