BUSI 530 Chapter Notes - Chapter 7: Dividend Discount Model, Discounted Cash Flow, Stock Valuation
Document Summary
Common stock: ownership shares in a corporation. Primary market: market for the sale of newly issued securities. Secondary market: market in which previously issued securities are traded among investors. Electronic communication networks (ecns: computer networks that connect traders with each other. Limit order books: recorded if an order cannot be executed immediately. Dividend yield: how much dividend income you would receive for every invested in the stock, current price = most recent dividend paid / market price per share. Book value: net worth of the firm according to the balance sheet. Book value of a firm"s equity: generally less than the market value of the firm"s equity, can be calculated from the balance sheet as assets minus liabilities. Includes book value of common stock and retained earnings. Liquidation value: net proceeds that could be realized by selling the firm"s assets and paying off its creditors.
