imported>Doug Williamson |
imported>Administrator |
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| Shareholder value is the value, or wealth, enjoyed by shareholders.
| | A draft that demands payment immediately, ‘at sight’. |
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| Maximising long-term value for shareholders is a fundamental principle of corporate governance.
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| The term 'shareholder value' describes the general trend away from historical accounts-based measures of performance, and toward economic value-based measures.
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| In simple terms, shareholder value is added or created when the return from the firm's investments exceeds its cost of capital.
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| In other words, when the Internal rate of return from investment projects exceeds the appropriately risk-adjusted Weighted average cost of capital.
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| Shareholder value management emphasises the consequences of management decision-making in terms of resulting market values, rather than in terms of purely accounting-based measures such as accounting profits or earnings per share.
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| Shareholder value calculations take account of:
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| (i) The market value of shares;
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| (ii) Dividends paid out to the shareholders;
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| (iii) Capital introduced by the shareholders; and
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| (iv) Capital returned to the shareholders.
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| == See also == | | == See also == |
| * [[Corporate finance]] | | * [[Time draft]] |
| * [[Corporate governance]]
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| * [[Corporate value]]
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| * [[Cost of capital]]
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| * [[Dilution]]
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| * [[Earnings per share]]
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| * [[Economic value added]]
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| * [[Internal rate of return]]
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| * [[Market value]]
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| * [[Market value added]]
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| * [[Metric]]
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| * [[Multiples valuation]]
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| * [[Shareholder value analysis]]
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| * [[Total shareholder return]]
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| * [[Value driver]]
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| * [[VBM]]
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| * [[Weighted average cost of capital]]
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| [[Category:Corporate_finance]]
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