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Dear sir,
We can easily value the share of a quoted company by dividend valuation model, which considers the future expected dividends.
In case of unquoted companies, we have to use other models like net assets based and income based.
Can we use the net asset based and income based for a quoted company as well ?? I think the dividend valuation model is the best for quoted companies?
Thanks,
If it is a quoted company then the value of the shares is whatever the share price is on the stock exchange (which in theory is the present value of future expected dividends – i.e. the dividend valuation model – but in practice is affected by many things).
It is only if someone was considering acquiring a majority stake in a quoted company that other methods of valuation would be considered in deciding how much the acquirer might be prepared to offer for the shares.
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