3 CASH FLOW, PROFITABILITY AND GUIDELINES FOR VALUING SHARES OF LISTED FINANCIAL INDUSTRY GROUPS IN THE STOCK EXCHANGE OF THAILAND
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Abstract
This research aimed to study 1) cash flow and profitability that affect the valuation of shares in the financial industry groups, and 2) guidelines for valuing shares of stocks in the financial industry groups listed on the Stock Exchange of Thailand. The sample groups studied were the financial industry groups listed on the Stock Exchange of Thailand 2018-2022, totaling 14 companies. Data was collected using information from the website of the Securities and Exchange Commission of Thailand, namely financial statement data from the SETSMART system database. Data was analyzed using stepwise multiple regression analysis. The research findings were as follows:
- 1. Cash flow from operating activities (CFO) is on average in the negative direction whereas cash flow from investing activities (CFI) is on average in the negative direction. Cash flow from financing activities (CFF) on average is in a positive direction due to the business expansion phase. The return on equity (ROE), return on assets (ROA), and net profit margin (NPM) are at a high level. The stock price (Price), dividend yield (DY), market price to net profit ratio (PE), and market price to book value ratio (PBV) are in line with other factors in a positive direction.
- 2. Guidelines for valuing shares of stocks in the financial industry groups listed on the Stock Exchange of Thailand include the comparable approach, income approach, asset approach, and other valuation methods including using other financial information that affects a stock's value, such as financial ratios, investment returns, and risk premiums.
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