Category: Money tips Release Date: 2007-04-15
Having experienced more than two years of adjustment, the current market average price-earnings ratio has dropped to 30 times, some listed company's share price more and more close to the net assets per share. From the historical data comparing perspective, since 1996, launched two waves of the bull market, Shanghai stock market on average 29 times price-earnings ratio it was in the vicinity of 30 times the current price-earnings ratio to climb to have a closer comparison. The Shanghai and Shenzhen A share index at 1.50 times the book value of listed companies reached more than 60. In other words, the current price-earnings ratio, book value have been at a historic bottom of the region, with the growing popularity of the concept of value investing, investors can dynamically refer to these two key indicators, seemingly at stake in the current large cap to look for low risk and high the safety of the stock returns.
Price-earnings ratio that the company's share price divided by the ratio of earnings per share. The level of this indicator is to determine whether there is investment value of the stock one of the bases. Such as Chang'an Automobile, Shanghai Auto and other major Niugu the first half, start at the beginning of the 15 times price-earnings ratio are the following. In contrast white goods industry has entered a stable development period, despite the price-earnings ratio is also significantly lower, its overall performance have deteriorated. Shows that the stock market performance is most needed is a huge increase in the expected room for imagination. Therefore, the choice of low price-earnings ratio at the same time, in addition to concerns about its business cycle, in which should be carefully studied individual stocks with low price-earnings ratio of the "gold content."
MB ratio is the stock price and the ratio of net assets per share. Book value (PB), means that stock prices relative to net asset value per share, a premium rate. PB = 1, that has been returned to stock and net assets per share equivalent; PB <1, that stock price has fallen below a net asset value per share. Compared to net income, the net asset value to better reflect the overall strength of enterprises, with book value of indicators to reflect the company's intrinsic value is more reliable.
Value in mature markets to institutional investors tend to select by book value compared with the absolute investment value of stocks, an important reason is that the markets exist in a large number of PB �1 stocks. While the domestic market because of the inherent defects, the overall pricing mechanisms are highly distorted, PB value is close to a stock is very limited. PB value of the stock from a low pre-20 situation, there were 15 funds held by brokerage firms, which are heavily loaded or Masukura 9, indicating that the value of the stock for the majority of low-PB institutional investors bullish, some individual stocks, such as chi electro-shares , SGIS, New Steel and Vanadium is a good investment varieties. Concerned about the book value at the same time, it must pay attention to the quality of the assets of these companies, there are two main indicators: First, asset-liability ratio, one guarantees the amount of total net assets ratio. These two indicators are part of the company's net assets measure whether the short-term over-shrink the key.
Overall, the current low price-earnings ratio, low book value stock-based large-cap stocks are still cheap.
