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Fundamental Analysis And Discounted Free Cash Flow Valuation Of Stocks At Macedonian Stock Exchange

Author

Listed:
  • Ivanovski, Zoran

    (University of Tourism and Management in Skopje)

  • Ivanovska, Nadica

    (Central Cooperative Bank, Skopje)

  • Narasanov, Zoran

    (University of Tourism and Management in Skopje)

Abstract

We examine the valuation performance of Discounted Free Cash Flow Model (DFCF) at the Macedonian Stock Exchange (MSE) in order to determine if this model offer significant level of accuracy and relevancy for stock values determination. We find that stock values calculated with DCF model are very close to average market prices which suggests that market prices oscillate near their fundamental values. We can conclude that DFCF models are useful tools for the companies’ enterprise values calculation on long term. The analysis of our results derived from stock valuation with DFCF model as well as comparison with average market stock prices suggest that discounted cash flow model is relatively reliable valuation tool that have to be used for stocks analyses at MSE.

Suggested Citation

  • Ivanovski, Zoran & Ivanovska, Nadica & Narasanov, Zoran, 2014. "Fundamental Analysis And Discounted Free Cash Flow Valuation Of Stocks At Macedonian Stock Exchange," UTMS Journal of Economics, University of Tourism and Management, Skopje, Macedonia, vol. 5(1), pages 11-24.
    • Handle: RePEc:ris:utmsje:0096
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    Citations

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    Cited by:

    1. Aima Khan & Muhammad Azeem Qureshi & Pål Ingebrigt Davidsen, 2020. "How do oil prices and investments impact the dynamics of firm value?," System Dynamics Review, System Dynamics Society, vol. 36(1), pages 74-100, January.

    More about this item

    Keywords

    valuation; securities; free cash flow; equity; stock-exchange;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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