Re-rating your price earnings (P/E) multiple
Price earnings (P/E) multiples are commonly used by corporate financial managers as a measure of corporate performance and as a measure of corporate value. With this article an analysis of 74 companies is presented. Each company significantly changed its P/E multiple over a period of three years. Th...
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| Format: | Article |
| Language: | English |
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1993-06-01
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| Series: | South African Journal of Business Management |
| Online Access: | https://sajbm.org/index.php/sajbm/article/view/865 |
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doaj-0a0370fd1a10491485694823c79f29db2021-02-02T06:29:07ZengAOSISSouth African Journal of Business Management2078-55852078-59761993-06-01242737610.4102/sajbm.v24i2.865584Re-rating your price earnings (P/E) multipleMike Ward0Graduate School of Business Administration, Faculty of Management, University of the WitwatersrandPrice earnings (P/E) multiples are commonly used by corporate financial managers as a measure of corporate performance and as a measure of corporate value. With this article an analysis of 74 companies is presented. Each company significantly changed its P/E multiple over a period of three years. The analysis shows that a 2% improvement in operating profit margin or a 2% reduction in financial risk achieved a 1% improvement in the P/E multiple. To a lesser extent, an improvement in the current ratio and in net asset value also resulted in an improved P/E multiple.https://sajbm.org/index.php/sajbm/article/view/865 |
| collection |
DOAJ |
| language |
English |
| format |
Article |
| sources |
DOAJ |
| author |
Mike Ward |
| spellingShingle |
Mike Ward Re-rating your price earnings (P/E) multiple South African Journal of Business Management |
| author_facet |
Mike Ward |
| author_sort |
Mike Ward |
| title |
Re-rating your price earnings (P/E) multiple |
| title_short |
Re-rating your price earnings (P/E) multiple |
| title_full |
Re-rating your price earnings (P/E) multiple |
| title_fullStr |
Re-rating your price earnings (P/E) multiple |
| title_full_unstemmed |
Re-rating your price earnings (P/E) multiple |
| title_sort |
re-rating your price earnings (p/e) multiple |
| publisher |
AOSIS |
| series |
South African Journal of Business Management |
| issn |
2078-5585 2078-5976 |
| publishDate |
1993-06-01 |
| description |
Price earnings (P/E) multiples are commonly used by corporate financial managers as a measure of corporate performance and as a measure of corporate value. With this article an analysis of 74 companies is presented. Each company significantly changed its P/E multiple over a period of three years. The analysis shows that a 2% improvement in operating profit margin or a 2% reduction in financial risk achieved a 1% improvement in the P/E multiple. To a lesser extent, an improvement in the current ratio and in net asset value also resulted in an improved P/E multiple. |
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https://sajbm.org/index.php/sajbm/article/view/865 |
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