50 1774 632 1441 peg 068 211 105 162 whats s

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Unformatted text preview: ● Pitfalls: no theoretical underpinnings AAPL Industry Sector S&P 500 P/E 12.50 17.74 6.32 14.41 PEG 0.68 2.11 1.05 1.62 What’s S& P 500? The S&P 500, or the Standard & Poor's 500, is a stock market index based on the market capitalization of 500 leading companies publicly traded in the U.S. stock market, as determined by S&P. Other market ratios (2) Market-to-book ratio = Market value per share / Book value per share ● Other measure to assess the value generated by the firm. Cycles and economic activity ● Firms are subject to growth fluctuations. ● Also some seasonality: Summer vs. Winter sales ● So in good times, sales & earnings increase… ● in bad times, sales & earning decrease Cycles and economic activity (2) ● Is P/E a good ratio to measure the fundamental value of the firm? ● cyclically adjusted price...
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This document was uploaded on 02/23/2014 for the course CB 3410 at City University of Hong Kong.

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