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By Chloe Miller. EBITDA stands for earnings before interest, tax, depreciation and amortisation. It is important because it directly effects the profit figures. So the shares in the market which have the highest EBITDA will most likely have the highest profit.
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By Chloe Miller EBITDA stands for earnings before interest, tax, depreciation and amortisation. It is important because it directly effects the profit figures. So the shares in the market which have the highest EBITDA will most likely have the highest profit. Book Value Per Share is a company’s net worth divided by the company’s outstanding shares. This is important because if it is below 1 the company is worth an investment. A dividend yield is calculated by he dividend divided by the share price. This shows you the return or loss you will make by investing in the company. The previous year’s dividend is important because it gives you a rough insight on how much profit you will make. Enterprise value is a company’s value by taking into account debts. This is important because it gives you useful information whether to invest in the company or not. If it is high the company is worth more. Debt to Market Capitalisation shows how much debt a company has relative to its market value. It is important because if this figure is above 0.5 the company is in a high amount of debt so it is not worth investing in.
James Rickwood Enterprise value (EV) EBITDA A measure of a company's value taking into account net debt or net cash. To know the price of the company if you want to do buy the company you would pocket the cash but take on the debt. EBITDA is Earnings Before Interest, Tax, Depreciation, and Amortisation. This information is useful to compare different companies in the same category as you don't have to deal with tax. Book value per share The most useful application is arguably to help spot when a stock is trading at below its asset value. It is worked out by Dividing the book value by the no. Of shares Earnings per share (EPS) EBITDA Growth Is the companies allocated profit to a certain share if it is low it suggest poor use of companies rescources It is important to know if there is a growth in EBITDA as it could mean you invest in one company rather than the other.
A measure of a companies value, by taking into account debts. This is important because it shows us how much its worth so whether it is worth investing in. This is important because if it is under one it may show that its trading below its asset value, meaning it would be good to buy. This shows the companies money before debts or taxes which helps us because it shows how well the company is performing It shows how much the company is investing for the future, many companies will spend 15% on this. This shows how indebt a company is, relative to its market value. If its over 0.5 its high. By Lucy Horsnell
If the book value is less than 1 the company is usually under valued The announcement of dividends is important because this shows the profit or losses of a company, this can affect the share price of the company because if they make a loss then less people are going to are going to want to investment The amount of free cash flow or debits can affect the share price because if a company has a free cash flow then it can buy companies and expand its business and if it has debit all of their profits are going to be going towards paying those debits off. If the company has scandal or makes an error the share price of the particular company is going to go down because less people are likely to buy the product. E.G Barclays with the Libour scandal, Barclays share price went down 500% .Often, the stock price of the companies in the same industry will move in tandem with each other. This is because market conditions generally affect the companies in the same industry the same way. But sometimes, the stock price of a company will benefit from a piece of bad news for its competitor if the companies are competing for the same market. The introduction of a product can be a big boost for a company share price, if it is good, as the profits of the company will rocket due to everyone buying the new product.byhenryhodgson
Financial information • EBITDA- Earnings before interest, taxes, depreciation and amortization. The EBITDA gives an indication of the current operational profitability of the business. It is used to analyze and compare profitability between companies and industries as it eliminates the effects of financing and accounting decisions. • Book Value per Share- The value of the net assets of a company. If the companies ratio is below one, this means the company is undervalued and may be a good investment. The book value per share formula is used to calculate the per share value of a company based on its equity available to shareholders. • Market Capitalisation- The number of shares X the share price = how much the company is worth, it is the total value of all outstanding shares. This is helpful as it shows the current price of the company, if it is a large company and if it has potential growth • EPS- This is the earnings per share. The portion of a companies profit which is allocated to each outstanding share. This is helpful to shareholders, it lets them know how much money their shares are making. • Dividend per share-The the sum of declared dividends for every ordinary share issued. Dividend per share is the total dividends paid out over an entire year divided by the number of outstanding ordinary shares issued. This is helpful to the shareholders as it gives them an idea of what profit they will make. • Michaela Webber
Wilson Wood Enterprise Value (EV) EBITDA A measure of a company's value taking into account net debt or net cash. Calculated as the market capitalisation plus net debt. This can help you see the companies growth. EBITDA is the figure commonly used to measure a company’s value and how well it performs against other businesses. EBITDA stands for earnings before interest, taxes, depreciation and amortization. Market Capitalisation The total value of all outstanding shares. It's calculated by multiplying the number of shares by the current market price. This term is often referred to as the market cap. This is the value that the company trades at on the stock market. If EBITDA growth exceeds Sales growth this is a good sign as it indicates the firm is becoming increasingly profitable. Book Value per share EPS The most useful application is arguably to help spot when a stock is trading at below its asset value, i.e. the ratio is less than one. This rarely happens, but if it does it could mean that the company is undervalued and might be an attractive buy. Earnings per share. The portion of a company's profit allocated to each outstanding share. This measure is useful as the price of each share, which can be compared to the underlying earnings.
Market capitalisation=amount of shares X share price you we be able to calculate the risk involved. • EV=debt the company has may effect if you want to invest. • Free cashflow= the amount of money available to spend, this means if they have a high cash flow then there is a potential for them investing. • Fiscal year end = tells them how profit they have made, if they have not made much profit be more cautious when investing. • Dividend per share= how much money you make per share
Market capitalisation=amount of shares X share price you we be able to calculate the risk involved. • EV=debt the company has may effect if you want to invest. • Free cashflow= the amount of money avalable to spend, this means if they have a high cash flow then there is a potential for them investing. • Fiscal year end = tells them how profit they have made, if they have not made much profit be more cautious when investing. • Dividend per share= how much money you make per share
Free cash flow = how much cash a company has after paying its bills. • Tip: This show how much the company has to spend/grow. • EBITDA = earnings before interest , tax , depreciation and amortisation. • Tip: This show all the money that was made but not profit. • Book value per share = the perceived value of the company divide by the number of shares. • Tip: This will show you the price of 1 stock. • Net income = total earnings after all costs taken in to account. • Tip: This shows profit • Ev enterprise value = a measurement of the value of the company inc debt and cash. • Tip: this sow how much they have lent. • Joe.pammen
Key Words EBITDA: stands for Earnings Before Interest, Tax, Depreciation, and Amortisation. It is useful for comparing companies within the same sector eg. Tescos, Sainsburiesand Morrisons, the company with the higher EBITDA you would chose. It gives you an idea of how well the company is performing compared to others, the higher the better. For an example BT Group PLC has a high EBITDA. Market Capitalisation: This is the total value of all outstanding shares. The formula- the number of shares x the current market price. This is also known as market cap. This is the value that the company trades at on the stock market. This is helpful to buyers as it tells us the value of the trade. Net Income: A company's total earnings, reflecting revenues adjusted for costs of doing business, depreciation, interest, taxes, and other expenses.This is helpful as you can tell how well the company is doing compared to other companies. EPS: This is the earnings per share. The portion of a company's profit which is allocated to each outstanding share. This helps us to decide whether or not we should buy the company as the measure is useful as it can be compared to the underlying earnings. EV: stands for Enterprise Value. This is the value of a company which includes equity, debt and cash. This is helpful to buyers as it shows the worth of the company with the affect of its stock price. The higher the Enterprise Value the better.
Financial Information: 1: EBITDA- earning before interest, tax depreciation and amortisation. Used to analyse the profitability between companies because it removes the effects of financing and accounting decisions, as it shows how much they are actually making. 2: EV- enterprise value- how much the company is valued at incorporating net debt and/or cash. Useful when comparing companies as it is a more accurate indicator of the companies value than market capitalization. The higher the number the higher the share price will be. 3: Book value per share- the value of the net assets of a company. If a company's ratio is below 1 it means it is undervalued and it may be a good investment. It tells you how much money you would get for each share if the company were to liquidate. 4: Debt to market capitalisation- it is the company's net debt divided by the market capitalisation. A ratio of over 0.5 is high and companies with a high ratio can be volatile. A low ratio indicates the company is in good financial shape and is more likely to grow and expand. 5: Dividend yield- the dividend divided by the price, it is the annual percentage return in dividends on your investment. It indicates the rate of return you can expect to earn on your shares and tells you if it will beat inflation (3%), so if it is 2.5% you will lose 0.5% a year to inflation . Higher than 10% is high and lower than 4% is low, however newer companies often do not pay a dividend or pay a very small 0ne as they are investing in the future of the business. It helps you to decide how valuable owning a particular share is. By Saffron Rabey
EBITDA: Earnings before Interest, Tax, Depreciation, and Amortisation (i.e. revenues less expenses excluding interest, tax, depreciation, and amortisation). As a measure of operational results EBITDA strips out any expense due to depreciation and amortisation. It is useful for comparing companies within the same sector with similar capital intensities (i.e. depreciation/amortisation costs), as it enables investors to avoid distortions due to different accounting treatments of depreciation/amortisation. It gives you an idea of how well the company is performing which helps me use the information. An approximate measure of a company's operating cash flow based on data from the company's income statement. Calculated by looking at earnings before the deduction of interest expenses, taxes, depreciation, and amortization. The formula is: EBITDA = Revenue – Expenses (excluding interest, taxes, depreciation and amortization) Capital Expenditure to Sales: Capital Expenditure divided by sales.The measure gives a sense of how much the firm is investing for the future. When comparing across different companies in the same sector, a lower ratio is not necessarily better. This is because a firm needs to invest to continue to innovate and invent new products for future sales. This is why i wanted to know. The ratio is very dependent on the sector being examined. Some companies are very capital intensive, and continually need to invest in new factories, e.g. the semiconductor industry. A games developer might be expected to invest less, yet it must invest sufficiently to remain competitive in terms of innovation. Many companies will spend c.15% sales on capital expenditure (capex). This is how I can use the information. A payment, or the promise of a future payment. • Market Capitalisation: • The total value of all outstanding shares. It's calculated by multiplying the number of shares by the current market price. This term is often referred to as the market cap. This is the value that the company trades at on the stock market. It is important to note that the price of each share is not meaningful as a guide to the total value of a company unless you know the number of shares in issue. The traded value of a company depends on a multitude of factors but will be heavily influenced by its size (Sales, earnings, cash flow etc.) and its growth prospects. • An amount spent to acquire or upgrade productive assets (such as buildings, machinery and equipment, vehicles) in order to increase the capacity or efficiency of a company for more than one accounting period. Also called capital spending. Free Cash Flow (FCF): Calculated as EBITDA adjusted for working capital, capital expenditure, interest and tax. Ultimately, cash is king, and Free Cash Flow is one of the best measures. It measures how much cash a company has after paying its bills for ongoing activities and growth, this is why i would want to know.Best used as a comparative measure when compared to e.g. sales between companies in a similar industry (with very different ratios across different types of companies). For example take the FCF/Sales ratio for Diageo and compare it to Allied Domecq. The company with the higher ratio converts more of its sales to cash. This is how i can use it. Free cash flow is the amount of cash that a company has left over after it has paid all of its expenses, including investments. Negative free cash flow is not necessarily an indication of a bad company, however, since many young companies put a lot of their cash into investments, which diminishes their free cash flow. But if a company is spending so much cash, it should have a good reason for doing so and it should be earning a sufficiently high rate of return on its investments. While free cash flow doesn't receive as much media coverage as earnings do, it is considered by some experts to be a better indicator of a company's financial health. Enterprise value: A measure of what the market believes a company's ongoing operations are worth. Enterprise value is equal to (company's market capitalization - cash and cash equivalents + preferred stock + debt). The number is of importance both to individual investors and potential acquirers considering a takeover attempt. Has a delay of 15 minutes but Bloomberg has a 1 minute delay.
5 pieces of financial information Book value per share- a ratio that if it is less than one then the company is undervalued and therefore you should buy it. Net worth of company divided by the number of shares. EBITDA- earnings before interest, tax, Depreciation and Amortization. So EBITDA measures the actual cash the company generates before taking such expenses into account. This is important because it is used to see how the company performs compared to others. Market Capitalisation- the amount of shares X share price. This is important because if there is less shares there is more risk however more money can be made. Dividend per share- how much money you make or loose per share. This is useful to know because it tells you how much profit you make. Enterprise value- the debt the company has. The enterprise value is used as an alternative to market capitalization. It is a more accurate estimate than the market capitalization. This can affect you choice when choosing to invest.
EPS(Earnings Per Share)- price of each share can be compared to the earnings. The higher the P/E ratio (price to earnings) the higher the share is valued. • EBITDA(Earnings before interest, taxes, depreciation, amortization)- useful for comparing companies within the same sector with similar depreciation/amortization costs. It gives the idea of how well a company is performing. • Market Capitalisation- number of shares x current market price=value of all outstanding shares. Tells you the company’s value that it trades on the stock market. The traded value of the company is affected by its size and its growth prospects. • Net income- can compare a company’s total earnings to another; reflects expenses, like: taxes; interest...etc. • Enterprise Value- it is the measure of a company’s value taking into account the net cash/debt. Market capitalisation +net debt. This is useful because it tells you the takeover price and what the owner would have to take on to that company’s debt, yet they would get its cash. • Depreciation- the drop in value. • Amortization- when you gradually reduce the value of something to zero over a period of time.
Business and Economics EBITDA-This stands for Earnings Before Interest, Tax, Depreciation, and Amortisation. Its the income with interest, tax, depreciation and amortisation added back on to it. Its important as it can be analysed and used to compare between companies and industries and takes away financing decisions. Like Tesco's and Sainsbury's and seeing the comparisons with companies in the same sectors and see whose performing better. EPS-This is the earnings per share. Its important as the price of the share can compared to the earnings and help choose a share price and show the value. The higher the p/e, the higher value the share is. A p/e above 25 could be considered high, and below 10 could be considered low meaning the value would be lower and therefore the share price would be cheaper. Market Capitalisation-This is the value of the outstanding shares. You use the formula number of shares multiplied by the current price. This tells us the value of a companies trades when put on the stock market and will help people decide whether its good value trade to buy or not. It can also be known as market cap. EV to sales-This is the enterprise value divided by the sales over the past 12 months using equity, debt and cash. It helps us know how much the companies worth. The higher it is, you should buy it. Net income-Thisis a companies total earnings minus the expenses. Its useful as it can be used to compare a companies earnings to another company and see which ones are more worth buying. By Molly O’Donovan
EV = Enterprise Value is a measure of a company’s value taking net debt into account. Market capitalization plus net debt. It will help you see a company’s growth prospects. • EBITDA = Earnings before interest, tax, depreciation and amortisation. This shows how well the company is performing and the money that it has made. • Market Capitalisation is the total value of all outstanding shares. It's calculated by multiplying the number of shares by the current market price. This term is often referred to as the market gap. This shows the value of the company on the stock market • Net income is a company’s total earnings, reflecting revenues adjusted for costs of doing business, depreciation, interest, taxes and other expenses. This shows how much the company is making and getting rid of. • EPS = Earnings per share. The portion of a company’s profit allocated to each outstanding share. This is useful as it shows the price of each share which can be compared to the underlying earnings.
FINANCIAL INFORMATION Enterprise Value – The value of a company including equity, debt and cash. This helps as how much a company is worth with affect the stock prices. The higher it is, you should buy it. Book Value Per Share – Total value of assets divided by number of outstanding shares. It helps people decided if they should buy or sell shares. Pre-tax Income – The income a company gets before tax. This is important as it helps figure out stock prices. EBITDA - Earnings before interest, taxes, depreciation and amortization. A companies cash flow before deductions. It helps analysts predict what is going to happen. Dividend per share – Total dividend (money paid to shareholders from profit) divided by average number of shares. This is important as it helps share holders know how much money they will get. Matilda Buckingham.
If the book value is less than 1 the company is usually under valued The announcement of dividends is important because this shows the profit or losses of a company, this can affect the share price of the company because if they make a loss then less people are going to are going to want to investment The amount of free cash flow or debits can affect the share price because if a company has a free cash flow then it can buy companies and expand its business and if it has debit all of their profits are going to be going towards paying those debits off. If the company has scandal or makes an error the share price of the particular company is going to go down because less people are likely to buy the product. E.G Barclays with the Libour scandal, Barclays share price went down 500% .Often, the stock price of the companies in the same industry will move in tandem with each other. This is because market conditions generally affect the companies in the same industry the same way. But sometimes, the stock price of a company will benefit from a piece of bad news for its competitor if the companies are competing for the same market. The introduction of a product can be a big boost for a company share price, if it is good, as the profits of the company will rocket due to everyone buying the new product.