Valuation of Common Stock Using the Earnings Multiple Model: An Applied Study in the Iraqi Stock Market
DOI:
https://doi.org/10.51173/jt.v5i4.863Keywords:
Profitability Multiplier Model, Stock ValuationAbstract
The aim of the research is to present the concept of the profitability multiplier model and to study the extent to which this P/E model can measure the real value of common stocks as it is one of the important models in helping investors know the difference between the market value of common stocks and the real value, and to prove the research hypothesis, the research sample was chosen for the financial sector And the selection of a group of banks listed on the Iraq Stock Exchange, consisting of thirteen banks for the extended period (2015-2019).
The results of the research reached the ability of the profit multiplier model to explain the true value of the common shares of the research sample and the Iraqi environment, where the results concluded that all the values measured according to the research model were greater than the market value and this helps investors to increase their chance of achieving higher profits, It also indicates that there is a weakness in the efficiency of the market.
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Copyright (c) 2023 Ayman Jadoua Faisal Al-shammari, Shatha Abdul-Hussein Jabr, Abbas Hashem Muhalhal, Bader S. S. Hamdan
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