Value Investing In Business Valuation

By using value investment theory, this article analyzes the intrinsic value of DongE E-Jiao .The analysis material mainly comes from the company's periodical financial statements. The article is divided into three parts:The first part is an introduction of the theory of value investment. Firstly, it briefly reviews various theories of investment and then it indicates that the value investment theory, which derives from the firm ground theory, would become a dominant investment analysis method. Then it describes what is value investment, including the concept of value investment. The value investment theory is used to analyze companies' intrinsic value according to the following three factors, i. e.these companies' assets, earning capability and growing prospect.By using value investment theory, the second part analyzes the intrinsic value of DongE E-Jiao. This part first introduces the basic information of DongE E-Jiao, including the simple history of the company, its main business, the composition of its income and the financial states since its IPO. Then, this part thoroughly analyzes the competition advantage and development prospect of DongE E-Jiao. According to the above analysis, it evaluates the intrinsic value of DongE E-Jiao by using value investment theory.The third part summarizes the issues about which we should caution in using value investment theory, including the outer environment that value investment needs and the investors' own abilities. This part also gives some methods to cope with value investment theory's weakness.As an analyzing method, value investment theory not only can be used in the analysis of the intrinsic value of listed companies, but also can be used in the analysis of non-listed companies' investment value. The author believes that in the process of establishing and developing the property rights market for domestic firms, the value investment theory will be of great help. The rationality and cautiousness that are advocated by this theory will bear an enlightening effect on the leaders of the companies..