Are the value measures -- price-to- book, price-to-earnings, price-to-cash flow -- in line with those of similar public companies?
He also looks at price-to-book, price-to-cash flow, price-to-cash and debt.
Price-to-book and price-to-cash flow factors resulted in different results.
Stack looks at historical measures of valuation: price-to-book ratios, price-to-dividend ratios and price-to-earnings ratios.
He screens for stocks using academic theories, which mostly boils down to companies with low price-to-book ratios, low price-to-earnings ratios, low short interest and positive earnings momentum.
Use multiple valuation metrics--not just the ratio of price-to-earnings but the ratios of price-to-sales and price-to-book.
Ardour Capital's Nasdeo says other traditional metrics, such as price-to-sales or price-to-book value, are not really much help either.
It holds Apple and Sun, but also some dot-coms and smaller techs, all having lots of cash and low price-to-earnings and price-to-book ratios.
Number-wise, Nieman is fond of the company's dividend yield (0.9% as of Nov. 30) and low price-to-earnings, price-to-book and debt-to-equity metrics, but also sees potential in the company's active pursuit of alternative energy solutions.
And what matters more, price-to-earnings or price-to-book value?
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On a price-to-sales and price-to-book basis as well, the stock is trading at premiums to industry averages.
It is easy to imagine circumstances in which a monopoly would charge less than the text-book profit-maximising price, either to extend its market (with a view to raising prices later) or to deter new entrants (a strategy known as limit-pricing).
Although many companies announce they "plan" to buy back their shares, Fried filters out the noise and goes for companies actually doing the buybacks and then screens for stocks trading at low price-to-earnings ratios, low price-to-book ratios and which meet an overall "value" criteria.
Its price-sales ratio is 27% below its 3.5 average since 2008, and the discount to its five-year average price-to-book value ratio is 31%.
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Finally, I set the valuation limits at a maximum price-to-book ratio of 4.0 and a maximum price-earnings ratio of 25.0.
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Tronox trades for less than book value, and at a 45% discount to its five-year average price-to-book value ratio.
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The price-to-book of 2.3x is above the peer group average of 1.7x, and it price-to-sales of 0.6x is on par with the peer group average.
Meanwhile, the price-to-book of 2.1x is below the peer group average of 2.2x and the price-to-sales of 0.2x is on par with the peer group average.
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For example, investors seem to hate stocks that are priced relatively low compared with book value, even though those stocks consistently have had higher long-term returns than flashy, high price-to-book stocks.
But many of our stocks are only two times and a few are even down to something approaching net book price-to-book is one.
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Oil-Dri Corp. ( ODC) showed up in the results of my value screening strategy. (The strategy is highlighted in the July AAII Journal First Cut column.) ODC trades at a price-earnings ratio of 17.0 and a price-to-book ratio of 1.7.
Still, serious caution is in order--in the real estate slump of 1990, Hovnanian's price-to-book ratio dropped as far as 0.3.
The company, which provides services related to the design and testing of semiconductors, carries a price-to-book value multiple of 1.1, low relative to a five-year average of 1.5.
For example, Fidelity national trades for 0.72 times sales, 1.85 times book value and at a price-to-earnings growth ratio of 0.91.
Even so, it trades at 10% below book value and has a trailing price-to-earnings ratio of 10, which is a big discount to the industry average of 16.
Publishers balked at Amazon's strategy out of concern that low prices could cannibalize their print sales, set unrealistic expectations in the minds of consumers, and lead Amazon to demand e-book price concessions from publishers.
He specifically cites and disparages his previous book, Superstocks, that introduced the price-to-sales ratio as a way to find undervalued stocks.
Ken Fisher started writing his monthly column in 1984, the same year he gained international attention for his book Super Stocks, which popularized the price-to-sales ratio.
Ken Fisher started writing his monthly column in 1984, the same year he gained international attention for his bestselling book Super Stocks, which popularized the price-to-sales ratio.
The stock yields 4.6% and has a price-to-book ratio of 1.7, modest relative to rivals.
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