How you can predict future evolution of value of shares
Could we suppose that, as we cannot predict the future evolution of the value of shares, a good estimation would be to consider this constant during the next five years?
Expert
Such affirmation is an error. The relation among the value of the shares of various years is: Et = Et-1 (1+Ket) – CFact. The shares value is constant (Et = Et-1) only when CFact = Et-1 Ket. It happens in non-growing perpetuities.
The often known as "cash flow" that is net income plus depreciation, is a flow of cash, but is this a flow to the company or to the shareholders?
Who explained put–call parity?
Could we explain that the shares’ value is intangible?
Is the relation in between book value of shares or capitalization a good guide to investments?
What repercussions do variations in the oil price have on the value of a company?
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