Profitability, Earnings and Book Value in Equity Valuation: A Geometric View and Empirical Evidence

2003 ◽  
Author(s):  
Peter F. Chen ◽  
Guochang Zhang
Keyword(s):  
Empirical Evidence ◽  
Equity Valuation ◽  
Book Value

Combining Earnings and Book Value in Equity Valuation

1998 ◽  
Vol 15 (3) ◽  
pp. 291-324 ◽  
Author(s):  
STEPHEN H. PENMAN
Keyword(s):  
Equity Valuation ◽  
Book Value

An Examination of the Effect of IT Investments on Firm Value: The Case of Y2K-Compliance Costs

2000 ◽  
Vol 14 (2) ◽  
pp. 95-108 ◽  
Author(s):  
Gopal V. Krishnan ◽  
Ram S. Sriram
Keyword(s):  
Information Technology ◽  
Stock Market ◽  
Firm Value ◽  
Market Value ◽  
Annual Reports ◽  
Equity Valuation ◽  
Compliance Costs ◽  
Book Value ◽  
It Investments ◽  
Share Prices

In this study, using the recent Y2-compliance expenditures as an example, we examine whether disclosures relating to investments in information technology (IT) were relevant to investors in assessing the market value of equity. We use a sample of 190 firms that disclosed estimates of total Y2K-compliance costs in their 1997 annual reports to examine the association between Y2K-compliance costs and share prices. We test the joint hypothesis that Y2K-compliance costs were relevant to equity valuation of firms that chose to become Y2K-compliant and that these costs were sufficiently reliable to be reflected in share prices. We find that estimates of Y2K-compliance costs were positively and significantly related to share prices after controlling for earnings, book value of equity, and other factors. We find that the stock market is not shortsighted, and consider investments in Y2K-remediation efforts a significant and value-increasing activity for the average firm.

Discussion of “Combining Earnings and Book Value in Equity Valuation”

1998 ◽  
Vol 15 (3) ◽  
pp. 325-341 ◽  
Author(s):  
DAVID BURGSTAHLER
Keyword(s):  
Equity Valuation ◽  
Book Value

The Roles of Earnings and Book Value in Equity Valuation: A Real Options Based Analysis

2002 ◽  
Author(s):  
Peter F. Chen ◽  
Guochang Zhang
Keyword(s):  
Real Options ◽  
Equity Valuation ◽  
Book Value

Combining Earnings and Book Value in Equity Valuation

1997 ◽  
Author(s):  
Stephen H. Penman
Keyword(s):  
Equity Valuation ◽  
Book Value

The value relevance of intellectual capital disclosure: empirical evidence from Kuwait

2017 ◽  
Vol 25 (1) ◽  
pp. 22-38 ◽  
Author(s):  
Mishari M. Alfraih
Keyword(s):  
Empirical Evidence ◽  
Financial Reporting ◽  
Intellectual Capital ◽  
Value Relevance ◽  
Practical Implication ◽  
Listed Companies ◽  
Annual Reports ◽  
Equity Valuation ◽  
Content Type ◽  
Market Participants

Purpose Drawing on market efficiency theory and studies on intellectual capital (IC) disclosure, this study aims to examine if IC information provided in the corporate annual reports of Kuwait Stock Exchange (KSE) listed companies in 2013 is value-relevant. Design/methodology/approach The analysis is divided into two parts. First, the level of intellectual capital disclosure (ICD) of KSE-listed companies is examined using the content analysis method. Second, the value relevance of financial reporting is examined empirically using Ohlson’s (1995) valuation model. Findings The results reveal that ICD is positively and significantly associated with market value, suggesting that greater ICD is valued by KSE market participants, who incorporate it into their valuation models. Practical implications Given the importance of ICD in enhancing equity valuation, a practical implication of this study is to make managers aware of its positive and significant effect on equity valuation, which may encourage companies to increase their level of disclosure. Originality/value This is the first study of the association between the level of ICD and the value relevance of financial reporting for market participants in Kuwait. It therefore extends and confirms the prior literature by broadening its scope to include frontier markets. Furthermore, it provides empirical evidence in support of recent calls from regulators and professional bodies for information that supplements and complements traditional financial reporting.

scholarly journals DAMPAK PENGUNGKAPAN SUKARELA DAN MANAJEMEN LABA TERHADAP INFORMASI ASIMETRI

2006 ◽  
Vol 6 (1) ◽  
pp. 19
Author(s):  
Wiwik Utami
Keyword(s):  
Earnings Management ◽  
Empirical Evidence ◽  
Stock Exchange ◽  
Manufacturing Sector ◽  
Negative Influence ◽  
Voluntary Disclosures ◽  
Book Value ◽  
Public Company ◽  
Stock Transaction ◽  
Research Show

<p class="Style1"><em>The objectives of the research are to find out empirical evidence of he impact of voluntary disclosures and earnings management on the </em><em>i</em><em>nformation asymmetry. The population of this study was public company</em></p><p class="Style1"><em>o</em><em>f manufacturing sector listed at Jakarta Stock Exchange, and the sample </em><em>as determined based on the following criteria: (a) the annual report</em></p><p class="Style1"><em>e</em><em>nded 31 December; and (b) book value of equity is positive. There </em><em>w</em><em>ere 92 companies meeting the criteria. Data analysis was carried out in </em><em>t</em><em>erms of pool cross-section covering stock transaction and annual financial </em><em>r</em><em>eport during 2001-2002. The research hypotheses were tested using </em><em>th</em><em>e regression analysis. The result of this research show that: (1) voluntary </em><em>di</em><em>sclosures had significantly negative influence on information asymmetry, </em><em>is finding gives empirical evidence that supports the theory that voluntary </em><em>d</em><em>isclosures had impact on increasing investor's belief so that information </em><em>a</em><em>symmetry is diclined; (2) earnings management had no impact on </em><em>in</em><em>formation asymmetry</em></p><p class="Style1"><strong><em>ke</em></strong><strong><em>ywords: </em></strong><em>Voluntary disclosures, Earnings management</em></p>

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