On accounting-based valuation formulae

• 成果类型: Article; Proceedings Paper
• 署名作者: Ohlson, JA
• 署名单位: Arizona State University; Arizona State University-Tempe
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-005-1534-4
• 发表日期: 2005
• 页码: 323-347
• 关键词: Equity; cost

摘要

This paper considers accounting-based valuation formulae. Its initial focus is on two problems related to residual income valuation (RIV). First, insofar valuation depends on theresent value of expected dividends per share, applying RIV requires clean surplus accounting on a per share basis. Awkwardly, equity transactions that change the number of shares outstanding generally imply eps not equivalent to Delta bvps - dps. A clean surplus equality holds only if one re-conceptualizes either end-of-period bvps or cps as a forced plug. Second, one cannot circumvent the per share issue by evaluating RIV on a total dollar value basis unless one introduces relatively subtle MM-type restrictions. In light of RIV's unsatisfactory aspects, the paper proposes an alternative to RIV. This new approach maintains a strict eps-focus. It derives by replacing bvps, in RIV with eps, I capitalized (i.e. divided by r). One obtains a formula such that the current market price equals next-period expected earnings capitalized plus the present value of expected abnormal earnings growth, referred to as AEG. A number of propositions then demonstrate the advantages of the AEG approach as compared to RIV. These results follow because eps(t+1) capitalized generally approximates market price better than bvps(t).