haku: @indexterm VALUATION / yhteensä: 677
viite: 24 / 677
| Tekijä: | Demirakos, E.G. Strong, N.C. Walker, M. |
| Otsikko: | Does valuation model choice affect target price accuracy? |
| Lehti: | European Accounting Review
2010 : VOL. 19:1, p. 35-72 |
| Asiasana: | accounting finance investments valuation prices equities models United Kingdom |
| Kieli: | eng |
| Tiivistelmä: | This study explores whether the valuation (hereafter as: val.) model (here as: val-mdl.) choice affects the forecast accuracy (as: accry.) of the target prices issued by investment (as: inv.) analysts in their equity research reports, controlling for factors influencing this choice. Examined are 490 equity research reports from international inv. houses for 94 UK-listed firms published from July 2002 to June 2004. Four measures of accry. are used, that is, whether the target price is met 1. during the 12-month forecast horizon (here as: f-h.), 2. on the last day of the 12-month f-h., 3. the absolute forecast error (as: f-e.), 4. the f-e. of target prices that are not met at the end of the 12-month f-h. Based on 1. and 3., price-to-earnings (PE) outperform discounted cash flow (DCF) models, whereas based on 2. and 4., the difference in val-mdl. performance is insignificant. However, after controlling for variables capturing the difficulty of the val. task, the performance of DCF models improves in all specifications and, based on 4., they outperform PE models. |
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