Valuation based on price-earnings multiple
Valuation based on the ratio of
marketprice to book value of Equity
As you see the table, we can suggest to buy the DSME’s stock because the table shows us this stock is undervalued. But we, the investors have to recognize the limitations of multiple-valuations. If the benchmarks are changed, we can decide in another way from sensitivity analysis.
and having high profit.
Inventories
We use the weighted average inventory method to evaluate the estimated acquisition cost and calculate the quantity and amount according to the year-round method. However, if the property stock marketprice is lower than acquisition costs, the marketprice is alternative by the financial status table value so there is no loss on valuation of assets in stock.
3) Put Option Valuation
A Pall Option confers the right on its holder, without the obligation, to sell the underlying asset at a certain date for a certain price. Only a little extra work is needed to value put options. Basically , we just pretend that a put option is a call option and use the Black-Scholes formula to value it. We then use the put-call parity condition to solve for the put valu
Marketable securities + Receivables / Current liabilities
= Quick assets / Current liabilities
Year 2009 2008 2007
ratio 0.99 1.04 1.12
Quick ratio of Hyundai also slightly decreased as we can see right above. In conclusion, liquidity ratios consist of current ratio and quick ratio is gradually decreased so they need to raise liquidity little bit.
(3) Account receivable turnover
Acco
Market Value
The Price-Earning Ratio(PER) is the ratio that shows the value of stock compared to the profit a certain company earns. The PER of Hyundai is 15.61 and that of Kia is 11.37. This means that the stock of Hyundai is overvalued in the market, compared to the profit it makes. This may be the result of investors valuating Hyundai as a more profitable and stable company. At the same time