Multiplier Models – Price Multiple Model

  • [j] Price multiples to value stocks (use of multiples based on comparables).
  • [k] Calculate price to earnings, price to an estimate of operating cash flow, price to sales, and price to book value.

Terms covered: Justified P/E, Sustainable growth rate, Dividend payout ratio, P/E ratio

Why is the language of the Learning Outcome Statements (LOS) different from the curriculum?
The LOS are protected under the CFA Institute's copyright, and we don't have permission to duplicate them verbatim. Therefore, we've rephrased the LOS and included alphabetical labels (a, b, c, …) to simplify cross-referencing with the original LOS in the curriculum when needed.

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