An Equivalent Form of the Residual Income Valuation Model
6 Pages Posted: 24 Feb 2004
Date Written: March 3, 2004
Abstract
The purpose of this note is to show that if clean surplus is assumed, Easton's model (2004) can be viewed as an equivalent form of the residual income valuation model (RIVM). While Easton's model does not require clean surplus and there are problems with the clean surplus assumption (Ohlson, 2003), the fact that his model can be derived directly from the RIVM is of interest.
Keywords: residual income valuation model, estimators of IRR
JEL Classification: G12, M41
Suggested Citation: Suggested Citation
Brief, Richard P., An Equivalent Form of the Residual Income Valuation Model (March 3, 2004). Available at SSRN: https://ssrn.com/abstract=507562 or http://dx.doi.org/10.2139/ssrn.507562
Do you have negative results from your research you’d like to share?
Feedback
Feedback to SSRN
If you need immediate assistance, call 877-SSRNHelp (877 777 6435) in the United States, or +1 212 448 2500 outside of the United States, 8:30AM to 6:00PM U.S. Eastern, Monday - Friday.