The DOI matches its Crossref record; 1 of the 1 references it cites were found in a registry or an index.
Equity Valuation Using Multiples
Open accessAbstract
We examine the valuation performance of a comprehensive list of value drivers and find that multiples derived from forward earnings explain stock prices remarkably well: pricing errors are within 15 percent of stock prices for about half our sample. In terms of relative performance, the following general rankings are observed consistently each year: forward earnings measures are followed by historical earnings measures, cash flow measures and book value of equity are tied for third, and sales performs the worst. Curiously, performance declines when we consider more complex measures of intrinsic value based on short‐cut residual income models. Contrary to the popular view that different industries have different “best” multiples, these overall rankings are observed consistently for almost all industries examined. Since we require analysts’ earnings and growth forecasts and positive values for all measures, our results may not be representative of the many firm‐years excluded from our sample.
Overview
The claims and statistics of this paper haven’t been checked yet.
Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.
Integrity signals
Registry
Cites
Statistics
Verification
Claims the paper makes
The claims and statistics of this paper haven’t been checked yet.
Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.
Self-check
Percentages, sums and reported differences re-computed from the paper’s own numbers.
The self-check needs the paper’s full text.
Citations
Cites
The Valuation of Cash Flow Forecasts: An Empirical Analysis
KAPLAN, S. N., & RUBACK, R. S. (1995) · The Journal of Finance · doi:10.1111/j.1540-6261.1995.tb04050.x · Cited by 512
Cited by
Costs of Equity and Earnings Attributes
Francis, J., LaFond, R., Olsson, P. M., & Schipper, K. (2004) · The Accounting Review · doi:10.2308/accr.2004.79.4.967 · Cited by 2,377
Business sustainability performance and cost of equity capital
Ng, A. C., & Rezaee, Z. (2015) · Journal of Corporate Finance · doi:10.1016/j.jcorpfin.2015.08.003 · Cited by 650
The Predictive Value of Expenses Excluded from Pro Forma Earnings
Doyle, J. T., Lundholm, R. J., & Soliman, M. T. (2003) · Review of Accounting Studies · doi:10.1023/a:1024472210359 · Cited by 533
Political Uncertainty and IPO Activity: Evidence from U.S. Gubernatorial Elections
Çolak, G., Durnev, A., & Qian, Y. (2017) · Journal of Financial and Quantitative Analysis · doi:10.1017/s0022109017000862 · Cited by 486
Valuation Approaches and Metrics: A Survey of the Theory and Evidence
Damodaran, A. (2007) · Foundations and Trends® in Finance · doi:10.1561/0500000013 · Cited by 326
Metadata
- Authors
- Liu, J., Nissim, D., & Thomas, J.
- Venue
- Journal of Accounting Research
- Publisher
- Wiley
- Published
- 2002-03
- Volume
- 40
- Issue
- 1
- Pages
- 135-172
- ISSN
- 0021-8456 (ISSN-L)
- 1475-679X
- OpenAlex
- W3123014936
- Cited by
- 723
- References
- 1
- FWCI
- 71.78
- Type
- journal article
- Language
- en
- Open access
- green
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
Are you an author, or do you see a problem with this page? Request a review
How to cite
Cite CoChat for the checks on this page, and the paper for its own findings.
- This page
- CoChat. (2026). Citation check: Equity Valuation Using Multiples. https://app.cochat.ai/papers/10.1111/1475-679x.00042
- The paper
- Liu, J., Nissim, D., & Thomas, J. (2002). Equity Valuation Using Multiples. Journal of Accounting Research. https://doi.org/10.1111/1475-679x.00042
Data sources
Bibliographic data: Semantic Scholar, OpenAlex, Crossref.
Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
