FUNDAMENTAL ANALYSIS

• It's the net difference between that company's total assets and total liabilities, where book value reflects the total value of a company's assets, which shareholders of that company would receive if the company were to be liquidated.
• An asset's book value is equivalent to its carrying value on the balance sheet.
• If negative, it could indicate the company is heading for bankruptcy. 
• Often lower than a company's or asset's market value.
• Book value per share (BVPS) and the price-to-book (P/B) ratio all utilize book value in fundamental analysis.​

Source : Investopedia

• Book value per common share (BVPS) calculates the common stock per-share book value of a firm.
• Since preferred stockholders have a higher claim on assets and earnings than common shareholders, preferred equity is subtracted from shareholders equity to derive the equity available to common shareholders.
• If a company’s BVPS is higher than its market value per share, then its stock may be considered to be undervalued.​

Source: Investopedia

• Measures the market's valuation of a company relative to its book value.
• The market value of equity is typically higher than the book value of a company.
• Used by value investors to identify potential investments.
• Value < 1 = considered solid investments.

Source: ​Investopedia

• Relates a company's share price to its earnings per share.
• A high ratio could mean that a company's stock is overvalued, or else that investors are expecting high growth rates in the future.
• Companies that have no earnings or that are losing money do not have a P/E ratio since there is nothing to put in the denominator.
• Two kinds of P/E ratios - forward and trailing P/E - are used in practice.

Source: Investopedia

• Shows how much investors are willing to pay per dollar of sales for a stock. 
• Calculated by dividing the stock price by the underlying company's sales per share.
• A low ratio could imply the stock is undervalued, while a ratio that is higher-than-average could indicate that the stock is overvalued.
• Doesn’t take into account whether the company makes any earnings or whether it will ever make earnings.​

Source: Investopedia

• The company's net profit divided by the number of common shares it has outstanding.
• Indicates how much money a company makes for each share of its stock.
• A higher EPS indicates greater value because investors will pay more for a company's shares if they think the company has higher profits relative to its share price.
• EPS can be arrived at in several forms, such as excluding extraordinary items or discontinued operations, or on a diluted basis.

Source: Investopedia

• Forward P/E is a version of the ratio of price-to-earnings that uses forecasted earnings for the P/E calculation.
• Because forward P/E uses estimated earnings per share (EPS), it may produce incorrect or biased results if actual earnings prove to be different.
• Analysts often combine forward and trailing P/E estimates to make a better judgment.​

Source: Investopedia

• The trailing price-to-earnings ratio looks at a company's share price in the market relative to its past year's earnings per share.
• Trailing P/E is considered a useful indicator to standardize and compare relative share price between time periods and among companies.
• Trailing P/E, though widespread in use, is limited in that past earnings may not accurately reflect the current or future earnings situation of the company.

Source: Investopedia

• Enhances the P/E ratio by adding in expected earnings growth into the calculation.
• Considered indicator of a stock's true value, and similar to the P/E ratio, a lower PEG may indicate that a stock is undervalued.
• The PEG for a given company may differ significantly from one reported source to another, depending on which growth estimate is used in the calculation, such as one-year or three-year projected growth.
  

Source: Investopedia

• Measures the profitability of a corporation in relation to stockholders’ equity.
• Whether an ROE is considered satisfactory will depend on what is normal for the industry or company peers.
• As a shortcut, investors can consider an ROE near the long-term average of the S&P 500 (14%) as an acceptable ratio and anything less than 10% as poor.

Source: Investopedia

• The debt-to-equity (D/E) ratio compares a company’s total liabilities to its shareholder equity and can be used to evaluate how much leverage a company is using.
• Higher-leverage ratios tend to indicate a company or stock with higher risk to shareholders.
• However, the D/E ratio is difficult to compare across industry groups where ideal amounts of debt will vary.
• Investors will often modify the D/E ratio to focus on long-term debt only because the risks associated with long-term liabilities are different than short-term debt and payables.

Source: Investopedia

• Is the proportion of earnings paid out as dividends to shareholders, typically expressed as a percentage. 
• Some companies pay out all their earnings to shareholders, while some only pay out a portion of their earnings. If a company pays out some of its earnings as dividends, the remaining portion is retained by the business. To measure the level of earnings retained, the retention ratio is calculated.
• Several considerations go into interpreting the dividend payout ratio, most importantly the company's level of maturity. A new, growth-oriented company that aims to expand, develop new products, and move into new markets would be expected to reinvest most or all of its earnings and could be forgiven for having a low or even zero payout ratio.
• A range of 35% to 55% is considered healthy and appropriate from a dividend investor's point of view. A company that is likely to distribute roughly half of its earnings as dividends means that the company is well established and a leader in its industry.
• The dividend payout ratio can be calculated as the yearly dividend per share divided by the earnings per share, or equivalently, the dividends divided by net income (as shown below).

Source: Investopedia

• Performance metric that measures a company's profitability from operations.
• Earnings measure that focuses on the essentials of a business: its operating profitability and cash flows.
• Calculated by dividing EBITDA by revenue.
  

Source: Investopedia