Ratios are provided through online brokers for free for account holders PRICE TO BOOK/The ratio of the current price per share divided by book value per share. The book value measures the value of the shareholders ownership in the company, as measured by the last full year balance sheet. The price to book ratio is usually greater than one as the market value will usually exceed the balance sheet value attributed to the assets of the company. This is because assets are generally recorded at their original cost, less any accumulated depreciation. The market, on the other hand, is concerned with the cash-generating ability of the companys assets rather than its historical cost. If an asset can generate returns in excess of its cost of capital, then a premium will be paid for the asset. This premium is the price to book ratio. PRICE/EARNINGS RATIO Ratio of the stock's P/E to its prospective earnings per share growth rate. In general, the P/E should equal the long-term growth rate in percent. A ratio of one is considered to represent fair value and a ratio greater than one indicates a more "expensive" stock. This ratio is a useful high level check to see whether the P/E is justified. PEG is not as comprehensive a measure as our Aspect Value Rank as it does not factor in interest rates or risk factors. Lower interest rates, for example, would justify a higher P/E ratio but would not necessarily change the growth prospects for a company. This could lead to a PEG ratio greater than one but leave the company fairly valued under the Aspect Value Rank. Suggest you sign up with etrade or commsec
GTP Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
