Sentences with phrase «change in the valuation multiple»

I found this projection interesting and set out to examine how realistic it is, given what we know at this point in time, by decomposing total stock returns to its components, namely dividend yield, inflation, real earnings growth and change in the valuation multiple.

As the period of analysis lengthens, a larger contribution of a stock's return comes from a change in the fundamentals, compared with the contribution from a change in valuation multiples.

About 80 percent of first - year returns typically come from a change in valuation multiples and 20 percent from a change in fundamentals.

One way to project future expected returns, and to analyze past returns, is to separate them into a component that comes from growth in fundamentals and the component that comes from the change in the valuation multiple on those fundamentals.

But what really drives the change in valuation multiples is the numerator; the price investors are willing to pay for a certain amount of earnings.

Value investors tend to focus far too much attention on this potential change in the valuation multiple, and often ignore what's otherwise a company that offers a poor return on capital.

Not exact matches

When you purchase a broad swath of equities, say an S&P 500 index fund, the returns you can expect over the next decade or so comprise four building blocks: the starting dividend yield, projected growth in real earnings per share, expected inflation, and the expected change in «valuation» — that is, the expansion or contraction in the price / earnings (P / E) multiple.

In general, changes in valuation are driven by shifts in k: changes in interest rates (Rf) drive longer - term trends in valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zIn general, changes in valuation are driven by shifts in k: changes in interest rates (Rf) drive longer - term trends in valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zin valuation are driven by shifts in k: changes in interest rates (Rf) drive longer - term trends in valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zin k: changes in interest rates (Rf) drive longer - term trends in valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zin interest rates (Rf) drive longer - term trends in valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zin valuation multiples, while shocks to valuation multiples are almost always driven by shifts in the risk premium zin the risk premium z.]

Stocks can see their PE multiples expand and contract in a manner that has almost nothing to do with changes in EPS, which makes looking at these metrics a poor indicator of valuation or future returns.

Let's look at what happened to the change in the CAPE valuation multiple and its contribution to total returns in the 1960s, which was an environment of low interest rates to start with which moved higher over the decade.

[N American stocks often trade at a multiple of UK valuations, particularly when it comes to hot new sectors — witness the astounding step - change in HIVE Blockchain Technologies» share price & valuation.]

Participants from the lending, multiple listing services, and real estate worlds discussed how technological advances are changing the world of valuations, and in some instances creating more confusion than efficiencies.