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Multipliers


P/E is the ratio of a company's market capitalization to its annual earnings. In other words, this ratio shows how many years it will take to pay off the business if the company distributes all its net profits to shareholders. The lower the ratio, the better.

E/P is the ratio of a company's annual profits to its market capitalization. In other words, this ratio shows how much company's market capitalization. In other words, it shows how much money an investor can make in a year as a percentage if the company distributes all of its net profits to shareholders. The higher the ratio. higher the ratio, the better.

P/B is the ratio of a company's market capitalization to its book value. In other words, it's a measure of a company's valuation of the company by the market relative to its book value. A value of less than 1 indicates that the business is undervalued, while a value greater than 1 indicates that it is overvalued. This indicator is not relevant for high-tech and other companies that do not require capital growth to increase profits.

P/S is the ratio of a company's market capitalization to its annual revenue. In other words, this ratio provides a company's valuation by the market in relation to its annual revenue. This indicator is particularly relevant for companies with volatile net profits. The lower it is, the better.

P/CF is the ratio of a company's market capitalization to its annual cash flow. In other words, this ratio shows how many years a business will take to pay for itself, if only real operating profits are taken into account. The lower the ratio, the better.

L/A is the ratio of the company's total debt to its total assets. In other words, this ratio shows the share of the company's debt in its total assets. This multiplier is also called the leverage ratio. The lower the ratio, the better.

NetDebt / EBITDA - the ratio of the company's net debt to EBITDA. In other words, this ratio shows how many years it will take the company to repay all of its debt from net income without being affected by factors beyond the company's control (such as interest on loans, taxes depreciation and amortization). The lower the number, the better.

EV/EBITDA is the ratio of a company's value to EBITDA. In other words, this multiplier shows how many years it will take to recoup the the company's debts, if factors beyond the company's control (such as interest on loans, taxes, depreciation and amortization) are not taken into account. The lower the number, the better.

ROA - Return on Assets. Shows the share of net income in the company's assets. The more, the better. In other words, this indicator reflects the effectiveness of management of the company's assets.

ROE - Return on Equity. Shows how much net profit per year is generated by the company's equity. The more, the better. In other words, this indicator shows how effectively the company's equity is being used.

ROS - Return on Sales. Shows the share of net profit in the company's revenue. The more it is, the better it is. In other words, this indicator reflects the ability to manage business costs and the cost of a product or service.