Stock Valuation Techniques research


Introduction
 The organization traded as a public limited company. It operates mainly on the retail offering industry. The organization was formed on April 1990. The founders of the organization were Steve Smith and Dave Dodd. The headquarters of the organization was in England. The organization operates in 450 retail stores. The products for the organization comprise of the electronic, DIY, Consumer goods and groceries. The organization has posted revenue of 642 million pounds, (Thomas, 2011). The operating income for the organization was 16 million. The firm posted a profit of 11.8 million pounds. The owners for the organization are Warburg Pinks, (Hobbs, 2011). The employees of the organization are 10020 people. The firm has a plan to enter into the London stock exchange. This editorial will offer the reasons for the entry into the stock exchange and assess the critical methods that can be used in the valuation.  
1.1. Scope
 The discussion section will identify the different reasons for the organization to get listed in the London stock exchange. The discussion section will analyze the different valuation methods that could be implemented by the management. The analysis section will offer a recommendation on the best valuation method.
1.2. Purpose
 The endeavour of the investigation is to offer insight on the need for the company to be listed. The editorial offers information on the best valuation techniques for the assessment.
1.3. Thesis
DDM is the best valuation method.
Discussion
2.1. Reasons for stock market listing
 The reasons for the firm to go for the market listing in the London stock exchange are the following.  The first reason is the access of the capital to fund growth.  The public placement of the company in the market listing increased the attractiveness of the firm to attract the management to upgrade the production facilities and acquisitive expansion.  The management will be able to obtain the timeless pool of capital and boost for the investment credibility in the businesses, (Luke, 2011).
 The second reason is to offer the creation of liquidity form the potential exit for the current owners.  The listing of the market in the stock exchange increases the chances for the creation of liquidity and provision of opportunities that offer the sale of shares with the minimal transaction costs, (Hobbs, 2011).  The exit of the owners assures the clients, suppliers and partners of the different quality issues that they were able to identify for the organizational capabilities.  The aspect of due diligence is provided to the firm through the assessment of the financial position.
The third reason is for the maximization of the value of the company. The market listing increases the identification of the business and offers confidence in its liquidity.  The identification of the liquidity provision assures the success of the organization in dealing with the divergent issues that will generate finances for the organization, (Eduard, 2011).  The improvement in the debt finances will be based on the financial reporting for the company that will be listed for the recognition of the stock exchanges, (Thomas, 2011).  The different financial institutions will fight to identify the divergence of the recognised stock exchange that that originates from the reliable and desirable partners. The corporate governance and transparency focuses on the assessment of the additional factors of confidence for the suppliers and banks.  
2.2. Methods for Valuation
2.2.1. Dividend discount model
 The Dividend discount model assesses the intrinsic value of stocks that represent the present value of the income streams.  The method assesses the estimate for the value of the share of stock through the discounting of the different expected future dividend payment.  The fundamental analysis for the evaluation is based on the analysis of the company’s accounting statement and other economic and financial information, (Alfonso, 2011).  The assessment allows the assessment of the firm’s economic value for the company’s stock.
             The basic idea is for the identification of the overvalued and undervalued stocks.  The practice looks at the stocks that can be correctly priced for the reasons that are not immediately apparent to the different analysis.  The Dividend discount model assumes that the dividend will grow at the constant rate forever, (Eduard, 2011).  The growth rate for the dividends is estimated at different approaches.  The fist approach is applying the historical rate for the company as the average growth rate, (Luke, 2011). The growth rate is identified through the identification of the mean for the median of the average growth rate.  The management can use the sustainable growth rate for the assessment of the approaches.

Comments

Post a Comment

Popular posts from this blog

research

The corporate culture has been seen to be an incredible issue that forces the companies to have long-term success in the different issues that they perform.  The strategy that is at a disparity with the organization’s culture makes the organization to be unsuccessful.  The organization’s culture is considered complex and ever changing, (Alice, 2011). The management uses strategy to enable the correction of the corporate governance. This analysis will assess the different relationships between strategy and culture.  The study will assess the different models that allow the formation of the recommendation.  The first relationship for the culture and strategy is as followed. The strategy offers the direction and focus for the culture, (Meier, 2011). The culture, on the other hand, offers the emotions or organic habitat that allows the company to die or live, (Arnold, 2011).  The management of different organizations is required to offer the direction and vision ...
Read more

fastessayz.com Planning Dissertation Research in Business

Image
 Different theories have posed the question of the impact of job satisfaction on employee's performance.  The job satisfaction has been based as the collection of feelings and beliefs of people for the current jobs. The job satisfaction allows the assessment of the positive feeling for the job resulting from the evaluation of the characteristics.  The purpose of the research will be on the identification of the impact of organizational leaders for the contribution of the workers’ well-being. The research will offer different suggestions or recommendations of controlling the state of employee’s satisfaction.  The research will identify the numerous theories explaining the job satisfaction. The first theory is on content.  The content theories suggest the job satisfaction to occur when one need focuses on the self-actualization placed on the individual’s job. Abraham Maslow explains the need of the employees to reach self actualization.  The second theo...
Read more

LIHAO Herb Spice Weed Tobacco Grinder review

Image
*Introduction Many herbs users end up searching for perfection as they grind their weed. I personally got the grinder since I loved to collect unique items. Stylish but elegant grinders offer a unique sense of class and self worth as they grind the weed into small pieces. In the past grinders wee not very effective and were considered as banned. With the removal of weed bans, more of people are seeking stylish but yet again classic LIHAO Herb Spice Weed Tobacco Grinders. Today, seek out a detailed but exquisite weed grinder for your social visits and social moments. The grinder came with some features that I could not fail to mention. *Features 1: stylish appearance In my first purchase of the grinder, I thought to myself how a well-decorated piece of art could turn out to be a weed grinder.  I had to ask the teller if the grinders were genuine grinders or just dummies offered to display how a grinder should look. The teller explained to me that the LIHAO Herb Spice W...
Read more