paid on the market

English translation: the high values of their shares and the high prices paid for them on the stock market

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English term or phrase:	paid on the market
Selected answer:	the high values of their shares and the high prices paid for them on the stock market
Entered by:	Charles Davis

22:54 Feb 23, 2017

English language (monolingual) [PRO]
Marketing - Finance (general) / flyer

English term or phrase: paid on the market

... the cash-flow model does not justify the high values of companies that are paid on the market ....
I don't get the meaning of the word "paid" in this context - is it a financial jargon? Thank you!

Claudia Coja KudoZ activity Questions: 540 (8 open) (16 without valid answers) (53 closed without grading) Answers: 1847
Local time: 06:34

the high values of their share and the high prices paid for them on the stock market

Explanation:
Since no one else has answered the question, I will formalise my discussion comment as an answer. As I said, I am sure that the key to this is that "paid" does not refer to "companies", as it appears to at first sight, but to "values": that is, it is not talking about companies that are paid on the market, but about high values (of companies) that are paid on the market. The market must be the stock market.

It is confusingly expressed because you do not normally talk about paying high values, but rather high prices. That is what it really means. The high values of companies means their high share values. For shares with a high value one pays a correspondingly high price. "Paying values" is a loose expression and not strictly correct, but it is not unknown:

"Therefore, all the academic studies show, not surprisingly, that there is a meaningful discount applied to the values paid for shares if they are part of a minority position in the company."
http://www.jacobscapital.net/all-shares-are-not-created-equa...

"Financial-advice firms dealing in that milieu consistently win “a good multiple,” Mr. Adolf said, referring to the high values paid by the market."
http://www.investmentnews.com/article/20150701/FREE/15063998...

I think the writer has used the expression "high values" because it follows on from the first part of the sentence, which is about share value. The sentence is saying that the companies in question are overvalued; the high value of their shares, for which people are paying a correspondingly high price on the market, is not justified by their cash flow. As I said in the discussion, this could refer to discounted cash flow, one of the instruments investors use to determined whether stocks are overvalued or undervalued. Or it could just mean current cash flow.

Selected response from:

Charles Davis
Spain
Local time: 06:34

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SUMMARY OF ALL EXPLANATIONS PROVIDED

4 +3

the high values of their share and the high prices paid for them on the stock market

Charles Davis

3 +1

pagadas en el mercado

María

Discussion entries: 13

dkfmmuc

Paid on the market directly leads

10:05 Feb 24, 2017

back to the beginning of the 2000s years. At that time investors and also small investors paid exorbitant sums for companies which never made profit.

The cash-flow evaluation for 1,2,3 years with the given result of zero would have been also zero. But investors only bough a "story" of a new industrial revolution.

In that context ist is understandable to use the term "high values of companies that are paid on the market". However IMHO the wording of the source is not fine.

The author could use terms like overvalued or low intrinsic value compared with etc.

So you may ask the customer (if the text hasn't been published yet). If it is we have to live with the present wording.

mrachidi

United States

04:38 Feb 24, 2017

I agree with Claudia. We have a misplaced modifier in this case. The "that" clause must be closer to the word it modifies, which is "values." Only then it will convey the intended meaning.

Claudia Coja

ASKER

@Charles

00:45 Feb 24, 2017

Thank you very much, the explanation is really helpful!

Charles Davis

Spain

@Claudia

00:42 Feb 24, 2017

I think the key to this is that although it seems to be talking about companies that are paid on the market, it's actually talking about high values that are paid, meaning the high prices of the stock of those companies resulting from the high values attributed to them.

So the syntax goes like this:
| the high values of companies | that are paid on the market

Not like this:
| the high values | of companies that are paid on the market

In other words, I think it is simply saying that the companies in question are overvalued on the market. The value of their stock is of course determined by what people are prepared to pay for it. So although "paying high values" is loosely expressed, it is sometimes said; it means paying the high prices resulting from a high valuation.

Cash-flow probably means discounted cash-flow (DCF), which is one of the standard tools for assessing whether stocks are overvalued or undervalued. So when it says that DCF "does not justify" the high values of these companies, it means DCF indicates that those companies are overvalued, so the prices being paid for their stock are not justified.

Claudia Coja

ASKER

@JackMark

00:38 Feb 24, 2017

Thank you so much for the explanation - now I got the idea ;)

Jacek Kloskowski

United States

00:37 Feb 24, 2017

IMO, I understand this as follows: the companies (and in turn the company founders) are paid (in terms of inflating the value of the stock they own) due to inflated "pre-money" stock valuation "on the market" as a result of strong investor's (angel investors and VC's) sentiment to invest in companies with the "innovative and scalable model", with potential for "new markets" and "convincing founder/fouding team".

Claudia Coja

ASKER

@JackMark

23:56 Feb 23, 2017

Could you indicate a synonym in the context for the word "paid" or for the expression itself?

Jacek Kloskowski

United States

23:55 Feb 23, 2017

What is pre-money valuation: http://ownyourventure.com/content/dialogs/preMoney.html

Jacek Kloskowski

United States

23:52 Feb 23, 2017

it seems it is about startup companies whose pre-money valuation (on the market) is overestimated due to the market competition of high-risk investors willing to invest. Hence they are "paid on the market" or "paid what the market will bear"

Claudia Coja

ASKER

@philgoddard

23:35 Feb 23, 2017

I 've sent you the context, too. Thank you!

philgoddard

United States

23:22 Feb 23, 2017

Please share it with all of us!
It looks like bad writing - I don't think it's jargon. They probably mean that companies are being sold for unrealistically high prices.

Claudia Coja

ASKER

@JackMark

23:11 Feb 23, 2017

I've sent you a message :)

Jacek Kloskowski

United States

23:03 Feb 23, 2017

What is the complete sentence?

Answers

12 hrs confidence:

peer agreement (net): +1

pagadas en el mercado

Explanation:
Hola,

Yo lo traduciría así: ... el modelo de flujo de caja no justifica los altos valores que se pagan por las empresas en el mercado ....

Me falta el contexto. No sé si se refiere a los altos valores de las empresas en bolsa o a los precios altos que pueden alcanzar algunas empresas en el mercado cuando se venden.

Example sentence(s):

[...] services, as well as, in the case of owned or granted property, the rental value that would be paid on the market for a dwelling similar to that occupied (imputed rent).
como, en los casos de vivienda en propiedad o cedida, el valor del alquiler que se pagaría en el mercado por una vivienda similar a la ocupada (alquiler imputado).

María
Spain
Local time: 06:34
Specializes in field
Native speaker of: Spanish

12 hrs confidence:

peer agreement (net): +3

the high values of their share and the high prices paid for them on the stock market

Charles Davis
Spain
Local time: 06:34
Native speaker of: English
PRO pts in category: 82

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