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Market-based valuation multiples: Evidence from agribusiness sector

Goh, Chin Fei and Md. Rasli, Amran and Dziekonski, Krzysztof and Khan, Saif Ur Rehman (2015) Market-based valuation multiples: Evidence from agribusiness sector. Pertanika Journal Of Social Science And Humanities, 23 (1). pp. 209-222. ISSN 0128-7702

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This article investigates the choice of multiples in valuing the agribusiness firms in Malaysia from 2003 to 2009. The agribusiness industry typically employs homogenous business models and produces standardized products, thus rendering excellent empirical settings to reveal the value drivers of such traditional industries. It was discovered that commonly adopted methodologies in valuation multiples are associated with pitfalls which may hamper the reliability of the valuations. Our findings also showed that price-to-earnings multiple leads to the best valuation performance, while price-to-sales multiple produces the worst results. Moreover, this research showed that growth prospect is an effective control factor in multiples valuation.

Item Type:Article
Uncontrolled Keywords:agribusiness, corporate valuation, multiples, plantation, value driver
Subjects:A General Works
ID Code:58501
Deposited By: Haliza Zainal
Deposited On:04 Dec 2016 12:07
Last Modified:30 Mar 2017 09:22

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