In my previous post I described the story of Anne Scheiber, an unsung hero in the investment world. Scheiber owned a portfolio of stocks worth US$22 million when she died. Notably she made lots of money by investing and holding on to a pharmaceutical stock called Schering Plough. From what I read, she has never [...]
In his book The 21 Irrefutable Laws of Leadership, John Maxwell says that becoming a leader is a lot like investing successfully in the stock market. If you hope to make a fortune in a day, you won’t be successful. What matters most is what you do day by day over the long haul. This, [...]
It has never been easier to compare Malaysian company financials using our Investor Tool. Instead of painstakingly keying in data into Excel (which I used to do myself), just go to Investor Tool – at the bottom notice the Company Comparison box.
Q: So how do you double your money every 5 years? A: Earn a compound return of 15% every year. Don’t believe? OK say you have $1 now. Take out your calculator and go 1 x 1.15 – that gives you $1.15 – this is the amount you have at the end of the first [...]
ROE = Net Profit After Tax & Minority Interest / Average Shareholders Funds ROE is a popular measure of how efficient a company is using its funds to generate income for its shareholders. Unlike Return on Capital Employed, it does not take into account a company’s gearing position. For example, a company can increase its [...]
Capital Employed is also sometimes referred to as Funds Employed. It is basically the total of a company’s Business Assets (excluding its Cash holdings) less its Trade-related Liabilities. Capital Employed = Net Assets – Cash + Borrowings
Dividend Yield = Gross Dividend per Share / Share Price Dividends are usually periodic cash payments to shareholders out of a company’s earnings or earnings reserve. In corporate finance theory, the total returns you get from investing in a share = Income Return + Capital Return where Income Return is your dividend component, while Capital [...]
PEG Ratio stands for Price-Earnings to Growth Ratio. It is a ratio used to determine a stock’s value while taking into account earnings growth. The calculation is as follows: PEG Ratio = PER / Annual EPS Growth PEG is a widely used indicator of a stock’s potential value. It is favored by many over the [...]
EBIT Multiple = Enterprise Value / EBIT (EBIT stands for Earnings Before Interest and Tax. It is the profits of the company before the impact of interest income, interest expense and tax expense. As such it is an indicator of the earnings of a business excluding the impact of its cash holdings and borrowings). Calculation of [...]
PE Ratio = Share Price / Earnings Per Share Where Earnings per share (EPS) is a company’s Net Profit After Tax and Outside Equity Interest, divided by the Weighted Average Equivalent Number of Shares issued. For example if a company makes a net profit after tax of RM10 million and it has 100 million issued [...]
