Stock Valuation: A Second Look - Caluation Based on Comparable Firms

4 important questions on Stock Valuation: A Second Look - Caluation Based on Comparable Firms

What are a firms forward earnings?

A firms anticipated earnings over the coming 12 months

In valuation, is the forward P/E or the trailings P/E prefered?

forward P/E

What three formulas can be used to calculate a firms Forward P/E?

Forward P/E = P0/EPS1 = Div1/EPS1/(rE-g) = Dividend Payout Rate / (rE-g)
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With what formula do you calculate enterprise value to EBITDA?

V0/EBITDA1 = FCF1/EBITDA1/(rwacc-gFCF)

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