What is the meaning of PS in stock market financial statements 丿
PS in stock market financial statements means: price-to-sales ratio The price-to-sales ratio is a new concept that has emerged in the securities market.
Price-to-sales (PS) ratio, PS = total market capitalization divided by revenue from main business or PS = share price divided by sales per share. The lower the price-to-sales ratio, the greater the investment value of the company’s stock.
Revenue analysis is a crucial step in evaluating a company’s business prospects. Without sales, there can be no revenue. This is also a market ratio that has emerged in the international capital market in the last two years, mainly used for companies on the Growth Enterprise Market or high-tech companies. Companies listed on the NASDAQ market are not required to have an earnings performance, so the P/E ratio cannot be used to make a judgment on the value or risk of stock investment, which is instead judged by this indicator.
At the same time, using this indicator to select stocks in the domestic securities market can eliminate those stocks (listed companies) whose P/E ratios are very low, but whose main business does not have core competitiveness, but mainly relies on non-operating gains and losses to increase profits. Therefore, this indicator not only helps to examine the stability and reliability of the company’s earnings base, but also effectively grasp the quality level of its earnings.
The advantages of the price-to-sales ratio are mainly:
(1) It does not have a negative value, and a meaningful value multiplier can be calculated for loss-making companies and insolvent companies;
(2) It is more stable and reliable, and is not easy to be manipulated;
(3) The income multiplier is sensitive to changes in pricing policy and corporate strategy that can reflect the consequences of such changes.
The disadvantages of the price-to-sales ratio are mainly:
(1) It cannot reflect the changes in costs, which is one of the important factors affecting the cash flow and value of the enterprise;
(2) It can only be used for the comparison of the same industry, and the comparison of price-to-sales ratios of different industries is meaningless;
(3) Listed companies are more associated sales, and this indicator also cannot exclude the influence of related sales.
It is mainly applicable to the service enterprises with lower cost of sales ratio, or the enterprises in traditional industries with similar cost of sales ratio.
The formation of the denominator of the main business income is more direct, avoiding the complex and tortuous formation process of the net profit, and the comparability is also greatly improved (limited to companies in the same industry). This indicator is most suitable for some industries with relatively stable gross profit margins, such as utilities and retail merchandise.
What is the meaning of pspbpe as well as peg in the stock market“
PS: PerformanceShare (PerformanceShare, or PS for short) PS, is the meaning of the market-to-sales ratio, the market-to-sales ratio = total market capitalization / sales revenue.
PE: Price/EarningsPrice/EarningsRatio is also called PER, Price/EarningsRatio, Price/EarningsRatio, Price/EarningsRatioPrice/EarningsRatio reflects the market’s view of the profitability of the company. The higher the P/E ratio, the more optimistic the market is about the future of corporate earnings. For investors, stocks with low P/E ratios are more attractive.
However, in a well-informed financial market, stocks with low P/E ratios are rare. It is impossible to pick stocks based on P/E ratios alone. Investors can use the RateofEPSGrowth to compare with the P/E ratio. For a growing company, if its share price is reasonable, the EPS growth rate will be about the same as the P/E ratio. Formula: P/E Ratio = Share Price / EPS. If the company’s earnings per share is 5 dollars, the share price is 40 dollars, the price-earnings ratio is 8 times.
PB: Price/Bookvalue:Average price/bookvalue share price/book value where book value means: total assets – intangible assets – liabilities – preferred stock equity; it can be seen that the so-called book value, is the value of the company is dissolved and liquidated. Because if the company is liquidated, then the debt has to be paid first, and the intangible assets will cease to exist, and one of the preferences of the preferred stock is to share the money first in the liquidation. But there are no preferred shares in this stock market, and if the company makes a profit, then basically no one is going to liquidate. Thus, by replacing book value with net assets per share, the PB would be the same as what everyone understands as the price-to-book ratio.
PEG indicator (price-earnings ratio relative to earnings growth ratio) This indicator is the company’s price-earnings ratio divided by the company’s earnings growth rate. At the time he was picking stocks, he was picking companies with low P/E ratios and high growth rates, which are typically characterized by a very low PEG.
In the U.S., the PEG level is now about 2, which means that the P/E level in the U.S. is now twice as fast as the company’s earnings growth rate. Whether it’s China’s A-shares or H-shares and Chinese companies that issue ADSs, their PEG levels are probably about the same as 1, or a little bit higher than 1.
What does PS, PE, PB mean in finance (or stock market) speak? How to measure their good and bad?
1. PS is price-sales ratio.
The basic meaning of price-sales ratio is to get the company’s sales revenue per share, investors need to pay how many times the market price.
Both in mature and emerging markets, stocks with low price-to-sales ratios can achieve above-average (risk-adjusted) yields, i.e., they can achieve excess yields. Not only that, but this superiority of price-to-sales models is much more consistent and pervasive than price-to-earnings and price-to-book models. Therefore, it can be said that the price-to-sales ratio is the best and most consistent predictor of future returns.
2. PE is price-earnings ratio.
Price-to-earnings ratio, also known as P/E ratio, is the ratio of stock price divided by earnings per share. The market widely talked about the price-earnings ratio usually refers to the static price-earnings ratio, which is usually used as an indicator to compare whether stocks at different prices are overvalued or undervalued.
The price-earnings ratio reflects how many years a stock’s investment can be fully recovered through dividends when the dividend payout ratio is 100 percent and the dividends are not reinvested, provided that earnings per share remain unchanged. In general, a stock price-earnings ratio is lower, the lower the market price relative to the profitability of the stock, indicating that the shorter the payback period, the lower the investment risk, the greater the investment value of the stock; the opposite is the opposite conclusion.
3, PB is the price-to-book ratio.
PB ratio refers to the ratio of share price per share to net assets per share. PB ratio can be used for stock investment analysis, generally speaking, the lower PB ratio of the stock, the investment value is higher, on the contrary, the investment value is lower; but in judging the investment value should also take into account the market environment at that time, as well as the company’s operating conditions, profitability and other factors.
When evaluating the investment value of stocks by the price-earnings ratio, investors should pay attention to the following three factors:
1, can not simply frame the Chinese stock market rational price-earnings ratio of the region, the advantages and disadvantages of the investment project, only in comparison with each other can be determined, there is no absolute indicator, that is, more than the indicator is superior, and less than the indicator is inferior. The examination of the price-earnings ratio can not be separated from the market interest rates in a particular economic environment. When the market interest rate is lower, the price-earnings ratio can be appropriately high but still have investment value;
When the market interest rate rises, even if the original reasonable price-earnings ratio will become unreasonable, due to the differences in market interest rates between different countries there may be, therefore, can not be a simple horizontal reference to the Chinese stock market to frame a rational price-earnings ratio area.
2, do not over-estimate the role of the price-earnings ratio indicator for investment value assessment. Price-earnings ratio is a static indicator, it can only illustrate a single period of investment returns.
And stock investment as a kind of equity investment, with long-term characteristics, the evaluation of its investment value, not only to take into account the current investment income, but also take into account the future period of investment income, and the price-earnings ratio index in this regard there are serious flaws. When choosing stocks to invest in, you can’t rely solely on the price-earnings ratio.
3, the price-earnings ratio indicator must also be combined with the level of risk of the stock, in order to make a reasonable investment value judgment. Stocks with high risk, the rate of return requirement will be correspondingly higher, reflected in the price-earnings ratio, in other conditions are the same, should be lower than other stocks. Therefore, when making investment choices between stocks with different risks, you can’t rely solely on the P/E ratio indicator.