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glamour stock, good comparable, analysis, asset-based, pricing models,

1. A glamour stock is usually more under-valued than a value stock? (true or false)

2. What are three properties that make for a "good comparable"?

3. In what type of industry could you most justify an asset based valuation approach? Why?

4. Which of the typical multiple is better in your opinion - why?

5. Which of the steps involved in fundamental analysis is the most important in your opinion - why?

6. How is value created?

7. Is an over abundance of information (or information overload) as a weakness of the asset based valuation approach?

8. Do asset pricing models give (asset prices or required rates of return)?

9. The multiples approach is (better or worse) than the fundamental analysis valuation approach?

10. The payment of a dividend (increases or decreases) the market price of the stock (in a fully informed market with no information signaling effect)?

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Answer:
1. A glamour stock is usually more under-valued than a value stock? (true or false)

Its false that glamour stock usually more under valued than the value stock because glamour stock are those stock that have been bid up and has selling price higher relative to its comparables like cash flow, book value and earning multiples.

2. What are three properties that make for a "good comparable"?

Three properties that make for a good comparable are:
(1) Select a half dozen comparable firms from the industry and use the group median multiple of interest for valuation
(2) Select the companies that are most similar and a direct competitor of the company in valuation
(3) Use aggregate market multiples if there are insufficient number of similar firms available for comparison.

3. In what type of ...

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The expert examines glamour stock, good comparable, analysis and asset-based pricing.

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