Hi there,The question to answer about the report will be "Do you think share price reflects true value of a firm?" I need roughly about 10-15 references and needed all to be from journals. No...

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Hi there,The question to answer about the report will be "Do you think share price reflects true value of a firm?"
I need roughly about 10-15 references and needed all to be from journals. No wikipedia whatsoever. Textbook can be used such as International Financial Reporting and Analysis by David Alexander, Anne Britton or Financial Accounting Theory by Craig Deegan and Jeffrey Unerman.

Answered Same DaySep 29, 2020

Answer To: Hi there,The question to answer about the report will be "Do you think share price reflects true...

Sarabjeet answered on Oct 04 2020
153 Votes
Share Prices
Share prices
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Executive Summary
This essay is an evaluation of the research question, "Do you think share price reflects true value of a firm?"What will be included is share price, the ways how share price displays true value of firm,
how share prices will impact firm’s aims as well as objectives. In this report certain theories that will support the main arguments evaluated are also highlighted in this essay it could be in any way for or against.
Contents
Introduction    4
"Do you think share price reflects the true value of a firm?"    4
The phenomenon from different perspectives – (Theory)    5
Arguments    7
Conclusion    8
References    9
Introduction
This essay initiates a debate whether share price displays true value of a firm or not. This essay will also include phenomenon from various perspectives and theoretical views on the share prices. The theory that will be involved is Efficient Market Hypothesis when the market is finally delivering its long-term overdue corrections, and then it is comforting to recall.  “Share prices hardly ever reflect the company’s true value it happens accidentally. “Marked to Market,” is known as a mechanism through which each and every single share of the stock in the public firm is valued    from one to another all through the day.
The phenomenon from different perspectives – (Theory)
According to Cengiz (2014) few people have a neutral attitude towards the Effective Market Hypothesis. Firms either believe it or stick to a passive, broad-market investment strategy, or firms hate it as well as focus on choosing stocks based on the growth potential and undervalued assets. EMH indicates that the market price of the stock contains each and every information about the stocks which means that the share is accurately valued before future events change the valuation (Dimitras, Gaganis and Pasiouras, 2018).
I believe that stock prices are preferably supposed to simply reflect the true value of the firms. A stock price can be described as the present value for every future benefit related to the share (Sloan, 1996). The higher expected future profits and benefits associated with the share, the greater the price thereof. I can describe earnings as well as dividends as expected future advantages which mean that the earnings and dividends figures are essential with respect to the share prices. There is a positive reaction of the market to the announcement of the earnings and dividends. This knowledge on dividend and on the earnings serves as a signal furthermore the market responds to it (CENGIZ, 2014).
There are many perspectives that explain share price reflects firm’s true value. According to (Malkiel, (2003) typical public corporation only has thin part of its entire shares that trade on trading exchanges during the day. If company's preferred mutual fund has been held to hold the organization’s...
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