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
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Debt to Equity since 2005
- Price to Operating Profit (P/OP) since 2005
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Historical Valuation Ratios (Summary)
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
- Price to Earnings (P/E) Ratio
- The P/E ratio data begins from March 31, 2019. It initially shows an upward trend from 14.48 to a peak of 28.7 by March 31, 2020, indicating increasing market expectations or growth prospects. Subsequently, the ratio declines steadily through 2020 and 2021, reaching a low of 8.33 at March 31, 2022, suggesting either improved earnings or reduced market optimism. Following this trough, the P/E ratio rises again moderately, stabilizing around mid-teens by March 31, 2023, reflecting a more balanced market view toward earnings valuation.
- Price to Operating Profit (P/OP) Ratio
- This ratio follows a similar trajectory, starting at 12.37 on March 31, 2019, climbing to a high near 16.26 by December 31, 2019. It then declines to a minimum of approximately 9.38 by December 31, 2021. The period after that shows a notable increase, peaking significantly at 23.98 on September 30, 2022, before retracting slightly to around 19.04 by March 31, 2023. This volatility suggests fluctuating investor sentiment about operating profit growth and its pricing in the market.
- Price to Sales (P/S) Ratio
- The P/S ratio also rises from 1.55 on March 31, 2019, to a peak of 1.91 on March 31, 2020. Following this, there is a decline to 1.33 by December 31, 2020, indicating potential contraction in market valuation relative to sales. However, from 2021 onwards, the P/S ratio shows a gradual upward trend, reaching another high of 2.34 on September 30, 2022, before settling back near 1.85-1.87 by the end of the observed period. This pattern points to varied investor confidence in sales growth potential over time.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio exhibits a general downward trend from 7.55 on March 31, 2018, dropping to roughly 4.62 by December 31, 2020. After this decline, the ratio fluctuates modestly, oscillating between approximately 4.43 and 5.91 up to March 31, 2023, without a clear directional trend. This stability at lower levels compared to earlier years may imply a recalibration in the market's valuation of the company's net asset base or changes in book value itself.
- Overall Observations
- The valuation multiples show considerable dynamics over the years, with notable peaks around early 2020 followed by declines through 2021. These shifts likely reflect changing market conditions, investor sentiment, and company performance factors. The recovery in ratios during late 2022 suggests renewed optimism or improved financial prospects. Price to earnings and operating profit multiples indicate variations in profitability expectations, while the price to sales ratio reflects sales growth perceptions. The declining price to book values over the longer term may denote adjustments in tangible asset valuation or cautious market perspectives on asset worth.
Price to Earnings (P/E)
Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
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No. shares of common stock outstanding1 | ||||||||||||||||||||||||||||
Selected Financial Data (US$) | ||||||||||||||||||||||||||||
Net earnings (in millions) | ||||||||||||||||||||||||||||
Earnings per share (EPS)2 | ||||||||||||||||||||||||||||
Share price1, 3 | ||||||||||||||||||||||||||||
Valuation Ratio | ||||||||||||||||||||||||||||
P/E ratio4 | ||||||||||||||||||||||||||||
Benchmarks | ||||||||||||||||||||||||||||
P/E Ratio, Competitors5 | ||||||||||||||||||||||||||||
Boeing Co. | ||||||||||||||||||||||||||||
Caterpillar Inc. | ||||||||||||||||||||||||||||
Eaton Corp. plc | ||||||||||||||||||||||||||||
GE Aerospace | ||||||||||||||||||||||||||||
Honeywell International Inc. | ||||||||||||||||||||||||||||
Lockheed Martin Corp. | ||||||||||||||||||||||||||||
RTX Corp. |
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Data adjusted for splits and stock dividends.
2 Q1 2023 Calculation
EPS
= (Net earningsQ1 2023
+ Net earningsQ4 2022
+ Net earningsQ3 2022
+ Net earningsQ2 2022)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of Northrop Grumman Corp. Quarterly or Annual Report.
4 Q1 2023 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited significant fluctuations over the examined period. Initially, there was a downward trend from $332.62 at March 31, 2018, to a low near $275.55 at December 31, 2018. Subsequently, the price generally increased, reaching a peak above $384 by December 31, 2019. A decline followed in the first half of 2020, aligning with broader market volatility, before a recovery and steady rise began in mid-2021. The share price peaked at $535.51 in September 2022, reflecting strong market optimism or company performance, but then experienced a fall to approximately $443.47 by December 31, 2022, with a slight recovery afterward to $457.68 by March 31, 2023.
- Earnings per Share (EPS)
- EPS data starts from March 31, 2019, with values indicating some variability but a general upward trajectory over time. EPS increased from 19.02 in Q1 2019 to a peak of 44.87 by Q1 2022, suggesting strong earnings growth and improved profitability. After this peak, EPS demonstrated a slight downward correction, settling around 31.5 by March 31, 2023. This pattern indicates a phase of rapid earnings growth followed by stabilization or minor retrenchment in profitability.
- Price-to-Earnings (P/E) Ratio
- The P/E ratio started at 14.48 in Q1 2019 and showed a rising trend through late 2019, peaking near 28.7 at March 31, 2020. This peak reflects increased investor valuation relative to earnings, possibly driven by market expectations. Following this, the P/E ratio declined consistently to around 8.33 by December 31, 2021, indicating either improved earnings outpacing share price gains or market reassessment lowering valuation multiples. From early 2022 onwards, the P/E ratio showed moderate fluctuations, remaining mostly between 12 and 15, suggesting stabilization in market valuation relative to earnings.
- Combined Insights
- Over the period, earnings growth outpaced share price growth, especially between 2019 and 2022, resulting in a declining P/E ratio from elevated levels. The strong EPS expansion implies robust business performance, contributing to the share price recovery and eventual peak in 2022. The subsequent pullback in both EPS and share price in late 2022 and early 2023 signals some moderation in financial performance or investor sentiment. The stabilization of the P/E ratio in the last quarters suggests market expectations have adjusted to a new earnings level with a balanced valuation environment.
Price to Operating Profit (P/OP)
Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
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No. shares of common stock outstanding1 | ||||||||||||||||||||||||||||
Selected Financial Data (US$) | ||||||||||||||||||||||||||||
Operating income (in millions) | ||||||||||||||||||||||||||||
Operating profit per share2 | ||||||||||||||||||||||||||||
Share price1, 3 | ||||||||||||||||||||||||||||
Valuation Ratio | ||||||||||||||||||||||||||||
P/OP ratio4 | ||||||||||||||||||||||||||||
Benchmarks | ||||||||||||||||||||||||||||
P/OP Ratio, Competitors5 | ||||||||||||||||||||||||||||
Boeing Co. | ||||||||||||||||||||||||||||
Caterpillar Inc. | ||||||||||||||||||||||||||||
Eaton Corp. plc | ||||||||||||||||||||||||||||
GE Aerospace | ||||||||||||||||||||||||||||
Honeywell International Inc. | ||||||||||||||||||||||||||||
Lockheed Martin Corp. | ||||||||||||||||||||||||||||
RTX Corp. |
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Data adjusted for splits and stock dividends.
2 Q1 2023 Calculation
Operating profit per share
= (Operating incomeQ1 2023
+ Operating incomeQ4 2022
+ Operating incomeQ3 2022
+ Operating incomeQ2 2022)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of Northrop Grumman Corp. Quarterly or Annual Report.
4 Q1 2023 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
The analysis of the financial data reveals several notable trends in share price, operating profit per share, and the price-to-operating profit ratio over the observed quarterly periods.
- Share Price Trends
- The share price displayed a general upward trend from early 2018 through the first quarter of 2023, despite some fluctuations. Starting at US$332.62 on March 31, 2018, the price declined gradually to a low around the end of 2018 and early 2019, with values near US$275.55 to US$280. Subsequently, the share price rose steadily, reaching peaks above US$450 by early 2022. The highest recorded price was US$535.51 in September 2022, followed by a notable drop to US$443.47 by December 2022, and then a slight recovery to US$457.68 by March 2023. This suggests periodic volatility but an overall positive valuation trajectory over the period.
- Operating Profit Per Share Trends
- Operating profit per share data commences from March 31, 2019, with a value of US$22.27, increasing gradually to a peak value of US$38.23 in September 2021. After this peak, the data indicates a decline, with values dropping to a low of US$22.33 in September 2022, before slightly increasing to US$24.04 in the first quarter of 2023. The increase until late 2021 indicates improving operating efficiency or profitability, while the subsequent decrease might reflect operational challenges or market fluctuations impacting profitability.
- Price-to-Operating Profit Ratio (P/OP)
- The P/OP ratio follows a distinct pattern, inversely correlating with operating profit per share in several periods. The ratio begins at 12.37 in March 2019 and peaks at 16.26 by December 2019, indicating growing share price relative to operating profits. A pronounced decrease occurs from 2020 through 2021, with ratios falling to as low as 9.38 in September 2021, likely reflective of increased operating profits outpacing share price appreciation during this time. However, from 2022 onward, the P/OP ratio escalates substantially, reaching a high of 23.98 in September 2022, before retreating somewhat to 19.04 in March 2023. This rise corresponds with the period of declining operating profits alongside elevated share prices, indicating a higher market valuation relative to actual operating earnings, possibly signifying investor optimism or expectations for future growth despite current profit reductions.
In summary, the company's share price exhibited overall growth with some volatility, operating profits per share experienced a peak in late 2021 before declining, and the price-to-operating profit ratio trends reflect shifting market valuation dynamics influenced by the fluctuations in operating profitability. The data suggest phases of strong operating performance accompanied by moderated market valuations, followed by a period where market valuation outpaced actual operating profit gains.
Price to Sales (P/S)
Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
No. shares of common stock outstanding1 | ||||||||||||||||||||||||||||
Selected Financial Data (US$) | ||||||||||||||||||||||||||||
Sales (in millions) | ||||||||||||||||||||||||||||
Sales per share2 | ||||||||||||||||||||||||||||
Share price1, 3 | ||||||||||||||||||||||||||||
Valuation Ratio | ||||||||||||||||||||||||||||
P/S ratio4 | ||||||||||||||||||||||||||||
Benchmarks | ||||||||||||||||||||||||||||
P/S Ratio, Competitors5 | ||||||||||||||||||||||||||||
Boeing Co. | ||||||||||||||||||||||||||||
Caterpillar Inc. | ||||||||||||||||||||||||||||
Eaton Corp. plc | ||||||||||||||||||||||||||||
GE Aerospace | ||||||||||||||||||||||||||||
Honeywell International Inc. | ||||||||||||||||||||||||||||
Lockheed Martin Corp. | ||||||||||||||||||||||||||||
RTX Corp. |
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Data adjusted for splits and stock dividends.
2 Q1 2023 Calculation
Sales per share
= (SalesQ1 2023
+ SalesQ4 2022
+ SalesQ3 2022
+ SalesQ2 2022)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of Northrop Grumman Corp. Quarterly or Annual Report.
4 Q1 2023 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited a declining trend from March 31, 2018 ($332.62) through December 31, 2018 ($275.55). Starting in early 2019, the share price showed a recovery and an upward trend, peaking multiple times, with notable increases in December 2019 ($384.87) and March 2022 ($445.17). The highest recorded point within the given range is September 30, 2022, at $535.51. After this peak, a decrease followed, with the price moderating towards the end of the period in March 31, 2023 ($457.68), which still represents a substantial gain relative to the 2018 starting value.
- Sales Per Share Development
- Sales per share data begin from March 31, 2019, and depict a steady upward trend over the subsequent periods. Starting at $177.3, the sales per share consistently increased, reaching $244.34 by March 31, 2023. There is a clear pattern of growth without any significant declines, suggesting steady improvement in revenue generation on a per-share basis over time.
- Price-to-Sales (P/S) Ratio Analysis
- The P/S ratio displays variability over time with some notable fluctuations. Initially recorded at 1.55 in March 31, 2019, it slightly declined to 1.51 in June 30, 2019, before peaking at 1.91 in March 31, 2020. Following this peak, the ratio generally declined through 2020, hitting a low of 1.33 in December 31, 2020, indicating the share price was relatively cheaper relative to sales at that point. From 2021 onwards, the P/S ratio gradually increased again, peaking at 2.34 on September 30, 2022, coinciding with the peak in share price observed. By March 31, 2023, the ratio settled to 1.87, suggesting the stock was trading at a moderate premium relative to sales.
- Overall Insights
- The share price and P/S ratio both demonstrate cycles of rises and falls, generally tracking each other with peaks around late 2022. In contrast, sales per share show a consistent upward trajectory, indicating improved underlying business performance. The fluctuations in the P/S ratio imply changing market valuation sentiments relative to sales performance, with periods where the stock price outpaced sales growth and periods where valuation was more conservative.
Price to Book Value (P/BV)
Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
No. shares of common stock outstanding1 | ||||||||||||||||||||||||||||
Selected Financial Data (US$) | ||||||||||||||||||||||||||||
Shareholders’ equity (in millions) | ||||||||||||||||||||||||||||
Book value per share (BVPS)2 | ||||||||||||||||||||||||||||
Share price1, 3 | ||||||||||||||||||||||||||||
Valuation Ratio | ||||||||||||||||||||||||||||
P/BV ratio4 | ||||||||||||||||||||||||||||
Benchmarks | ||||||||||||||||||||||||||||
P/BV Ratio, Competitors5 | ||||||||||||||||||||||||||||
Boeing Co. | ||||||||||||||||||||||||||||
Caterpillar Inc. | ||||||||||||||||||||||||||||
Eaton Corp. plc | ||||||||||||||||||||||||||||
GE Aerospace | ||||||||||||||||||||||||||||
Honeywell International Inc. | ||||||||||||||||||||||||||||
Lockheed Martin Corp. | ||||||||||||||||||||||||||||
RTX Corp. |
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Data adjusted for splits and stock dividends.
2 Q1 2023 Calculation
BVPS = Shareholders’ equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Northrop Grumman Corp. Quarterly or Annual Report.
4 Q1 2023 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends and patterns in the share price, book value per share (BVPS), and price-to-book value (P/BV) ratio over the observed periods.
- Share Price
- The share price exhibited fluctuations across the quarters, starting at $332.62 in March 2018, followed by a general downward trend towards the end of 2018, reaching around $275.55 in December 2018. It subsequently experienced periods of recovery and growth, peaking at $384.87 in December 2019. Following this peak, the share price declined through 2020, dropping to approximately $293.03 in December 2020. In 2021 and early 2022, the share price surged again, reaching an all-time high of $535.51 in September 2022. Despite some volatility thereafter, the price remained elevated, closing at $457.68 in March 2023.
- Book Value Per Share (BVPS)
- Book value per share showed a steady and consistent upward trend throughout the entire period. Beginning at $44.04 in March 2018, BVPS increased gradually each quarter with minor fluctuations, reaching $63.45 by December 2020. The growth accelerated somewhat in the following years, culminating in a value of $99.67 by March 2023. This continuous increase reflects ongoing accumulation of equity or retained earnings relative to the number of outstanding shares.
- Price-to-Book Value (P/BV) Ratio
- The P/BV ratio displayed a declining trend overall, starting at a high level of 7.55 in March 2018 and dropping to around 4.62 by December 2020. This decline indicates that the market price of the shares became less expensive relative to the book value per share over time, especially noticeable through 2019 and 2020. From 2021 onward, the ratio fluctuated between approximately 4.43 and 5.91 without a clear directional trend, suggesting some oscillation in market valuation relative to book value in the more recent periods.
In summary, the data indicates that while the share price has experienced volatility with periods of sharp increases and decreases, the underlying book value per share has trended steadily upward. The declining and then stabilizing P/BV ratio suggests that the market's premium over book value diminished initially but then settled, reflecting changing investor perceptions of the company's value relative to its net asset base.