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If the intrinsic value of a stock is greater than its market value, which of the following is a reasonable conclusion?

 

The stock has a low level of risk.

 

The stock offers a high dividend payout ratio.

 

The market is undervaluing the stock.

 

The market is overvaluing the stock.

Accounting ERP Audit Management Business Development Management
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Question added by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company
Date Posted: 2015/03/24
Upvote (2) Views (35) Followers (13) Answers (13) Report Question
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Wasi Rahman Sheikh
by Wasi Rahman Sheikh , WAREHOUSE SUPERVISOR , AL MUTLAQ FURNITURE MFG

Correct answer is The market is undervaluing the stock.

Tegegne Abrham
by Tegegne Abrham , General Manager , MM BEDDING INDUSTRIES PLC

The answer is D but why? The intrinsic value of a share is measured by discounting future cash flow of the of the company from its operation. This may not be reflected in the investors measurements of EPS or P/E ratio used to valuation of shares. In this case the intrinsic value of shares will become higher than the market value

Muhammad Ramzan Tufail ACCA
by Muhammad Ramzan Tufail ACCA , Assistant Finance Manager , Eltizam Asset Management Group

Correct Ans is.

 

The market is undervaluing the stock.>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

Deleted user

The market is undervaluing the stock.

Alex Al Yazouri
by Alex Al Yazouri , General Manager , Al Mushref Cooperative Society

>>>>>>>>>>>>>The market is undervaluing the stock.

Taiwo Atanda
by Taiwo Atanda , Finance Business Partner , Honeywell Flour Mills Plc

The market is undervaluing the stock...................................................................................................

Abd El Rahman Mamdouh
by Abd El Rahman Mamdouh , Study and Proposal (Presales) Manager - ICT solutions , BTC : Baud Telecom Company

the right answer :The market is under-valuing its stock value

 

Mir Mujtaba Ali
by Mir Mujtaba Ali , Internal Audit Manager , Confidential

The market is undervaluing the stock.>>>>>>>>>>><<<<<<<<<<<

Mohammed Shahid Ullah
by Mohammed Shahid Ullah , Executive Director (Finance) , Coal Power Generation Company Bangladesh Limited

The intrinsic value of a stock is greater then its market value, that means market is undervaluing the stock.

Emad Mohammed said abdalla
by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company

>>>>>>>>>>> The market is undervaluing the stock.

Hemant Uttwani
by Hemant Uttwani , Accountant

THE MARKET IS UNDERVALUING THE STOCK 

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