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share price and TERP

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › share price and TERP

  • This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.
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  • July 27, 2023 at 12:08 pm #689010
    alawi sayed
    Participant
    • Topics: 301
    • Replies: 352
    • ☆☆☆☆

    Hello Sir,

    Sometimes in question it is asking the market share after the rights issue.So if we are giving the P/E ratio then when can calculate the new share price or market value of the shares by multiplying the P/E into the Earnings

    But sometimes we are not giving any information so can we say that the share price will be the TERP?

    Thanks,

    July 27, 2023 at 5:07 pm #689028
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54655
    • ☆☆☆☆☆

    Usually when a question asks for the TERP you are given information about the current share price, and the price of the rights. Then we calculate the TERP in exactly the way that I explain in my free lectures.

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