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Price earning ratio = market value per share / Earning per share Earning per share = Net income available to share holders / number of shares outstanding
Profitability means ability of the entity to earn more than the costs they incurred on their business operation. Normally, the price of the good available for sale (unit per rate) is higher than its cost in order to earn profit. Thus, unit price - unit cost = profit
The most important factor for calculated stock price is earning per share, which indicates how profitable a company is.
Many possible reasons, a few of which are: 1) Negative outlook for that sector, thus market believes increases are anomalous, 2) Company is taking on new debts, 3) Company is not reinvesting those profits in a way which will promote eventual growth 4) Increased profit created by a one time deal/ or created by some means which is considered unsustainable... Short term profitability changes do not drive long term value of shares. If overall value or growth potential of a company are not seen by the market to be increased, even with the occurrence of a recent increase of profitability, share prices will not rise! Remember, the price of a stock is based primarily on PEOPLE's subjective opinion, or what they are willing to buy/sell it for. So if people perceive that a company will begin to/continue to struggle, in spite of recent increases in profitability, there will be few buyers to support the price of that company's stock. A company might be increasing profits while at the same time fire-selling its assets, and thus the asset value of the company is decreasing. Profit increases/decreases are a small part of the overall picture!
Because the price of gasoline changes quite often and is not a fixed cost.
More than you can afford
The fluctuation in price of shares stems from a company's profit or ability to earn profit. If profitability increases, then share price increases also.
Price earning ratio = market value per share / Earning per share Earning per share = Net income available to share holders / number of shares outstanding
The price to earnings ratio is how investors determine how the security is priced. For example, with a high P/E the security is considered expensive, while a low P/E is considered cheap. Most investors tend to buy securities with a low P/E. Let me know if this helps.
If you mean the price-earnings ratio. It is the price per share of a common stock divided by the annual earnings of the stock.
rising profit, because in case of scarcity, the price signal induces producers to increase their capacity because rising price means rising profitability. :)
It's profits are increased.
Profitability means ability of the entity to earn more than the costs they incurred on their business operation. Normally, the price of the good available for sale (unit per rate) is higher than its cost in order to earn profit. Thus, unit price - unit cost = profit
BY earning commissions for the travels booked.
No, price lists are considered as advertisement.
Antonia Scalia has written: 'Bidder profitability under uniform price auctions and systematic reopenings'
The company's earning record and future earnings probability will influence the price of the stock to a very large extent.