Present Value of Growth Opportunities PVGO.

Present Value of Growth Opportunities (PVGO) is a concept that gives analysts a different approach to equity valuation. PVGO stands for present value of growth opportunities and it represents the component of a company's stock value that corresponds to the investors' expectations of growth in earnings.
✔️Accounting students and CPA Exam candidates, check my website for additional resources: farhatlectures.com/
📧Connect with me on social media: linktr.ee/farhatlectures
#PVGO #CPAREVIEW #presentvalueofgrowthopportunities.
Considering that valuation in stock markets is a combination of fundamentals and expectations, we can break down the value of a stock to the sum of (1) its value assuming no earnings reinvested and (2) the present value of growth opportunities.

[@huongnguyenthu2462]

Hi, professor i have a question abt the last example at 14:26. I think the equation must be P0 = 2/(12.5%-12%)=400.
Please fix me if i’m wrong.

[@lwljyl8447]

you are right. it was a typo in Professor's handwriting. should be 2/(12.5%-12%)=400 rather than 5/(12.5%-12%)=400

[@user-xv8yz5tp2t]

Typo issue yes

[@thokozanisiyabonga2752]

Hi, Professor please make more of these they are really helpful..., please next time try to show how to calculate these ratios from a given sophisticated financial statements.....

[@Kamaleido02]

hi professor, pretty sure you made a mistake at 15:50 because plowback ratio is 0 and you put it as 0.6