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Industry Leader Premium

Ja, Kim

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The advantage of becoming an industry leader is widely studied. However, how can we measure it? This paper measures how much premium an industry leader has in its valuation through a P/E ratio. The findings suggest industry leaders have significantly higher P/E ratios by 0.65 than their peers. The analysis of earnings forecasts suggests this is not due to their high earnings growth potentials but from other sources. However, in stock recommendations, the premium is not recognised by analysts but interpreted as the sign of over-valuation. The paper contributes the new structure of a P/E ratio by identifying the industry leader premium.


Ja, K. (2019). Industry Leader Premium. European Journal of Multidisciplinary Studies, 4(2), 84-94.

Journal Article Type Article
Acceptance Date Jun 29, 2019
Online Publication Date Jun 29, 2019
Publication Date Aug 30, 2019
Deposit Date Apr 30, 2020
Publicly Available Date May 1, 2020
Journal European Journal of Multidisciplinary Studies
Electronic ISSN 2414-8385
Publisher European Center for Science Education and Research
Peer Reviewed Peer Reviewed
Volume 4
Issue 2
Pages 84-94
Public URL
Publisher URL


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