A Theory of Financial Analysis |
Contents
The Accounting Framework of Financial Analysis | 13 |
Implications | 29 |
The Capitalization of an Income Stream Part I | 37 |
Copyright | |
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accounting depreciation aggregate assume assumption b₁ b₂ behavioral book value capital structure cash flow certainty equivalent chapter constraint corporation corporation's cost of capital debt debt-equity ratio decision derivative determine discount function discount rate dividend capitalization model dividend payment dividend stream economic equity example expected value expressed figure financial analysis firm firm's forward rates given government bonds growth rate higher increase interest rate investment investor iso-price line LC function lender loan maximize share prices maximum Modigliani and Miller national income objective function optimal output P₁ payoff matrix percent portfolio present value price equation problem profits rate of discount rate of growth rate of return relationship result retained earnings retention rate return on assets rise risk exposure shareholders shift slope specified statement stock valuation stockholders stream of dividends Substituting sVar(g taxes valuation equation valuation model variables variance yield curve γι