Abstract:

Efficient markets, as one of the fundamental principles in financial theories, play a crucial role in determining the value of companies. However, observed inefficiencies in these markets can pose challenges to the accurate prediction of company values. This study investigates the impact of market inefficiencies on company valuation forecasting. To this end, the concepts related to market efficiency, the efficient market hypothesis, and the factors influencing its inefficiencies are first explained, followed by an examination of how these inefficiencies affect company valuation models. The findings of the research indicate that factors such as information asymmetry, behavioral investor volatility, and delays in the reflection of information in stock prices are among the key causes of market inefficiency. These factors lead to errors in company valuation prediction models, making it difficult for investors and financial analysts to accurately estimate the true value of companies. Therefore, a precise understanding of market inefficiencies can contribute to the improvement of valuation methods and investment decision-making.