Theory argues that conglomerates do not trade at a discount and the difference found in valuation are based on flawed measurement Issues in Model Selection (S) An Appropriate Valuation Model Should Be:- Consistent with the characteristics of the company being valued - Appropriate given the level of...
This popular method is based on thelaw of one price, which states that identical assets should sell for the same price. In theory, a company trading at 14 times earnings is attractively priced compared to a similar company with a P/E ratio of 20. ...