I-Hui's Blog

Business Strategic Research

April 2nd, 2012

Tobin’s q Analysis – Should investors buy their stocks?

The Tobin’s q was examined as an indicator of the firm’s effectiveness from an investment perspective across a variety of top management games. It was developed by James Tobin (Tobin 1969) as the ratio between the market value and replacement value of the same physical asset: First, the numerator is the market valuation: the going […]