COMPANIES WITH SHARE SPLIT OR BONUS ISSUE | The Investment Quadrant by The Fifth Person

Questions › Category: Valuation Quadrant › COMPANIES WITH SHARE SPLIT OR BONUS ISSUE

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Lawrence Tan asked 11 months ago

Hi,
If the Company has history of bonus issue/share split

I remember that we have to use the adjusted price when we plot the valuation chart, e.g. PE.
Do we adjust the EPS for all the years to reflect the bonus issue/share split?

lee jun replied 11 months ago

Hi, if the company has has history of splits, I adjust the EPS to get the refence of today’s value.

Victor Chng replied 11 months ago

Hi Lee Jun,

You just have to adjust the number of outstanding shares

1 Answers

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Victor Chng answered 11 months ago

Hi Lawrence,

The share price when you get from Yahoo Finance should be adjusted for the split already.

You just need to adjust the number of outstanding shares.

Lawrence Tan replied 10 months ago

Thank you Victor.

A quick question: In the excel template (under the numbers tab), do we use the adjusted price or should we use the average price?

Victor Chng replied 10 months ago

For the particular year, you can use the average price.

Lawrence Tan replied 10 months ago

Thank you Victor

Victor Chng replied 10 months ago

Welcome Lawrence :)