num_pages: 88
description: Earnings Earnings Growth and Value presents a model of earnings and dividends leading up to the core principle that growth in earnings explains the price to forward-earnings ratio. This model is referred to as the OJ (Ohlson and Jeuttner-Nauroth) model. The OJ model takes into account two growth measures of earnings -- the near term and the long term -- to explain the price to forward-earnings ratio. Further the model allows for a broad set of dividend policies. Earnings Earnings Growth and Value starts from the basics and derives the valuation formula which shows how value depends on earnings and their growth. Some of the topics developed here are include dividend policy irrelevancy (DPI) how one extends the model to incorporate an underlying information dynamic accounting rules and their influence on the model and ways in which the model can be extended to reflect operating vs. financial activities. Earnings Earnings Growth and Value should be required reading for researchers in accounting and finance with an interest in accounting theory equity valuation and financial accounting.
language: English
title: Earnings, Earnings Growth, and Value (Foundations and Trends
publisher: Now Publishers Inc