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how do you calculate the value of a firm's shares. please need guide thanks

how do you calculate the value of a firm's shares.
please need guide thanks

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Answer #1

Solution :- The Value of a firm share is not same as the Book Value of share , we can calculate the Value of firm share that is market price of share

The Value of Firm Share can be Calculated by Dividend discount model :- In this model we can calculate all the future expected dividends and then after calculate the present Value of that dividends . and the sum of the Present Value of all the future dividend is the  value of a firm's share . Apart from this we can also calculate using PE ( Price - Earning ) Ratio . If we know the firm PE ratio and the EPS ( Earning Per share ) of the company , then we can calculate the value of firm share by multiply the PE Ratio and Earning per share .

If there is any doubt please ask in comments

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