Faculty Scholarship 1994 - Present

Usefulness of Book Value in Equity Valuation: Evidence from the Taiwan Stock Exchange

This study investigates the usefulness of book value in equity valuation for firms listed in the Taiwan Stock Exchange. Results show that (1) book value is a significant explanatory variable of firm value in simple linear form, and (2) the piece-wise linear models suggest that values of Taiwanese firms are determined by book value alone for firms with negative earnings and book value, and by both earnings and book values for firms with positive earnings and book value.