African Journal of Hospitality, Tourism and Leisure (Aug 2019)
The role of fundamental analysis in determining the market value of hospitality, tourism and company shares.
Abstract
Fundamental analysis is one of the tools to study all the factors that affect the economic situation of the state on the forces of presentation and painting of its currency by measuring the state of economic growth, inflation, interest rates, industrial and service capabilities, labor market, unemployment rates, political stability of the state and of for example, the hospitality and tourism industry .In this paper we reviewed the theoretical foundations of fundamental analysis and the concept, advantages and disadvantages of fundamental analysis and the tools of fundamental analysis also The role of fundamental analysis in determining the market value of company shares, as well as the practice of its application in Russia. Fundamental analysis takes into consideration the company’s revenues and future dividends, the expectations for future interest rates and the company’s risk assessment to provide the most accurate estimate of the company's share price. Ultimately, it attempts to determine the present discounted value of all payments which a shareholder will receive per share. If this value exceeds the share market value, a fundamental analyst will recommend buying it. A conclusion was made that the main advantage of fundamental analysis is its focus on long-term investment and this type of analysis is focused on strategic investors and such investors are critically needed in the global tourism and hospitality industry.
