General Mills Inc. (NYSE:GIS)

Price to Earnings (P/E) Ratio

The Price to Earnings ratio displayed significant fluctuations over the six-year period. Starting at 17.81 in 2014, it surged to a peak of 27.74 in 2015, indicating increased investor optimism or expectations for earnings growth. Subsequently, it gradually declined to 12.32 by 2018, reflecting either improving earnings or a reduction in market valuation multiples, before rising again to 18.04 in 2019. This pattern suggests variability in market sentiment and earnings performance over the years.

Price to Operating Profit (P/OP) Ratio

This ratio followed a trend similar to the P/E ratio, beginning at 10.99 in 2014 and increasing sharply to 16.31 in 2015. After reaching this peak, it gradually decreased to 10.47 in 2018, indicating either better operating profit margins or a valuation adjustment by the market. There was a modest increase again to 12.57 in 2019, implying some recovery in valuation multiples relative to operating profit.

Price to Sales (P/S) Ratio

The Price to Sales ratio demonstrated moderate volatility. It increased from 1.81 in 2014 to a high of 2.57 in 2016, suggesting the market placed a higher valuation on the company's sales at that point. However, it declined to 1.67 by 2018, marking the lowest level in the period examined. By 2019, it rose slightly to 1.87. This movement reflects changing market perceptions of sales growth potential or profitability embedded in sales figures.

Price to Book Value (P/BV) Ratio

The Price to Book Value ratio experienced the most pronounced variability. It increased from 4.97 in 2014 to a peak of 8.64 in 2016, reflecting elevated market valuation relative to net assets. Thereafter, it declined sharply to 4.28 in 2018, the lowest level seen in the period analyzed, and rose marginally to 4.48 in 2019. This pattern may indicate shifts in investor confidence regarding the company’s asset base or changes in book value due to asset revaluation or earnings retention.

The financial data presents trends in share price, earnings per share (EPS), and price-to-earnings (P/E) ratio over a six-year period.

Share Price

The share price showed initial growth, rising from $53.05 in 2014 to a peak of $71.32 in 2016. However, this was followed by a significant decline to a low of $44.26 in 2018, before partially recovering to $52.52 in 2019. This indicates volatility with a downward trend after 2016 and a modest rebound towards the end of the period.

Earnings Per Share (EPS)

The EPS fluctuated during the period, starting at $2.98 in 2014 and dropping sharply to $2.04 in 2015. Subsequently, it increased to $2.84 in 2016 and marginally to $2.87 in 2017. A notable rise occurred in 2018 with EPS reaching $3.59, before falling back to $2.91 in 2019. This pattern suggests an unstable earnings performance with a pronounced peak in 2018.

Price-to-Earnings (P/E) Ratio

The P/E ratio varied considerably, climbing from 17.81 in 2014 to a high of 27.74 in 2015. It then declined consistently over the next three years, reaching a low of 12.32 in 2018, before increasing again to 18.04 in 2019. The decreasing trend from 2015 to 2018 reflects a period where share prices may have declined faster than earnings improvements, or earnings rose while prices dropped. The partial recovery in 2019 indicates a normalization of valuation metrics.

Share Price Trend

The share price showed an overall fluctuation over the analyzed period. It increased from $53.05 in May 2014 to a peak of $71.32 in May 2016, followed by a significant decline to $44.26 in May 2018. By May 2019, the share price partially recovered to $52.52, remaining below the 2016 peak but close to the initial 2014 value.

Operating Profit Per Share

The operating profit per share exhibited slight volatility, starting at $4.83 in 2014 and dropping to a low of $3.47 in 2015. It then increased again to $4.53 in 2016, after which it gradually declined over the next three years to reach $4.18 in 2019. The trend indicates some instability but generally stable profitability around the $4.2 to $4.8 range toward the end of the period.

Price to Operating Profit (P/OP) Ratio

The P/OP ratio reflected notable variability. It rose sharply from 10.99 in 2014 to a peak of 16.31 in 2015. After slight fluctuation in the next year, it declined steadily to the lowest point of 10.47 in 2018 before increasing again to 12.57 in 2019. This pattern suggests changing market valuations relative to operating profit, potentially influenced by shifts in investor sentiment or external market conditions.

Overall Insights

Overall, the data indicates a period of volatility in both market valuation and profitability metrics. The peak in share price and P/OP ratio around 2015-2016 suggests a market optimism phase, followed by a more cautious period reflected in declining share price and operating profit per share. The slight recovery in 2019 may imply renewed investor confidence but at a more moderate valuation relative to operating profit compared to earlier years.

Share Price Trend

The share price demonstrated variability over the six-year period. It initially increased from $53.05 in May 2014 to a peak of $71.32 in May 2016. After this peak, there was a notable decline, reaching a low of $44.26 in May 2018, followed by a moderate recovery to $52.52 by May 2019.

Sales Per Share Trend

Sales per share exhibited a generally decreasing trend from 2014 to 2018, falling from $29.24 to $26.53. In the final year, there was a slight rebound to $28.02, but this value remained below the initial figures observed in 2014 and 2015.

Price-to-Sales (P/S) Ratio Trend

The P/S ratio presented fluctuations similar to the share price. It climbed from 1.81 in 2014 to a peak of 2.57 in 2016, indicating an increased market valuation relative to sales. This was followed by a decrease to 1.67 in 2018, coinciding with the decline in share price. By 2019, the P/S ratio had partially recovered to 1.87.

Interrelationships and Insights

Overall, share price movements appear to correlate with changes in the P/S ratio, suggesting that market valuation adjustments were a significant factor in the share price fluctuations. The decline in sales per share over the period may have influenced investor sentiment negatively, particularly visible in the declining share price and P/S ratio post-2016. The rebound in sales per share and P/S ratio in 2019 aligns with the modest recovery in share price, indicating potential improvement in market outlook or operational performance during that year.

Share Price Trends

The share price exhibited notable fluctuations over the six-year period. Initially, it increased from $53.05 in May 2014 to a peak of $71.32 in May 2016. Following this peak, a decline ensued, reaching a low of $44.26 in May 2018. Subsequently, the price showed a recovery, rising to $52.52 by May 2019. This pattern reflects a period of volatility with a significant peak mid-period and a partial rebound towards the end.

Book Value per Share (BVPS) Trends

The book value per share demonstrated a general downward trend from $10.67 in May 2014 to a low of $7.50 in May 2017. After this trough, BVPS recovered steadily, climbing back to $11.72 by May 2019, surpassing the initial value at the start of the period. The dip and subsequent recovery suggest cycles in asset valuation or equity adjustments during these years.

Price-to-Book Value Ratio (P/BV) Trends

The P/BV ratio initially rose sharply from 4.97 in May 2014 to a high of 8.64 in May 2016, indicating that the market price grew disproportionately relative to book value per share. Following this peak, P/BV declined significantly to 4.28 by May 2018, before slightly increasing to 4.48 in May 2019. The ratio’s behavior aligns with share price volatility and changes in BVPS, highlighting shifts in market valuation and investor sentiment over the period.

Overall Insights

The data reflects a cycle wherein the market valuation surged initially, with share price increases outpacing growth in book value. This was followed by a period of correction where both share price and P/BV fell, possibly indicating market reassessment or external factors affecting valuation. The recovery in book value per share towards the end of the period, combined with partial share price recovery, suggests improved underlying fundamentals, yet the P/BV ratio remaining lower than mid-period peaks points to more conservative market expectations.