Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

AN EMERGING MARKET PERSPECTIVE ON KEY VALUE DRIVERS IN THE VALUATION OF CROSS-BORDER TRANSACTIONS INTO SOUTH AFRICA

AN EMERGING MARKET PERSPECTIVE ON KEY VALUE DRIVERS IN THE VALUATION OF CROSS-BORDER TRANSACTIONS... This paper investigates the valuation performance of 16 individual value drivers, from five different value driver categories, in relation to the South African equity market for the period 2001–2010. The research results revealed, among other findings, that headline earnings is by far the most accurate value driver and that, contrary to popular belief, earnings before interest, tax, depreciation and amortization and earnings before interest and tax are only fourth and fifth best alternatives. The evidence also suggests that, when employing multiples to perform equity valuations, a careful selection of value drivers could increase valuation accuracy by as much as 50.03%. JEL codes: G11; G12; G32; O16 Keywords: equity valuation; JSE; multiples; valuation accuracy; value drivers http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Economics, Management, and Financial Markets Addleton Academic Publishers

AN EMERGING MARKET PERSPECTIVE ON KEY VALUE DRIVERS IN THE VALUATION OF CROSS-BORDER TRANSACTIONS INTO SOUTH AFRICA

Economics, Management, and Financial Markets , Volume 9 (4): 20 – Jan 1, 2014

Loading next page...
 
/lp/addleton-academic-publishers/an-emerging-market-perspective-on-key-value-drivers-in-the-valuation-2KHmTvUovp
Publisher
Addleton Academic Publishers
Copyright
© 2009 Addleton Academic Publishers
ISSN
1842-3191
eISSN
1938-212X
Publisher site
See Article on Publisher Site

Abstract

This paper investigates the valuation performance of 16 individual value drivers, from five different value driver categories, in relation to the South African equity market for the period 2001–2010. The research results revealed, among other findings, that headline earnings is by far the most accurate value driver and that, contrary to popular belief, earnings before interest, tax, depreciation and amortization and earnings before interest and tax are only fourth and fifth best alternatives. The evidence also suggests that, when employing multiples to perform equity valuations, a careful selection of value drivers could increase valuation accuracy by as much as 50.03%. JEL codes: G11; G12; G32; O16 Keywords: equity valuation; JSE; multiples; valuation accuracy; value drivers

Journal

Economics, Management, and Financial MarketsAddleton Academic Publishers

Published: Jan 1, 2014

There are no references for this article.