Research On The Application Of EVA Model In The Value Evaluation Of Listed Companies In The Chinese Medicine Industry

In the stock market, what investors are most concerned about is the comparison of the relationship between the price and the value in listed Corporation and find the chance to invest.Price is very easy to get and understand,but the model of valuation is much more complex and professional.In addition different models have different results in the practical application. Hence,it is of great practical significance to build a model with observable effects and easy to collect effective data.EVA has been widely applied in the developed capital market,which has a high correlation with the share price.Chinese capital market is on the confines between strong validity and weak validity,so the research of EVA on the application in the Chinese capital market is greatly meaningful.On one hand,it helps investors to find the chance to invest;on the other hand it may guide Chinese capital market to develop maturely from speculation to value.The research object of this paper is the listing cooperation in the Chinese medicine industry which has continuous listing price from 2011 to 2014.The traditional medicine is national industry of China,the beta of which is similar to Shanghai composite index,approximately 1.Therefore,the analysis of the medicine industry has a certain representation.Five parts are included,the first is the introduction,which mainly cover the research background and significance, research ideas and methods and the corresponding research framework and it also introduces the related literature and the theoretical foundation of EVA model.The background and reason for adjustment of EVA and the calculation is involved in the second part.Empirical research is made in the third part,in which correlation analysis are tested and the comparison between EVA per share and some traditional accounting index,such as earnings per share,net assets per share and operation cash flows per share.In the fourth part,case study is made with the example of Tong Ren Tang.Fifth part is the conclusion of the paper.Taking Chinese medicine listing companies as the study objects,combined with theoretical,empirical and case studies to promote the application of EVA model in Chinese capital market,witch has a certain practical value.