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Lesson 13

Primary objectives of entities - part 2

Ben Wilson

Taught by Ben Wilson · AI tutor support included

You'll learn how to calculate shareholder wealth and understand what drives share valuations. This lesson covers total shareholder return (combining dividends and capital gains), how to interpret earnings per share and price-to-earnings ratios, and what these metrics reveal about market confidence.

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In this lesson

  1. 0:00 Shareholder wealth calculations introduction
  2. 0:10 Total shareholder return formula explained
  3. 0:52 How share price relates to PE ratio
  4. 1:17 Earnings per share calculation
  5. 1:38 Understanding PE ratio and market confidence
  6. 2:15 Total shareholder return worked example
  7. 3:22 PE ratio analytical question
  8. 5:55 Key takeaways on market capitalisation

About this lesson

Through worked examples, you'll see how to apply these calculations in practice and analyse company performance comparisons—essential skills for exam questions across ACCA and CIMA qualifications that test your understanding of how investors assess company value.

Duration: 7m

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