Price-earnings Ratio


Price-earnings ratios are published daily in newspapers for stock market-listed companies, along with the gross dividend yield, dividend cover and other information about the shares of each company. The method of calculation is what the name suggests:

Price-earnings ratio = stockmarket share price divided byEarnings per share

The stockmarket share price used is the one published in the financial newspapers at the close of business in the stock exchange for the previous evening.

As a generalization, when the price earnings ratio of a company is higher than the average for other companies in the same business sector, the stockmarket expects the company to achieve higher than average earnings per share in the foreseeable future to justify the above-average valuation of the shares.

In certain circumstances, the explanation may be quite different. For example, a takeover bid for the company may be widely expected, and the share price has already increased significantly in anticipation of the price to be offered by the bidder.

It must never be forgotten than the analysis of share prices, and especially the prediction of future changes, cannot be done simply by calculating the various ratios. If this was possible, making a fortune on the stockmarket would be easy. In practice, even the most experienced investment-fund managers would make costly errors of judgment from time to time.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight

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Treating Employees as Customers


If employees feel valued and their needs are taken care of, they are more likely to stay with the organization. The CEO’s primary job is cultivating a corporate culture that benefits all employees and customers. If you build a company and a product or service that delivers high levels of customer satisfaction, and if you spend responsibly and manage your human capital assets well, the other external manifestations of success, like market valuation and revenge growth, will follow.

 

Many companies have adopted the idea that employees are also customers of the organization, and the basic marketing strategies can be directed at them. The products that the organization has to offer its employees are a job (with assorted benefits) and quality of work life. To determine whether the job and work-life needs of employees are being met, organizations conduct periodic internal marketing research to assess employee satisfaction and needs. Become the best place to work by doing the following:

  • Treating employees as customers;
  • Using employee input and a fact-based approach for decision-making in the design and implementation of human resources policies, programs, and processes.
  • Measuring employee satisfaction and trying to continuously improve the workplace environment.
  • Benchmarking and incorporating best practices.

 

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight