Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
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- Income Statement
- Balance Sheet: Assets
- Common-Size Income Statement
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Geographic Areas
- Price to FCFE (P/FCFE)
- Debt to Equity since 2005
- Price to Operating Profit (P/OP) since 2005
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Current Valuation Ratios
eBay Inc., current price multiples
| eBay Inc. | Amazon.com Inc. | Home Depot Inc. | Lowe’s Cos. Inc. | TJX Cos. Inc. | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Current share price (P) | ||||||
| No. shares of common stock outstanding | ||||||
| Growth rate (g) | ||||||
| Earnings per share (EPS) | ||||||
| Next year expected EPS | ||||||
| Operating profit per share | ||||||
| Sales per share | ||||||
| Book value per share (BVPS) | ||||||
| Valuation Ratios (Price Multiples) | ||||||
| Price to earnings (P/E) | ||||||
| Price to next year expected earnings | ||||||
| Price-earnings-growth (PEG) | ||||||
| Price to operating profit (P/OP) | ||||||
| Price to sales (P/S) | ||||||
| Price to book value (P/BV) | ||||||
Based on: 10-K (reporting date: 2018-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
eBay Inc., historical price multiples
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Price to earnings (P/E) | ||||||
| Price to operating profit (P/OP) | ||||||
| Price to sales (P/S) | ||||||
| Price to book value (P/BV) |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
- Price to Earnings (P/E) Ratio
- The P/E ratio exhibited extreme volatility from 2014 to 2018. Initially, in 2014, the ratio was exceptionally high at 1433.64, indicating possibly anomalous earnings or market conditions at that time. The ratio sharply declined to 16.36 in 2015 and further decreased to 4.79 by 2016, reflecting a significant change in earnings relative to price. The data for 2017 is missing, and in 2018 the ratio increased again to 12.32, suggesting some recovery or change in profitability or stock price. Overall, the trend shows a normalization after an outlier initial year with fluctuations thereafter.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio demonstrated some fluctuations but stayed within a narrower range compared to the P/E ratio. Starting from 18.77 in 2014, it decreased to 12.84 in 2015, then slightly increased to 14.98 in 2016. The ratio reached a peak of 18.93 in 2017 before declining to 14.03 in 2018. This indicates variability in operating profit relative to market price but generally reflects moderate valuation multiples with no drastic changes.
- Price to Sales (P/S) Ratio
- The P/S ratio showed a generally increasing trend from 2014 to 2017 followed by a decline in 2018. Starting at 3.68 in 2014, it slightly decreased to 3.28 in 2015 then increased steadily to 3.88 in 2016 and peaked at 4.48 in 2017. The ratio dropped to 2.90 in 2018, marking a significant decrease in valuation relative to sales in the last year of the period. This may indicate changes in revenue growth or investor sentiment.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio exhibited an overall upward trend through the years analyzed, except for a dip in 2016. Beginning at 3.31 in 2014, it increased noticeably to 4.29 in 2015, declined to 3.30 in 2016, then sharply rose to a peak of 5.32 in 2017 before slightly falling to 4.96 in 2018. This pattern suggests fluctuating perceptions of the company’s net asset value over time with a generally higher market valuation relative to book value from 2015 onwards.
Price to Earnings (P/E)
eBay Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Net income (loss) (in millions) | ||||||
| Earnings per share (EPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/E ratio4 | ||||||
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
EPS = Net income (loss) ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of eBay Inc. Annual Report.
4 2018 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
The financial data exhibits notable fluctuations in the share price, earnings per share (EPS), and price-to-earnings (P/E) ratio over the five-year period.
- Share Price
- The share price shows considerable volatility, initially declining sharply from $54.50 at the end of 2014 to $23.94 by the end of 2015. It then appreciates steadily to $42.37 in 2017 before declining again to $34.08 in 2018.
- Earnings per Share (EPS)
- EPS demonstrates a highly variable trend. It increases significantly from a negligible $0.04 in 2014 to a peak of $6.68 in 2016. However, in 2017, EPS turns negative at -$1.00, indicating a loss, before recovering to $2.77 in 2018. This suggests fluctuations in profitability and potential one-time impacts influencing earnings.
- Price-to-Earnings (P/E) Ratio
- The P/E ratio shows extreme initial elevation at 1433.64 in 2014, due to the very low EPS. It then declines sharply to 16.36 in 2015 and further to 4.79 in 2016, reflecting improved earnings performance relative to the share price. No P/E data is available for 2017, likely due to the negative EPS, which makes calculation of a meaningful P/E ratio infeasible. In 2018, the P/E rises to 12.32, corresponding with positive but lower EPS levels compared to earlier years.
Overall, the data reflects a period of significant earnings variability impacting valuation multiples, with profit recovery after a loss year and share price movements that partially correspond with earnings changes but also suggest external market or operational influences.
Price to Operating Profit (P/OP)
eBay Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Income from operations (in millions) | ||||||
| Operating profit per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/OP ratio4 | ||||||
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
Operating profit per share = Income from operations ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of eBay Inc. Annual Report.
4 2018 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price experienced a significant decline from 54.50 US$ in late 2014 to 23.94 US$ in late 2015, representing a notable drop within one year. Subsequently, the share price showed a recovery trajectory, increasing to 32.03 US$ in 2016 and further to 42.37 US$ in 2017. However, in 2018, the price decreased again to 34.08 US$, indicating some volatility and lack of consistent upward momentum over the five-year period.
- Operating Profit Per Share
- Operating profit per share exhibited a generally positive trend over the five years. Starting at 2.90 US$ in 2014, it declined to 1.86 US$ in 2015, mirroring the share price drop during the same period. From that low point, the operating profit per share steadily increased each year, reaching 2.14 US$ in 2016, 2.24 US$ in 2017, and 2.43 US$ in 2018. This indicates an improvement in operational profitability on a per-share basis after 2015.
- Price to Operating Profit Ratio (P/OP)
- The price to operating profit ratio followed a fluctuating pattern. Starting at a relatively high multiple of 18.77 in 2014, the ratio fell sharply to 12.84 in 2015, coinciding with the drop in share price and operating profit per share. It then increased to 14.98 in 2016 and peaked at 18.93 in 2017, closely aligning with the rising share price. By 2018, it decreased again to 14.03, reflecting a reduced valuation multiple despite the improving operating profit per share.
- Overall Analysis
- Over the five-year time frame, the data portrays a period of volatility followed by recovery in share price, alongside a more consistent upward trend in operating profit per share post-2015. The P/OP ratio's fluctuations suggest changing market perceptions of the company’s operational earnings value relative to its share price. The divergence in 2018, where operating profit per share increased but the P/OP ratio decreased, may imply more conservative market expectations or external factors affecting valuation.
Price to Sales (P/S)
eBay Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Net revenues (in millions) | ||||||
| Sales per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/S ratio4 | ||||||
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
Sales per share = Net revenues ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of eBay Inc. Annual Report.
4 2018 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited substantial variation over the five-year period. It fell sharply from $54.50 in 2014 to a low of $23.94 in 2015. Following this decline, the share price gradually recovered, increasing to $32.03 in 2016 and reaching a peak of $42.37 in 2017. However, in 2018, the share price declined again, finishing at $34.08.
- Sales per Share
- Sales per share showed a significant drop from $14.79 in 2014 down to $7.29 in 2015, paralleling the share price decrease. This was followed by a steady upward trend over the next three years, rising to $8.26 in 2016, $9.45 in 2017, and culminating at $11.75 in 2018. Despite the recovery, sales per share in 2018 remained below the 2014 level.
- Price-to-Sales (P/S) Ratio Analysis
- The P/S ratio declined initially from 3.68 in 2014 to 3.28 in 2015, reflecting the combined impact of a falling share price and decreased sales per share. It then increased progressively to 3.88 in 2016 and further to 4.48 in 2017, indicating a strengthening valuation relative to sales. In 2018, the ratio dropped markedly to 2.9, which may suggest either a rise in sales valuation or a relative decrease in share price compared to sales.
- Overall Insights
- The data indicates a difficult year in 2015 characterized by significant declines in share price and sales per share. Subsequently, there was a moderate recovery phase from 2016 to 2017, with improving sales per share and a rising P/S ratio suggesting growing investor confidence. The downturn in the P/S ratio and share price in 2018 signals a potential shift in market perception or underlying business challenges despite continued growth in sales per share. This mixed performance suggests a need for careful monitoring of sales execution and market valuation factors going forward.
Price to Book Value (P/BV)
eBay Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Stockholders’ equity (in millions) | ||||||
| Book value per share (BVPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/BV ratio4 | ||||||
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of eBay Inc. Annual Report.
4 2018 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period ending in 2018. The share price experienced fluctuation, with a significant decline from $54.5 in 2014 to a low of $23.94 in 2015, followed by a recovery phase peaking at $42.37 in 2017 before falling slightly to $34.08 in 2018.
The book value per share (BVPS) showed a decreasing trend overall. It dropped sharply from $16.45 in 2014 to $5.58 in 2015, then partially recovered to $9.7 in 2016. However, it declined again to $7.97 in 2017 and continued downward to $6.87 in 2018. This pattern indicates volatility in the company's equity value per share, with a notable reduction compared to the initial 2014 value.
The price-to-book value ratio (P/BV) demonstrated variability consistent with the movements in share price and BVPS. Initially, the ratio was 3.31 in 2014, increased to 4.29 in 2015 despite the decrease in share price, likely due to the sharper decline in BVPS during this period. It then decreased to 3.3 in 2016 alongside the stabilization in share price and improvement in BVPS. Subsequently, there was a marked increase to 5.32 in 2017, reflecting the peak in share price relative to book value, followed by a slight decline to 4.96 in 2018.
- Share Price
- Significant volatility with a low point in 2015 and partial recovery thereafter.
- Book Value per Share
- Overall decreasing trend with partial recovery in 2016, indicating fluctuations in equity value per share.
- Price-to-Book Ratio
- Variable trend reflecting the interplay of share price and BVPS changes, peaking in 2017.
In summary, the data suggests a period of instability in market valuation and equity value per share, followed by attempts at recovery which were not sustained through 2018. The elevated P/BV ratio in the latter years signifies that the market price was relatively high compared to book value, which may imply investor optimism or perceived growth potential despite underlying declines in book value per share.