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The price-to-book ratio, or P/B ratio, (also PBR) is a financial ratio used to compare a company's current market value to its book value (where book value is the value of all assets minus liabilities owned by a company). The calculation can be performed in two ways, but the result should be the same.
The return on equity (ROE) is a measure of the profitability of a business in relation to its equity; [1] where: . ROE = Net Income / Average Shareholders' Equity [1] Thus, ROE is equal to a fiscal year's net income (after preferred stock dividends, before common stock dividends), divided by total equity (excluding preferred shares), expressed as a percentage.
The jaws ratio is a measure used in finance to demonstrate the extent to which a trading entity's income growth rate exceeds its expenses growth rate, measured as a percentage. A larger positive value demonstrates that a trading entity is effectively generating more income over time than it is generating expenses, thereby potentially increasing ...
As an example, if you’re considering a project that requires an initial investment of $100,000 and is expected to generate future cash flows with a present value of $120,000, the PI would be 1.2 ...
Liquidity ratios measure the availability of cash to pay debt. [3] Efficiency (activity) ratios measure how quickly a firm converts non-cash assets to cash assets. [4] Debt ratios measure the firm's ability to repay long-term debt. [5] Market ratios measure investor response to owning a company's stock and also the cost of issuing stock. [6]
All the ratios listed above can be written as industry averages (something) such as industry averages profitability ratio, represents for the average figures of profitability ratio for a certain industry. [18] Through compare those ratios of a business with the industry averages could obtain its position within the industry.
However, sales do not reveal the whole picture, as the company may be unprofitable with a low P/S ratio. Because of the limitations, this ratio is usually used only for unprofitable companies, since they don't have a price–earnings ratio (P/E ratio). [2] The metric can be used to determine the value of a stock relative to its past performance.
Earnings per share (EPS) is the monetary value of earnings per outstanding share of common stock for a company during a defined period of time. It is a key measure of corporate profitability, focussing on the interests of the company's owners (shareholders), [1] and is commonly used to price stocks.