Valuation of different industry sectors


Discounted cash flow valuation method and return to economic fundamentals are suitable to value internet companies. Simple relative valuation methods like price to earnings (P/E) is not suited to value internet companies. Financial services reinvestment basically focuses on intangible assets like brand names and human capital. Dividend discount model, free cash flow to equity, asset valuation models can be used to value financial services firms. The relative value metrics used for valuing financial institutions are P/E, price-to-book, and price-to-sales ratios. CAMEL is an internal supervisory tool for evaluating the soundness of a financial institution. The financial indicators used to evaluate ...

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