Wednesday, April 23, 2008

Investment ratios available on the Reuters

This is the list of ratios available on the Reuters. As an example you can look at the ratios for Microsoft on Reuters.

Valuation Ratios
P/E Ratio
Price to Sales
Price to Book
Price to Tangible Book
Price to Cash Flow
Price to Free Cash Flow

Dividends

Dividend Yield
Dividend Yield - 5 Year Avg.
Dividend 5 Year Growth Rate
Payout Ratio

Growth Rates
Sales (MRQ) vs Qtr. 1 Yr. Ago
Sales (TTM) vs TTM 1 Yr. Ago
Sales - 5 Yr. Growth Rate
EPS (MRQ) vs Qtr. 1 Yr. Ago
EPS (TTM) vs TTM 1 Yr. Ago
EPS - 5 Yr. Growth Rate
Capital Spending - 5 Yr. Growth Rate

Financial Strength

Quick Ratio (MRQ)
Current Ratio (MRQ)
LT Debt to Equity (MRQ)
Total Debt to Equity (MRQ)
Interest Coverage (TTM)

Profitability Ratios
Gross Margin (TTM)
Gross Margin - 5 Yr. Avg.
EBITD Margin (TTM)
EBITD - 5 Yr. Avg.
Operating Margin (TTM)
Operating Margin - 5 Yr. Avg.
Pre-Tax Margin (TTM)
Pre-Tax Margin - 5 Yr. Avg.
Net Profit Margin (TTM)
Net Profit Margin - 5 Yr. Avg.
Effective Tax Rate (TTM)
Effective Tax Rate - 5 Yr. Avg.

Management Effectiveness
Return On Assets (TTM)
Return On Assets - 5 Yr. Avg.
Return On Investment (TTM)
Return On Investment - 5 Yr. Avg.
Return On Equity (TTM)
Return On Equity - 5 Yr. Avg.

Efficiency
Revenue/Employee (TTM)
Net Income/Employee (TTM)
Receivable Turnover (TTM)
Inventory Turnover (TTM)
Asset Turnover (TTM)

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Thursday, April 17, 2008

What is PEG ratio?

PEG ratio is PE Ratio divided by EPS growth. The lower PEG ratio the better. PE ratio can be from different periods (one year or more). It is important to notice that both PE and EPS ratio are projections, not statistical data from previous period. Therefore, PEG ratio might not be accurate. Usually, if PEG ratios is less than 1, that means that the stock is undervalued. Similarly, PEG ratio is greater than 1 means that the stock is overvalued.

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Sunday, April 13, 2008

What is Price to Book Ratio?

Price to Book Ratio is defined as (Current Price of a share) / (Book Value of a share). The Current Price of a share is the current price on stock market, while the Book Value of a share is the value of a share stated in the annual report. After liquidation of the firm and selling every brick, in theory, you should get book value. Therefore, the Current Price should be greater then Book Value, but that is not always true. If you want to compare two firms you could check Price to Book ratio. Smaller PB Ratio could be mean that the firm is undervalued. It is important to notice, as with other ratios, it makes sense to compare PB Ratios of two firms within the same industry. Different industries might have different PB Ratios. The Current Price of a share could be found on the stock market (NASDAQ), and the Book Value of a share could be found on the site of US Securities and Exchange Commission

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