Valuation Research According To The Theory Of EVA And Real Option

With the gradual opening and development of the Chinese financial industry, the Chinese capital market will be gradually mature and the value based investment will be predominant in the future. But many currently popular valuation methods are difficult to explain the phenomenon that the price of a company deviates from its value in the Chinese stock market over a long period of time. On such a background, this thesis analyses the axiom and connotation of EVA (Economic Value Added) valuation and options pricing in detail basing on exploring the formation and estimating of firm value. The main contents of the thesis are to use DCF (Discounted Cash Flow) model for reference of the valuation basing on EVA and options. Then the thesis introduces the mechanism inside and evaluating process of the integrated model particularly. On the basing of applying the model on the intrinsic valuation of listed company, the thesis analysis the computation with regression. We can get the conclusion that the integrated model can be used in firm value and value enhancement. The thesis draws a proof from Inner Mongolia Yili Industrial Group CO. LTD. which appears on market. Economic value added (EVA) won't move violently because of taking no account of the cash flow of the investment but the cost of invests. So the flow of EVA changes gently and is easy to predict through statistics method. And option pricing considers the flexibility of investment. So valuation model according to theory of EVA and option can estimate the firm value more accurately and objectively than other models.Through the research and arguments, the writer thinks that the index sign of EVA synthesizing the legal right capital cost and the ownership of a share capital cost. And real option considers the potential chance for a company. So the model can offer the real economic profits of a company and can evaluate the listed company management accomplishment correctly and completely.The stock price's performance of the company is basing on its intrinsic valuate and the reasonable expectation of investors. The valuation model basing on EVA and real option provided a competent index sign with analytical investment, and can become...