Valuation ratios Flashcards
1
Q
Valuation ratios
A
Measures to help investors assess the market value of a firm
- these ratios are intended to make intra-industry comparisons of firm valuations
2
Q
Price-to-earnings ratio (P/E)
A
Market capitalization / Net income
or share price / EPS
3
Q
EV to EBIT
A
(Market value of equity + net debt) / EBIT
4
Q
EV to sales
A
(Market value of equity + net debt) / Sales