Method for determining the current value of a company by examining and comparing the financial ratios of relevant peer groups, also often described as comparable company analysis or comps). The most widely used multiple is the price-earnings ratio (P/E ratio) of stocks in a similar industry. Using the average of multiple PERs improves reliability but it can still be necessary … [Read more...]
What Is Common Stock Financing?
Common stock financing represents the sale of ownership stakes within a corporation in exchange for cash or capital considerations. Investors and management must become familiar with the role of the corporation and the basic means with which to finance the business in order to appreciate shareholder rights and privileges. Common stock equity financing does carry distinct risks … [Read more...]