Research And Application Of Price Earnings Ratios In The Stock Valuation Of ZT Securities Company

With the further development in Registration System,growing numbers of companies will be able to go public in this way.At the same time,the elimination of bad companies will accelerate,which,in turn,will make the market logic back to "Value Investing".And the reasonable evaluation of stock price is the key to value investment decision-making.Securities companies which are paid attention by investors widely all the time are the main participants of the securities market and play an important role in the stability and development of the securities market.ZT Securities as a full-chartered comprehensive security firm since the first day of its IPO at Shanghai Stock Exchange Market on June 6,2020,the fluctuation of its stock price is also very huge,which reflects that the market price can not respond effectively to its stock value.And the excessive deviation of stock price is not conducive to the stability and development of ZT securities.This study takes ZT securities as a research target,through a comprehensive analysis of ZT securities and combined with the characteristics of the securities industry choosing the P/E valuation method for valuation.The traditional price earnings ratio valuation method has a large deviation from the actual situation,which can not reflect its trend and difference.In this study,our model construction will base on "Regulations on the Classification of Securities Companies",we will use P/E ratio of same-level security company as short-term opportunity costs,and use the entire industry P/E ratio as long-term opportunity costs.Then optimize through the difference of profitability,so as to construct the P/E valuation model.The optimized valuation results are closer to the actual situation,reflecting the development trend and profitability of the company.Finally,according to the valuation results,this study puts forward relevant suggestions on the market value management.It is necessary for listed companies to guide the return of value through market value management to prevent the stock price from excessively deviating from its actual value.Investors should also have a rational judgment on the stock price and avoid blind speculation.Reasonable value evaluation is conducive to the stability of the financial market and further promote the prosperity and development of China’s economy.