Valuation (redirected from valuating)

Valuation

Determination of the value of a company's stock based on earnings and the market value of assets.

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valuation

A process for calculating the monetary value of an asset. Valuation is subjective and results in wide disparities for the values of most assets.

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Valuation. Valuation is the process of estimating the value, or worth, of an asset or investment.

Sometimes it means determining a fixed amount, such as establishing the value of your estate after your death. Other times, valuation means estimating future worth.

For example, fundamental stock analysts estimate the outlook for a company's stock by looking at data such as the stock's price-to-earnings (P/E), price-to-sales, and price-to-book (net asset value) ratios.

In general, a company with a high P/E is considered overvalued, and a company with a low P/E is considered undervalued.