@article {Liu53, author = {Zhongming Liu and Daniel J. Borgia and Travis L. Jones}, title = {Valuation of Chinese Equity Based on Implied Growth Rates}, volume = {24}, number = {1}, pages = {53--66}, year = {2015}, doi = {10.3905/joi.2015.24.1.053}, publisher = {Institutional Investor Journals Umbrella}, abstract = {This article introduces a valuation method that can be used to back out the short-term expected growth rate implied in the prices of Chinese stocks. The proposed methodology involves reverse-engineering the traditional DCF models, which is then applied to a sample of 467 listed Chinese companies. Our findings show that the implied growth rate generally is much higher than its actual realization, with all median estimation errors larger than 90\%. This study has practical applications for investors and traders, since it does not require access to private information or analysts{\textquoteright} estimations and provides a useful tool to critically evaluate Chinese stock prices.TOPICS: Fundamental equity analysis, emerging}, issn = {1068-0896}, URL = {https://joi.pm-research.com/content/24/1/53}, eprint = {https://joi.pm-research.com/content/24/1/53.full.pdf}, journal = {The Journal of Investing} }