A measurement of the volatility of a security with the market in general. A greater beta coefficient than 1 indicates systematic risk greater than the market, while a beta of less than 1 indicates systematic risk less than the market. 

Any one of a number of stock valuation models based on the premise that the value of stock lies in the present value of its future dividend stream. 

Any one of a number of stock valuation models based on the premise that a stock's value is some appropriate multiple of earnings per share. 

EBITDA 

Earnings before interest, taxes, depreciation, and amortization. It emphasizes operating income rather than the normally reported earnings after taxes. 

An extra return that the stock market must provide over the rate on Treasury bills to compensate for market risk. It is defined as (KM - RF) or the expected rate of return for common stocks in the market minus the risk-free rate. 

After-tax earnings plus depreciation (and amortization) less necessary capital expenditures and anticipated dividend payments. Free cash flow emphasizes the amount of funds available to redeploy in the business or to be used for acquisitions. 

A company that exhibits rising returns on assets each year and sales that are growing at an increasing rate (growth phase of the life-cycle curve). Growth companies may not be as well known as growth stocks. 

The stock of a firm generally growing faster than the economy or market norm. 

Assets that are not readily apparent to investors in a traditional sense, but add substantial value to the firm. 

A statistical methodology to make projections. 

The multiplier applied to earnings per share to determine current value. The P/E ratio is influenced by the earnings and sales growth of the firm, the risk or volatility of its performance, the debt-equity structure, and other factors. 

The total return required on an investment. For common stock, it is composed of the risk-free rate plus an equity risk premium. Once determined, it becomes the discount rate applied to future cash flows. 

The percentage of earnings retained in the firm for investment purposes. 

The required rate of return before risk is explicitly considered. It is composed of the real rate of return plus a rate equivalent to inflationary expectations. It is referred to as RF. 

A model that looks at how much growth a firm can generate by maintaining the same financial relationships as the year before. The interaction between return on equity and the retention of equity for reinvestment is considered. 

The process of attributing a value to a security based on expectations of the future performance of the issuing concern, the relevant industry, and the economy as a whole.