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Questions tagged [stock-valuation]

For questions relating to the valuation of stocks, based on fundamental analysis, market conditions, etc.

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Valuation of a startup unicorn [on hold]

By all those news reports of privately held startups that are considered unicorns worth more than a billion: I get they reach it by +equity-liability + future earnings. I don't see any way of ...
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1answer
30 views

Relation between par value, offering price and trading range

I recently saw a public offering of securities stating the following: We are offering 2,000,000,000 shares of our common stock, par value $0.00001 ("Common Stock"), at an offering price of $0.001 ...
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1answer
191 views

How many Tesla Y are ordered/reserved so far

Tesla Y is allowing to order ( similar to Tesla 3 reservation but allowing to choose configuration). I remember when Tesla 3 was announced there were plenty of information released by Tesla and 3rd ...
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1answer
29 views

How to count average EPS for interval of years if in this inverval was a split?

For example, I want count average EPS for 10 year for company and this company has stock split (2 to 1) in this 10 years. Do I need to take this into account calculating average EPS for this 10 ...
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1answer
98 views

What is “corporate drag”?

What is meant by the term corporate drag? Have seen this in some valuation analyses associated with a numerical cost value, but googling terms like "corporate drag" or "corporate drag value" do not ...
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0answers
37 views

How to quantify the cheapness (or overvaluedness) of a stock from dividend yield theory perspective?

Is there a way to quantify the potential cheapness (or overvaluedness) of a stock's price when comparing current and average dividend yield from a dividend yield theory (DYT) perspective? For example ...
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0answers
45 views

Comparing values of 5s and 7% notes

I am a beginner in investment. I was reading Security Analysis (Sixth Edition) by Benjamin Graham, and on page 63 the last paragraph is written that: A third kind of analytical conclusion may be ...
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2answers
65 views

Calculations for stock market target price?

I'm looking at various stocks on finance websites and noticed that some of them don't have a 1-year Target price. How can I calculate estimated target price of a stock myself based on the company's ...
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1answer
519 views

Why can unissued capital stock exist?

Unissued capital stock allows a company to issue shares at any given time, diluting the ownership of current shareholders. This does not seem logical nor fair. At any given time, shouldn't 100% of the ...
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3answers
74 views

If a company's “shareholders equity” has been increasing, why would the market value of their stock decrease?

There are companies whose "shareholders equity" in their balance sheet have been increasing due to positive earnings, but whose stock prices in the markets have dropped. Why is this happening? Isn't ...
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5answers
198 views

Why isn't the retained earnings of a public company always distributed back to the shareholders?

Shareholders own a public company, so why shouldn't all of a company's income be distributed back to them? Why are dividends (if any) just a small fraction of a company's retained earnings?
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1answer
53 views

What are the ways to price a holding company?

I would like to know how people value holding companies. I guess the most famous one is Berkshire ($BRK.A - $BRK.B). And others exist. These holdings usually have a lot of exposure to realestate, PE ...
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1answer
81 views

P/E as market capitalization / net income

Price/earnings ratio is defined as: P/E = Share Price / Earnings per Share If we multiply both the numerator and the denominator with the number of shares, we get: P/E = Market Capitalization / ...
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1answer
96 views

Diversification over Profits?

Everyone claims that its very important to diversify your portfolio to reduce risks and increase the possibility of long time profits. There are basically 3 industry sectors that I know rather well ...
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1answer
38 views

Vanguard CRSP total index versus a value and growth combination of the same index?

I am currently researching Vanguard Mid-Cap and Vanguard Small-Cap indexes. The methodology for inclusion in these indexes is outlined in the CRSP Methodology Guide. According to the guide, inclusion ...
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2answers
333 views

Warren Buffet's calculation of the value of the company - very low discounting rate

I was read the book "The Buffett Way". The book claims that Warren Buffett uses a simple calculation to calculate the intrinsic value of a company. The regular way is to estimate future earnings &...
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4answers
912 views

Does short-selling hurt companies' stock price in the long-term?

Today, I've read a Bloomberg article on latest Musk tweet tantrums, where he, among other things, mentioned this: Short-sellers are value destroyers. Should definitely be illegal. Is that ...
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2answers
146 views

What do you think the fair price of this stock is based on these summarized financial statements? [closed]

I have been trying to make a valuation by reading the financial statements, but I believe I am just guessing. I have an idea, but I do not understand completely. Can I get a valuation and a short ...
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3answers
89 views

Buyback & Split

I receive stock options as part of my compensation package. The stock split a few years ago and rumor has been its about time to split again. Then the company announced a pretty big stock buyback ...
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2answers
4k views

Shorting a stock after dividend

Theoretically, the price of a stock should always fall whenever a dividend is paid out to shareholders. Is this true in practice? If it is, I can just short the stock before the dividend is paid and ...
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3answers
146 views

Does price of stock reflect earnings

If a company's earnings keep rising and the stock price keeps falling because of other factors such as lawsuits, tariffs etc., is there any guarantee that the price will rise eventually? When does ...
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2answers
75 views

Earnings speculation stocks

Is it a good idea to buy a stock before its earnings come out if I believe that there will be a surprise and then sell after the report comes out? Will the gains be substantial enough for me to take ...
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2answers
213 views

Why is SHLD trading at ~$2 when it has $-38 book value?

I took a look at SHLD financial statements and I cant understand why SHLD is trading at ~$2 when it has -$38 book value and a highly negative P/E? What am I missing?
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1answer
265 views

Does Yahoo finance adjust ETF's historical data for splits and dividends? (not stocks or shares)

On the ETF's graphs I see there are steep falls. There is a legend indicating the ETF was split 1:10. However like Stocks or Shares, I don't see the price being adjusted for splits. Is this correct, ...
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1answer
1k views

Can I short a stock for a long amount of time?

The next recession is inevitable, if what I read is to be believed. Whether it happens tomorrow, or in 10 years, it's coming. Why shouldn't I short many stocks, and hold on to them for whatever ...
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2answers
169 views

How do stocks rise?

If a stock shows great performance on the income statement, will the prices rise gradually or immediately after the release of information to the public?
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1answer
184 views

What are the mechanics of tracking stock?

I'm curious about tracking stock. Take, for example, NASDAQ:DVMT. It's a tracking stock issued by Dell for VMWare (NASDAQ:VMW), which is partly owned by Dell. The idea is that people could invest in ...
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2answers
124 views

what kind of stock graph is this?

this is the same pic with time frame I found this stock,but it has an unusual candlestick pattern,it is a pennystock.
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3answers
247 views

How to evaluate a job offer with stock purchase options of a series D company vs series B company?

A late stage series D startup is offering 40,000 shares at a strike price of around $1. I also have another offer from a series B startup offering similar number of stocks at 0.5$. Both these ...
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1answer
104 views

Studying for basic finance exam and stuck finding the stock value

I'm not sure if this is the right place to ask a school related question but any help would be much appreciated! Note that this is not an actual graded assignment but I am studying for an exam with ...
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3answers
102 views

How is a grant of stock treated from an income tax perspective?

If I go to work for a private company and they give me stock in the company how is that treated from an income perspective? Is the value of the stock just its par value (which can be nominal in a ...
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1answer
86 views

Hypothetically speaking, Stock Price won't change in case there is no Volume? [duplicate]

Hypothetically speaking, let's say there is no trading volume during 1 year for a given stock, does that mean the stock price will remain the same regardless of how the company is performing? Let me ...
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2answers
80 views

What if company total share value are more and assets are less

Suppose If any company have $10m total valueation and issue the shares than when company have total $12m value but shares are selling at more than that value does it affect anything or is it illegal ...
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1answer
104 views

Notice of Conversion for 3(a)10

I am trying to figure out what this means. Is this good or bad? http://markets.businessinsider.com/news/stocks/metrospaces-announces-that-it-will-not-honor-notice-of-conversion-for-3-a-10-due-to-...
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8answers
4k views

At which P/E ratio can a stock be considered overvalued?

What's the "highest" P/E ratio that can be considered healthy? Sure, someone can argue that company X has growth potential, but even that is limited. For example: Netflix has currently a P/E ratio of ...
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1answer
502 views

If a stock assures that they will never pay out any dividends in the whole future of the company, is it worth anything? [duplicate]

I've had this discussion a lot with friends. It is simalar to this question: If a stock doesn't pay dividends, then why is the stock worth anything? ...But it is actually not the same. Most ...
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3answers
252 views

How Market Price works?

This is probably a very dumb question but I don't get it. Usually people say if there are more buyers then the price goes up, and if there are more sellers it goes down. Why is that? And in which ...
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8answers
5k views

Why can more jobs mean more inflation and decreased stock prices? What are other links in the chain to watch out for? [closed]

Many news outlets, such as this one (there are many examples), are reporting that the current US stock sell-off is due to a stronger-than-expected jobs report in January and fears of inflation and ...
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1answer
180 views

Why is there a significant disparity between 409A valuation and fair market value?

I'm at an interesting juncture where I have the opportunity to exercise some ISOs at a startup, and I'm somewhat confused at the disparity between the two valuations. In my case, I can exercise my ...
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3answers
1k views

Found old paper shares for company that has since merged

My dad recently went through their safe deposit box and found a paper certificate for 4 shares in Northern States Power Company, issued in 1988. In 1998, NSP and New Century Energies of Denver merged ...
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1answer
1k views

Reading depth charts and mathematics of price determination

This is a very basic question, and I apologize if this is the incorrect space to ask about the subject of mathematics applied to computational output of price for stocks; however, I am wondering how '...
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3answers
756 views

Volatility indicator

Is there an indicator for the volatility of a stock? When I say indicator I mean like P/E ration, book value etc. If yes, where can I find it? I follow yahoo finance by the way.
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3answers
190 views

How much will a stock be worth after a merger?

Suppose I own a common stock in ABC Corp that's currently worth $32.00. Now XYZ Inc and ABC Corp have completed a merger agreement, with XYZ Inc agreeing to pay $36 for each share of ABC Corp, ...
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1answer
47 views

Regarding Australian CBS takeover of TEN

So in relation to CBS takeover of TEN. My understanding is "they are purchasing the company" is this correct? Because I am struggling with getting my head around the procedure. For example, If I ...
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1answer
382 views

Can the exercise price of a warrant get changed later?

I am reading warrant agreement of IPOA.WS, and it says the following agreement https://www.lawinsider.com/contracts/5HBOWpGR5PHYqHb3hoCK2h/social-capital-hedosophia-holdings-corp/1706946/2017-09-18#...
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2answers
9k views

Is my stock gone forever from a reverse split / bought by another company?

I'm a complete novice in regards to investing and had purchased some shares of OXIS from TD Ameritrade back in March of 2015 (NASDAQ). The company (OXIS International) became very devalued and did a "...
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1answer
534 views

Does distribution of FPO by a company affect the current market price of the company in secondary market? [closed]

If a company announce and distribute the "Further public offer" (FPO) will the market price of that company in secondary market get adjusted? If it adjust then what will be the formula to find out the ...
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1answer
292 views

Announcement of rights offering (above market price) causing stock price increase [duplicate]

I am befuddled by the announcement of a rights offering in which stockholders were given the right to purchase the stock at a price of 5.50$ when the market price was at 4.40$. This seemed very ...
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1answer
143 views

How much is an asset producing $X/month is worth?

Let's say there is an asset that produces $1000/month. There is a limited amount of them in total, let's say 1000 of them (each generating $1000/month). No more can be printed or generated. This ...
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1answer
199 views

What makes a stock get 40 times avg daily volume without any news?

I have been watching the ticker CDNA for a while now, in 4.5 they released news regarding its newly developed service AlloSure recieving draft LCD which is big news for this kind of company, the news ...