New answers tagged stock-valuation
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Okay, I realize this is an old post, but I'll throw in some comments about how professionals use depth charts, in case some readers find this information useful.
The key idea that you have to understand is:
Market orders match against limit orders.
What you see in the depth charts are limit orders on the book in the form of bids and asks. When you see a ...
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Apple offers share options as an incentive for its employees. When the employees exercise the options, the shares have to come from somewhere.
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10-yr Treasury Rate image posted from Macrotrends, attribution requested.
The simplest answer is to look at stock yields (i.e. dividends) and see how they compete. If I can get 8-10% in a government guaranteed security ('riskless' if held to maturity, except for inflation), vs, say 2-3% in stocks, with hopes of better returns, but no guarantee. i.e. the ...
answered Jan 12 at 11:52
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The inverse of the P/E is the earnings yield, which is somewhat analogous to the interest rate on a bond. Interest rates have been generally falling for the past several decades, sometimes attributed to a "savings glut". Stocks and bonds compete as investments; when bonds' yields fall and prices rise, so often do stocks'. Another viewpoint is that bond ...
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After-tax profit margins were once common at about 5%. Now they are common at 8% to 10%. Corporate earnings did increase.
Something else to look at is the debt-to-equity ratio.
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Let's consider a scenario where a company has 100 shares out in the stock market.
Mr. Millionaire has purchased up 80 of these shares, and has made it clear that he does not predict that the price will go down. He's also vowed to buy any shares that are available this time next year, no matter the price-- but right now he's focusing on other matters.
A ...
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Remember that the current price is representing the markets expectations for current and future performance; not taking any past information into account - hence the 20 years downturn is irrelevant.
Also the analyst’s buy-recommendation is based on the fact that they believe the company is going to perform better in the future than the market thinks. Again ...
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Your model is fine, it is your assumptions that are incorrect.
The steady state growth rate (i.e. for all eternity) cannot be higher than WACC, both mathematically (as it may give negative EV) but also logically.
If your growth rate is larger than the cost of capital (i.e. WACC) the company would grow into infinity and in the end ending up being the ...
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The net profit reported by Shares magazine is in fact the share capital as you have noticed. They are not the same thing. Net profit is income minus expenses. Share capital is the amount of capital raised through share issuance.
Some intangible assets may be covered by capex (e.g. R&D, software development, etc.)
On depreciation and amortization, your ...
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