Having a relatively good idea of the current valuation of a company is a key component in the decision to invest, wait to invest, not to invest, or to stay invested in a company. There are many metrics involved in understanding the value of a company, but for this article, I will look at ABB limited’s (ABB) profitability, debt, stability and ratios such as Price-to-book value, price-to-cash flow, price-to-earnings, PEG ratio, price-to-sales, price-to-tangible book.
Through the above-mentioned of metrics of
Continue reading (NYSE:ABB) Price Analysis Of ABB Limited
Profitability is a class of financial metrics that are used to assess a business’ ability to generate earnings as compared with expenses and other relevant costs incurred during a specific period of time.
In this section we will look at four tests of profitability. They are: Net Income, Operating Cash Flow, Return on Assets and Quality of Earnings. From these four metrics, we will establish if the company is making money and gauge the quality of the reported profits.
Continue reading ABB Ltd: (ABB:NYSE) Inside The Numbers
Earnings and Earnings Growth
1. Earnings = sales x profit margin
2010 – $31.589 billion x 8.11% = $2.561 billion 2011 – $37.990 billion x 8.33% = $3.168 billion
ABB LTD’s earnings increased from $2.561 billion in 2010 to $3.168 billion in 2011 or by 23.7%.
2. Five-year historical look at earnings growth
2007 – $3.611 billion, 2008 – $3.118 billion, 15.81% decrease 2009 – $2.901 billion, 7.48% decrease 2010 – $2.561 billion, 13.27% decrease 2011 – $3.168 billion, 23.70%
Continue reading ABB LTD: (ABB: NYSE) Profitability