How to determine the market value of a company and what
factors are relevant to determine if the company is a
viable investment in the long term?
Answer Posted / shrikant sapaliga
For companies listed on a stock exchange the most
conventional way would be to multiply its share price by
the number of shares in issue, this is the current market
values of the company known as its market capitalization.
For investing in a company for a long term perspective, one
should look at the P/E ratio (MPS/EPS). The PE ratio of the
company should be less than the PE ratio of that industry.
(Lower the better). Also one should look for EPS. (Higher
the better).
| Is This Answer Correct ? | 4 Yes | 0 No |
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