公司金融分析CFA 25410 Lect 11 profitability analysis.pptVIP

Profitability Analysis Operating profit analysis Rate of return on assets and equity Earnings per share Interpreting financial statement ratios Lecture 10 - Profitability Analysis 2 TW10 Profitability Analysis Objectives Understand how to analyse firm profit from different perspectives DO List Analyse and interpret changes in rate of return on assets, profit margin and total assets turnover Understand the effect of economic and strategic factors on the interpretation of the rate of return on assets and its components Use financial ratios to analyse profitability Develop a methodological approach to interpreting financial news Identify factors that explain differences in ROA between industries Understand components of profit margin and TATO Understand industry characteristics and how to gauge operating performance Understand how ROA relates to ROCE and the P/E multiple Check: have you ticked each item on the Do List you can do? Profitability Analysis Overview Profitability and Risk are the two main measures to estimate the value a firm Profitability up to now in the course has been 1. 2. 3. But, Where is the growth from? How can we improve on the prediction? Lecture 10 - Profitability Analysis 3 Understanding Profitability Lecture 10 - Profitability Analysis 4 Company Strategy Industry Analyst Insight Understanding Company Profitability Understanding Profitability Need to understand Company strategy what is its competitive advantage Industry it operates in How does this compare to other companies in different industries. Current financial statements Time series trends-changes in businesses (geographical, products, customers) Cross-sectional-be careful with industry analysis since some variation is expected, but are the differences significant? Put everything together then add your insight Lecture 10 - Profitability Analysis 5 Profitability Lecture 10 - Profitability Analysis 6 ROA – how a company uses its assets to generate income? ROCE – How profitable is the c