In 2010, the Morgan Stanley analysts covering eBay had stopped using PEG to value eBay, relying on
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In 2010, the Morgan Stanley analysts covering eBay had stopped using PEG to value eBay, relying on P/E, P/S, and discounted values of free cash flows. In 2013, they dropped P/E and P/S, and only used discounted free cash flows. In 2015, they based their price targets primarily on P/E, and claimed to rely on discounted values of free cash flows as “support” and a “sanity check.” How would you interpret these changes over time in valuation methodology?
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Dropping the use of PEG was sensible as properly done PEG adds no new information Drop...View the full answer
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Related Book For
Behavioral Corporate Finance Concepts And Cases For Teaching Behavioral Finance
ISBN: 9781259277207
2nd Edition
Authors: Hersh Shefrin
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