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Cited by 326

The DOI matches its Crossref record; 50 of the 50 references it cites were found in a registry or an index.

Valuation Approaches and Metrics: A Survey of the Theory and Evidence

Open access
Damodaran, Aswath·2007·Foundations and Trends® in Finance
DOI 10.1561/0500000013
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Abstract

Valuation lies at the heart of much of what we do in finance, whether it is the study of market efficiency and questions about corporate governance or the comparison of different investment decision rules in capital budgeting. In this paper, we consider the theory and evidence on valuation approaches. We begin by surveying the literature on discounted cash flow valuation models, ranging from the first mentions of the dividend discount model to value stocks to the use of excess return models in more recent years. In the second part of the paper, we examine relative valuation models and, in particular, the use of multiples and comparables in valuation and evaluate whether relative valuation models yield more or less precise estimates of value than discounted cash flow models. In the final part of the paper, we set the stage for further research in valuation by noting the estimation challenges we face as companies globalize and become exposed to risk in multiple countries.

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Metadata

Authors
Damodaran, A.
Venue
Foundations and Trends® in Finance
Publisher
Emerald
Published
2007-04-11
Volume
1
Issue
8
Pages
693-784
ISSN
  • 1567-2395 (ISSN-L)
  • 1567-2409
DOI
10.1561/0500000013
OpenAlex
W2046141847
Cited by
326
References
50
FWCI
34.41
Type
journal article
Language
en
Open access
green

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