Equity Asset Valuation Workbook Second Edition

A companion workbook for the Second Edition of Equity Asset Valuation

In the Second Edition of Equity Asset Valuation, experts Jerald Pinto, Elaine Henry, Thomas Robinson, and John Stowe, fully detail the contemporary techniques used to determine the intrinsic value of an equity security, and show you how to successfully apply these techniques in both foreign and domestic markets.

In the Second Edition of the Equity Asset Valuation Workbook, they offer you a wealth of practical information and exercises that will further enhance your understanding of this discipline. This detailed study guide-which parallels the Second Edition of Equity Asset Valuation chapter by chapter-contains concise summary overviews of the chapters, challenging problems, and a complete set of solutions.
* An all-inclusive study companion to the Second Edition of Equity Asset Valuation
* Topics covered include the equity valuation process, discounted dividend valuation, free cash flow valuation, and residual income valuation
* Challenges readers with question/answer sections for each chapter in the main book

Engaging and accessible, the Second Edition of the Equity Asset Valuation Workbook reviews essential concepts you must be familiar with in order to excel at this endeavor.

In the Second Edition of Equity Asset Valuation, experts Jerald Pinto, Elaine Henry, Thomas Robinson, and John Stowe fully detail the contemporary techniques used to determine the intrinsic value of an equity security and show you how to successfully apply these techniques in both foreign and domestic markets.

Equity Asset Valuation Workbook, Second Edition offers a wealth of practical information and exercises that will further enhance your understanding of this discipline. This detailed study guide which parallels the Second Edition of Equity Asset Valuation chapter by chapter contains concise summary overviews of the chapters, learning outcomes, challenging problems, and a complete set of solutions. Engaging and accessible, the Second Edition of Equity Asset Valuation Workbook reviews essential concepts you must be familiar with in order to excel at this endeavor.

PART I

Learning Outcomes, Summary Overview, and Problems

CHAPTER 1

Equity Valuation: Applications and Processes 3

Learning Outcomes 3

Summary Overview 3

Problems 5

CHAPTER 2

Return Concepts 7

Learning Outcomes 7

Summary Overview 7

Problems 9

CHAPTER 3

Discounted Dividend Valuation 13

Learning Outcomes 13

Summary Overview 14

Problems 16

CHAPTER 4

Free Cash Flow Valuation 25

Learning Outcomes 25

Summary Overview 26

Problems 28

CHAPTER 5

Residual Income Valuation 41

Learning Outcomes 41

Summary Overview 42

Problems 43

CHAPTER 6

Market–Based Valuation: Price and Enterprise Value Multiples 49

Learning Outcomes 49

Summary Overview 50

Problems 52

CHAPTER 7

Private Company Valuation 59

Learning Outcomes 59

Summary Overview 60

Problems 61

PART II

Solutions

CHAPTER 1

Equity Valuation: Applications and Processes 71

Solutions 71

CHAPTER 2

Return Concepts 73

Solutions 73

CHAPTER 3

Discounted Dividend Valuation 77

Solutions 77

CHAPTER 4

Free Cash Flow Valuation 85

Solutions 85

CHAPTER 5

Residual Income Valuation 99

Solutions 99

CHAPTER 6

Market–Based Valuation: Price and Enterprise Value Multiples 107

Solutions 107

CHAPTER 7

Private Company Valuation 113

Solutions 113

About the CFA Program 117

JERALD E. PINTO, PhD, CFA, is Director, Curriculum Projects, in the Education Division at CFA Institute. Before coming to CFA Institute in 2002, he consulted to corporations, foundations, and partnerships in investment planning, portfolio analysis, valuation, and quantitative analysis. Pinto also worked in the investment and banking industries in New York and taught finance at NYU's Stern School of Business. He holds an MBA from Baruch College, a PhD in finance from the Stern School, and is a member of CFA Virginia.

ELAINE HENRY, PhD, CFA, is an Assistant Professor of Accounting at the University of Miami, where she teaches courses in accounting, financial statement analysis, and valuation. After working in corporate finance at Lehman Brothers, strategy consulting at McKinsey & Company, and corporate banking at Citibank, she obtained a PhD from Rutgers University where she majored in accounting and minored in finance.

THOMAS R. ROBINSON, PhD, CFA, CPA, CFP, is Managing Director of the Education Division at CFA Institute. He joined CFA Institute as head of educational content in 2007 from the University of Miami, where he was an associate professor of accounting and director of the Master of Professional Accounting Program. Robinson was also concurrently managing director of a private wealth investment advisory firm. He was active locally and nationally with the CFA Institute prior to joining the staff.

JOHN D. STOWE, PhD, CFA, is O'Bleness Chair Professor of Finance at Ohio University. He previously served as Head of Curriculum Development and Director of Exam Development at CFA Institute. Stowe has also been professor of finance and associate dean at the University of Missouri Columbia, where he taught investments and corporate finance. Stowe has won several teaching awards and has published frequently in academic and professional journals in finance. He is also coauthor of a college–level textbook in corporate finance. Stowe earned his BA from Centenary College and his PhD in economics from the University of Houston. He obtained his CFA charter in 1995.