Price to Operating Profit (P/OP)
since 2012
Calculation
Kraft Foods Group Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Operating income1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 19, 2015 | 19.96 | = | 64.17 | ÷ | 3.21 | 3.21 | = | 1,890 | ÷ | 587,988,695 | |
| Feb 21, 2014 | 7.16 | = | 55.09 | ÷ | 7.70 | 7.70 | = | 4,591 | ÷ | 596,311,563 | |
| Mar 21, 2013 | 11.48 | = | 51.66 | ÷ | 4.50 | 4.50 | = | 2,670 | ÷ | 593,372,593 |
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of Kraft Foods Group Inc. Annual Report.
The financial trajectory between 2013 and 2015 is characterized by a consistent increase in share price contrasted with significant volatility in operating profitability, leading to substantial fluctuations in the Price to Operating Profit (P/OP) valuation ratio.
- Share Price Trend
- A steady upward trend is observed in the share price, which rose from US$ 51.66 in March 2013 to US$ 64.17 by February 2015. This represents a continuous growth in market valuation over the analyzed period.
- Operating Profit per Share
- Operating profitability exhibited significant instability. After an initial increase from US$ 4.50 in 2013 to a peak of US$ 7.70 in 2014, there was a sharp decline to US$ 3.21 in 2015, marking the lowest operating profit per share within the three-year window.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio experienced extreme variance. It decreased from 11.48 to 7.16 in 2014, driven by the surge in operating profit. However, by February 2015, the ratio surged to 19.96. This spike was the result of a simultaneous increase in share price and a substantial contraction in operating profit per share, indicating a significantly higher valuation multiple relative to actual operating performance.
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Comparison to Competitors
Kraft Foods Group Inc., P/OP, long-term trends, comparison to competitors
| Kraft Foods Group Inc. | lululemon athletica inc. | |
|---|---|---|
| Feb 19, 2015 | 19.96 | 19.02 |
| Feb 21, 2014 | 7.16 | 24.82 |
| Mar 21, 2013 | 11.48 | 38.00 |
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).