China Petrochemical Price To Book vs. Return On Equity
| 1314 Stock | TWD 8.15 0.03 0.37% |
For China Petrochemical profitability analysis, we use financial ratios and fundamental drivers that measure the ability of China Petrochemical to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well China Petrochemical Development utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between China Petrochemical's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of China Petrochemical Development over time as well as its relative position and ranking within its peers.
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China Petrochemical Return On Equity vs. Price To Book Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining China Petrochemical's current stock value. Our valuation model uses many indicators to compare China Petrochemical value to that of its competitors to determine the firm's financial worth. China Petrochemical Development is rated second in price to book category among its peers. It also is rated second in return on equity category among its peers reporting about 0.03 of Return On Equity per Price To Book. The ratio of Price To Book to Return On Equity for China Petrochemical Development is roughly 32.25 . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the China Petrochemical's earnings, one of the primary drivers of an investment's value.China Return On Equity vs. Price To Book
Price to Book (P/B) ratio is used to relate a company book value to its current market price. A high P/B ratio indicates that investors expect executives to generate more returns on their investments from a given set of assets. Book value is the accounting value of assets minus liabilities.
China Petrochemical |
| = | 0.47 X |
Price to Book ratio is mostly used in financial services industries where assets and liabilities are typically represented by dollars. Although low Price to Book ratio generally implies that the firm is undervalued, it is often a good indicator that the company may be in financial or managerial distress and should be investigated more carefully.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
China Petrochemical |
| = | 0.0147 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
China Return On Equity Comparison
China Petrochemical is currently under evaluation in return on equity category among its peers.
China Petrochemical Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in China Petrochemical, profitability is also one of the essential criteria for including it into their portfolios because, without profit, China Petrochemical will eventually generate negative long term returns. The profitability progress is the general direction of China Petrochemical's change in net profit over the period of time. It can combine multiple indicators of China Petrochemical, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
China Petrochemical Development Corporation, together with its subsidiaries, produces and sells petrochemical intermediates and related engineering plastics, synthetic resins, chemical fiber, and other derivative products in Taiwan and internationally. The company was founded in 1969 and is headquartered in Kaohsiung City, Taiwan. CHINA PETROCHEMICAL operates under Specialty Chemicals classification in Taiwan and is traded on Taiwan Stock Exchange.
China Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on China Petrochemical. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of China Petrochemical position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the China Petrochemical's important profitability drivers and their relationship over time.
Use China Petrochemical in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if China Petrochemical position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in China Petrochemical will appreciate offsetting losses from the drop in the long position's value.China Petrochemical Pair Trading
China Petrochemical Development Pair Trading Analysis
The ability to find closely correlated positions to China Petrochemical could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace China Petrochemical when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back China Petrochemical - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling China Petrochemical Development to buy it.
The correlation of China Petrochemical is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as China Petrochemical moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if China Petrochemical moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for China Petrochemical can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your China Petrochemical position
In addition to having China Petrochemical in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Additional Tools for China Stock Analysis
When running China Petrochemical's price analysis, check to measure China Petrochemical's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy China Petrochemical is operating at the current time. Most of China Petrochemical's value examination focuses on studying past and present price action to predict the probability of China Petrochemical's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move China Petrochemical's price. Additionally, you may evaluate how the addition of China Petrochemical to your portfolios can decrease your overall portfolio volatility.