Session 11 - Equity Valuation - Industry and Company Analysis

Question 1

Value with PVGO Consideration

Answer 1

= (no growth earnings level)/(required return) + PVGO

Question 2

Justified Leading P/E

Answer 2

(dividend payout ratio) / (r - g)

Question 3

Justified Trailing P/E

Answer 3

(dividend payout ratio)(1+g) / (r - g)

Question 4

Terminal Value (Year x)

Answer 4

(Div x +1) / (r - g)

Question 5

H-Model Valuation

Answer 5

[(Div)(1+LT g)]/(r - LT g) + [(Div)(H)(ST g - LT g)]/ (r - LT g)