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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Kraft Foods Group Inc. pages available for free this week:
- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value to EBITDA (EV/EBITDA)
- Price to FCFE (P/FCFE)
- Selected Financial Data since 2012
- Current Ratio since 2012
- Total Asset Turnover since 2012
- Price to Earnings (P/E) since 2012
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Current Valuation Ratios
Kraft Foods Group Inc., current price multiples
| Kraft Foods Group Inc. | lululemon athletica inc. | Nike 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: 2014-12-27).
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)
Kraft Foods Group Inc., historical price multiples
| Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | ||
|---|---|---|---|---|
| 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: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
- Price to Earnings (P/E) Ratio
- The P/E ratio demonstrates significant fluctuation over the three-year period. It declined notably from 18.67 in 2012 to 12.1 in 2013, indicating a potential decrease in market valuation relative to earnings or an improvement in earnings. However, the ratio surged sharply to 36.18 in 2014, which could suggest expectations of higher future growth, increased market optimism, or possibly earnings pressure impacting the denominator in the ratio.
- Price to Operating Profit (P/OP) Ratio
- A pattern similar to the P/E ratio is observed in the P/OP ratio, with a decline from 11.48 in 2012 to 7.16 in 2013, followed by a substantial increase to 19.96 in 2014. This indicates that the market’s valuation relative to operating profits fell initially but then rose considerably, paralleling the P/E ratio trend and reflecting changes in operating profitability or investor sentiment over the periods.
- Price to Sales (P/S) Ratio
- The P/S ratio exhibits a steady upward trend, increasing from 1.67 in 2012 to 1.8 in 2013, and continuing to rise to 2.07 in 2014. This consistent increase suggests strengthened market valuation relative to sales, possibly due to revenue growth, improved sales efficiency, or enhanced pricing power.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio declined from 8.58 in 2012 to 6.33 in 2013, indicating a decrease in market price relative to book value, but then increased to 8.64 in 2014, slightly above the 2012 level. This pattern may imply fluctuations in investor perception of the company’s asset value or changes in book value components during the periods analyzed.
Price to Earnings (P/E)
Kraft Foods Group Inc., historical P/E calculation, comparison to benchmarks
| Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | ||
|---|---|---|---|---|
| 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 | ||||
| lululemon athletica inc. | ||||
| Nike Inc. | ||||
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
EPS = Net earnings ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Kraft Foods Group Inc. Annual Report.
4 2014 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price demonstrated a consistent upward trend over the observed three-year period. It increased from $51.66 at the end of 2012 to $55.09 in 2013, followed by a more substantial rise to $64.17 in 2014.
- Earnings per Share (EPS)
- EPS showed significant fluctuations during the same period. It rose sharply from $2.77 in 2012 to $4.55 in 2013, indicating improved profitability. However, in 2014, EPS declined markedly to $1.77, suggesting a substantial reduction in earnings relative to the previous year.
- Price-to-Earnings (P/E) Ratio
- The P/E ratio reflected notable volatility in relation to changes in share price and earnings. It decreased from 18.67 in 2012 to 12.1 in 2013, consistent with the rise in earnings. In 2014, the P/E ratio increased dramatically to 36.18, primarily driven by the sharp drop in EPS despite an increase in share price.
Price to Operating Profit (P/OP)
Kraft Foods Group Inc., historical P/OP calculation, comparison to benchmarks
| Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | ||
|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||
| Selected Financial Data (US$) | ||||
| Operating income (in millions) | ||||
| Operating profit per share2 | ||||
| Share price1, 3 | ||||
| Valuation Ratio | ||||
| P/OP ratio4 | ||||
| Benchmarks | ||||
| P/OP Ratio, Competitors5 | ||||
| lululemon athletica inc. | ||||
| Nike Inc. | ||||
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Kraft Foods Group Inc. Annual Report.
4 2014 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price shows an upward trend over the three-year period. It increased from $51.66 in 2012 to $55.09 in 2013, and further to $64.17 in 2014. This indicates a positive market perception and likely reflects growth expectations or improved investor confidence.
- Operating Profit per Share
- Operating profit per share exhibits volatility during the analyzed years. It rose significantly from $4.5 in 2012 to $7.7 in 2013, suggesting enhanced operational efficiency or increased profitability. However, this improved performance was not sustained, as it declined sharply to $3.21 in 2014, indicating a potential operational challenge or increased costs.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio decreased from 11.48 in 2012 to 7.16 in 2013, which could be interpreted as the stock becoming more attractively valued relative to operating profit during that year. In 2014, however, the ratio surged to 19.96, highlighting a significant divergence between share price and operating profit growth, likely driven by the substantial decrease in operating profit per share despite the rising stock price.
Price to Sales (P/S)
Kraft Foods Group Inc., historical P/S calculation, comparison to benchmarks
| Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | ||
|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||
| Selected Financial Data (US$) | ||||
| Net revenues (in millions) | ||||
| Sales per share2 | ||||
| Share price1, 3 | ||||
| Valuation Ratio | ||||
| P/S ratio4 | ||||
| Benchmarks | ||||
| P/S Ratio, Competitors5 | ||||
| lululemon athletica inc. | ||||
| Nike Inc. | ||||
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
Sales per share = Net revenues ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Kraft Foods Group Inc. Annual Report.
4 2014 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited a consistent upward trend over the analyzed period. It increased from 51.66 US$ at the end of 2012 to 55.09 US$ at the end of 2013, representing a moderate growth. The growth accelerated in 2014, with the share price reaching 64.17 US$, indicating a strong positive market sentiment or improved company prospects during this time.
- Sales per Share
- Sales per share remained relatively stable throughout the period. It was 30.91 US$ in 2012, slightly decreased to 30.55 US$ in 2013, and then increased marginally to 30.96 US$ in 2014. This minimal fluctuation suggests that the revenue generated per individual share did not change significantly, indicating steady operational performance in terms of sales output relative to the number of shares.
- Price-to-Sales Ratio (P/S)
- The Price-to-Sales ratio showed a clear increasing trend, moving from 1.67 in 2012 to 1.80 in 2013, and further to 2.07 in 2014. This indicates that the market's valuation of the company's sales improved progressively each year. The rising P/S ratio, despite stable sales per share, implies growing investor confidence or expectations of future growth, as the market was willing to pay more per unit of sales.
Price to Book Value (P/BV)
Kraft Foods Group Inc., historical P/BV calculation, comparison to benchmarks
| Dec 27, 2014 | Dec 28, 2013 | Dec 29, 2012 | ||
|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||
| Selected Financial Data (US$) | ||||
| Equity (in millions) | ||||
| Book value per share (BVPS)2 | ||||
| Share price1, 3 | ||||
| Valuation Ratio | ||||
| P/BV ratio4 | ||||
| Benchmarks | ||||
| P/BV Ratio, Competitors5 | ||||
| lululemon athletica inc. | ||||
| Nike Inc. | ||||
Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).
1 Data adjusted for splits and stock dividends.
2 2014 Calculation
BVPS = Equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Kraft Foods Group Inc. Annual Report.
4 2014 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price showed a consistent upward trend over the three-year period. It increased from $51.66 at the end of 2012 to $55.09 at the end of 2013, representing a moderate rise. This positive momentum continued into 2014, with a more substantial increase to $64.17, indicating growing market confidence or positive performance expectations.
- Book Value Per Share (BVPS)
- The book value per share experienced fluctuations during the same period. It rose significantly from $6.02 at the end of 2012 to $8.70 at the end of 2013, suggesting an improvement in the company's net asset value per share. However, in 2014, the BVPS decreased to $7.42, which could indicate asset revaluation, increased liabilities, or other factors impacting the net asset base negatively.
- Price-to-Book Value (P/BV) Ratio
- The P/BV ratio exhibited variability across the years. It started high at 8.58 in 2012, declined notably to 6.33 in 2013 as the book value per share increased faster than the share price, and then rose again to 8.64 in 2014. The increase in 2014 reflects a scenario where the share price growth outpaced the decline in book value per share. This suggests the market valued the company's shares more highly relative to its book value, possibly due to optimistic growth prospects or intangible assets not captured in book value.
- Overall Analysis
- Over the observed period, the share price growth indicates steady investor confidence. The variability in book value per share introduces some uncertainty about underlying asset performance or accounting adjustments. The P/BV ratio's fluctuations reflect changing market perceptions relative to the company’s net assets, with a notable dip and recovery that aligns with shifts in BVPS and share price. The data suggests that while asset values showed some inconsistency, market sentiment remained largely positive, culminating in the highest share price and P/BV ratio at the end of 2014.