Comparison of Market based and Ohlson Models in Firm's Equity Valuation Listed in Tehran Stock Exchange

This paper is seeking to the valuation model which the obtaind value would be most similar to the market value of listed companies in Tehran Stock Exchange. In this regard, four valuation models inclues residual income valuation model, price to earnings ratio, adjusted present value and Free Cash Flow to Equity models were compared with Ohlson valuation model. Since a company's market value is not fixed and can change during the periods, three alternative variables defined to the market value. These proxies are the highest and the lowest, highest and lowest and average market value during the year. The accuracy of models based on the criteria Median Absolute Percentage Error and waste significant regression models were compared. There are significant differences between the median absolute error test different models ANOVA and Pearson correlation test was used. The results show that in the 95% accuarcy interval the discounted free cash flow and pricing to earnings models provide the most accurate estimates of market price. While Finally, Ohlson is the least accurate. In general these results with the results of studies in other stock markets around the world are in conflict.