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Aims to examine a comprehensive approach to combine several simple multiple valuation, so as to improve the valuation, accuracy of the simple multiple valuation technique.
Abstract
Purpose
Aims to examine a comprehensive approach to combine several simple multiple valuation, so as to improve the valuation, accuracy of the simple multiple valuation technique.
Design/methodology/approach
In order to combine several simple multiple valuations, the equity value is estimated by a weighted average of the valuation outcomes obtained from several simple multiple valuations. To calculate the weight of each valuation outcome, the out‐of‐sample price‐deflated regression of stock prices on several simple multiple valuation outcomes is conducted. Next, the alternative hypothesis of whether the composite approach yields a higher valuation accuracy than the simple multiple valuation is tested, using the actual stock price of the valued firm as the benchmark to measure the valuation accuracy under the assumption of market efficiency.
Findings
It was found that combining several simple multiple valuation outcomes of a firm, each of which is based on a stock price multiple to a historical accounting performance measure of the comparable firms (historical multiple), improves the valuation accuracy of the simple multiple valuation using a single historical multiple. However, further analysis shows that the combination of the simple multiple valuation outcomes based on a stock price multiple to analysts’ earnings forecasts of the comparable firms (forward earnings multiple) and several simple multiple valuation outcomes based on historical multiples does not improve the valuation accuracy of the simple multiple valuation using a forward earnings multiple.
Research limitations/implications
One caveat of this study is that only the linear combination of the simple multiple valuation outcomes is considered. Non‐linear combination of the simple multiple valuation outcomes based on both forward earnings multiple and historical multiples may be able to improve the valuation accuracy of the simple multiple valuation using a forward earnings multiple. This possibility is still an open question.
Practical implications
The findings imply that a historical multiple contains incremental information not captured by other historical multiples, which is useful for the improvement of the valuation accuracy. However, the historical multiples may have no incremental information beyond a forward earnings multiple.
Originality/value
The forward earnings multiples as well as the historical multiples for the equity valuations of broader firms are considered. Given the previous finding that forward earnings multiple presents the highest valuation accuracy among the valuation multiples, it is further investigated whether the composite approach using forward earnings multiple and historical multiples can improve the valuation accuracy of the simple multiple valuation using a forward earnings multiple. In addition, the potential problem of selection bias in the previous study is addressed, which examines only the equity valuations in the tax court.
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Keywords
Anil Mathur, Benny Barak, Yong Zhang, Keun S. Lee, Boonghee Yoo and Jeeyeon Ha
– The purpose of this paper is to develop a scale to measure social religiosity (SR) and assess its measurement invariance across different cultures.
Abstract
Purpose
The purpose of this paper is to develop a scale to measure social religiosity (SR) and assess its measurement invariance across different cultures.
Design/methodology/approach
The research relied on samples from China (n=486), India (n=377), Japan (n=362), Korea (n=386), and the USA (n=580). The invariance process involved carrying out a series of confirmatory factor analyses with progressively more restrictive constraints.
Findings
Results show the SR scale to be reliable and valid across culturally and religiously diverse countries. Implications of the findings are also discussed.
Originality/value
Based on Katz (1988) this is a new scale to measure SR and its measurement invariance is assessed across culturally divergent countries.
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Purpose – The purpose of the research was to examine the process of new teacher evaluation policy development in South Korea, in order to gain insight into how a controversial…
Abstract
Purpose – The purpose of the research was to examine the process of new teacher evaluation policy development in South Korea, in order to gain insight into how a controversial policy could be established in education. Research questions were about the process of the policy development, political actors involved and their influences, and the meaning of teacher evaluation in the newly established teacher evaluation policy.Methodology – The study uses a qualitative and descriptive-analytical process from a hermeneutics perspective that views policy as text to be interpreted. This perspective allows policy to be connected to a larger social context through interpretations of text. The main data sources included policy documents, statements by various organizations, research reports, and public media artifacts produced between 2000 and 2012. For data analysis, constant comparison and content analysis methods were used.Findings – The findings show that the process of developing a teacher evaluation system demonstrated an unsuccessful attempt to apply the Habermasian notion of discursive democracy. Relevant stakeholders were invited to deliberate on the reform, but official meetings ended prematurely without consensus. In the end, the government proceeded without full support of any stakeholders. During the deliberation process, teacher organizations and parent groups demonstrated conflicting perspectives on teacher work and the new evaluation system only partially accommodated both perspectives. The effectiveness of the new evaluation system remains to be researched.Value – The policy development process and the evaluation system shown in this study should inform similar efforts in other contexts.
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