Valuation ratios Flashcards

1
Q

Valuation ratios

A

Measures to help investors assess the market value of a firm
- these ratios are intended to make intra-industry comparisons of firm valuations

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2
Q

Price-to-earnings ratio (P/E)

A

Market capitalization / Net income
or share price / EPS

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3
Q

EV to EBIT

A

(Market value of equity + net debt) / EBIT

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4
Q

EV to sales

A

(Market value of equity + net debt) / Sales

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